Cash Before Delivery (CBD)

Posted in Marketing and Strategy Terms, Total Reads: 589

Definition: Cash Before Delivery (CBD)

Cash before Delivery (CBD) may be defined as paying the money before the product is physically delivered to the customer. Cash before delivery when the customer is aware of the product or service, and is willing to pay for it before it is delivered to him/her. Cash before delivery is also referred to as prepaid service, where in payment is done before the services are given to the customer.

Gradually with time however, companies are now favouring cash on delivery (COD), which gives a priority to the customer.

In India and the world on large the concept of Cash on Delivery was an alien concept and none of e commerce system followed this rule. Amazon, EBay and other ecommerce giant practised CBD before the advent of Flip Kart in India. In India the customers had a notion that the product would not be delivered and money would be deducted. In order to overcome this notion Flipkart introduced Cash on Delivery for its customers and it was an instant hit. Most of the competitor followed suit and the concept of CBD was suppressed by COD

While this system of COD was an instant hit in India in other countries this concept failed before take-off. The predominant example has been the Chinese market. Chinese market did not like the idea of COD because it has the culture of trust and belief. This idea was then withdrawn and CBD concept was focussed upon.

Future of CBD:

If we look at the future, we can easily visualize that the concept of CBD won’t be much of a success in India but the same would be success in the rest of the world.

Hence, this concludes the definition of Cash Before Delivery (CBD) along with its overview.


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