Backorder

A backorder is an order placed by a customer for a product that is currently out of stock and will be fulfilled once new inventory arrives. This situation occurs when demand exceeds available supply, but the retailer continues to accept orders with the understanding that delivery will be delayed. Backorders allow businesses to capture sales they would otherwise lose while providing customers the option to secure items they want despite temporary stock shortages.

Why it matters for e-commerce brands

For Shopify and DTC merchants, enabling backorders can prevent lost sales during stockouts and provide valuable demand signals for inventory planning. However, managing backorders requires clear communication with customers about expected fulfillment dates and reliable supplier relationships to avoid disappointment. Poor backorder management can lead to canceled orders, negative reviews, and damaged customer trust, making it critical to set accurate expectations and maintain transparent order status updates.

Example

A Shopify store selling fitness equipment runs out of a popular yoga mat due to unexpectedly high demand. Rather than marking the product as "sold out," the merchant enables backorders and updates the product page to indicate "Available for backorder - ships in 2-3 weeks." Customers can still add the item to their cart and complete checkout, with automated emails confirming their order and providing shipping updates. When the new shipment arrives from the supplier, the merchant fulfills backorders in the sequence they were received, ensuring customers who ordered first receive their items first.

Related terms

• Stockout
• Preorder
• Lead time
• Safety stock
• Inventory replenishment