Definition
A backorder occurs when a product is temporarily out of stock but customers can still place orders, with fulfillment delayed until the item becomes available again.
Explanation
In dropshipping, backorders happen when a supplier runs out of inventory but plans to restock soon. Instead of stopping sales, the store continues accepting orders and fulfills them later once the supplier replenishes stock.
While backorders can help maintain sales momentum, they also introduce risks if not managed properly.
Key considerations for backorders in dropshipping:
- Longer delivery times may affect customer satisfaction
- Clear communication is essential to avoid disputes or refunds
- Supplier reliability determines how quickly orders can be fulfilled
- Order tracking and updates help maintain customer trust
Some stores choose to disable backorders to avoid delays, while others use them strategically for high-demand products.
Example
A dropshipping store sells a trending LED desk lamp:
- The supplier temporarily runs out of stock.
- The store continues accepting orders with a notice: “Ships in 7–10 days.”
- Customers place orders despite the delay.
- Once the supplier restocks, all backordered items are shipped.
The orders placed during the stock shortage are considered backorders.
Key Takeaway
Backorders allow dropshipping stores to continue selling out-of-stock products, but require careful communication and supplier coordination to avoid customer dissatisfaction.