Shopify Backorder Management

A backorder lets a customer buy something that is out of stock, on the understanding that it ships when stock arrives. It keeps a sale alive, but it costs money to handle, so decide which products qualify, set expectations before checkout, and treat every backorder as a signal to fix replenishment.

What a backorder is, and when to accept one

A backorder is an order for a product that normally sells but is temporarily out of stock. A preorder is different: the product has not been released yet. With a backorder the customer expects the item you have always sold, just later than usual.

Accepting backorders makes sense when:

• You know the restock date. Your supplier gives a date you trust, and you can state it to the customer with reasonable confidence.
• Customers are likely to wait. The product is hard to substitute, or the alternatives are clearly worse.
• The margin can absorb the extra handling. Backorders add support contacts, tracking and sometimes extra shipping. A thin margin may not cover that.
• The wait is short enough to be believable. The longer the wait, the more reason a customer has to cancel, so compare your cancellation rate against wait length.

Poor candidates include products with unpredictable supplier timelines, seasonal items past their window, and commodity goods the customer can buy elsewhere tomorrow.

Setting up backorders

Shopify has a per-variant setting that lets customers keep buying after tracked inventory reaches zero, usually labelled "continue selling when out of stock." With it on, the quantity can go negative, and the negative number is the count of units you owe customers. That is a useful number to watch.

The setting alone tells the customer nothing. They will assume normal shipping and be unhappy when the parcel does not arrive. Add messaging so the customer knows before they pay:

• A notice near the buy button that appears when the quantity is zero or below.
• A product field holding the expected ship date, displayed in that notice.
• A different order confirmation email for backordered items (see the templates below).

What a backorder costs

Backorders look free because the sale still happens, but each one carries costs:

• Support contacts. "Where is my order?" messages.
• Cancellations. Customers who change their mind before it ships, plus the processing cost of refunding them.
• Disputes. A customer who waits too long may dispute the charge with their card issuer, which can cost the order value plus a fee.
• Expedited shipping. Upgrading shipping to make up for the wait.
• Weaker repeat business. A customer who had a poor wait may buy less often. This is hard to measure, so track repeat purchase rate for backorder customers separately.

A fulfillment workflow for backorders

1. Tag and segment. Tag orders containing backordered items as soon as they arrive. Use consistent tags such as backorder and backorder-partial for orders that mix in-stock and backordered items, so you can filter them out of the normal queue.
2. Confirm clearly. The confirmation email should say the item is on backorder, give an estimated ship date, explain how to cancel, and tell the customer how to reach you.
3. Watch supplier timelines. Compare open purchase orders with the dates you promised. If a delay will push you past your date, tell the customer before they ask.
4. Fulfill in order received. When stock arrives, fill the oldest backorders first. This breaks down when someone picks from the order list by hand, so sort by order date.
5. Follow up after shipping. Send tracking prominently and thank the customer for waiting.

When setting the estimated date, start from the supplier's expected arrival, add your receiving and handling time, then add a buffer for lateness. Using the slowest of your last several deliveries is safer than using the supplier's quote.

Split shipments: ship now or wait

When an order mixes in-stock and backordered items, you can hold the whole order or ship what you have and send the rest later. A split costs a second parcel. Compare that cost with the margin on the order.

• Length of the delay. For a short delay, holding is usually fine. For a long one, shipping the in-stock items now is kinder.
• Whether the items go together. If the in-stock item is useless without the backordered one, a split gains the customer nothing.
• Customer relationship. A repeat or subscription customer may justify the extra shipping cost.
• Margin. Thin-margin orders cannot afford much extra postage.

Whichever you choose, say so before checkout or in the confirmation email.

Preventing backorders

Every backorder is also a replenishment signal. Four numbers help you catch the risk early.

• Days of supply = on hand ÷ average daily sales. If days of supply is lower than the supplier lead time, you will run out before a new order can arrive, even if you order today.
• Reorder point = (average daily sales × lead time in days) + safety stock. See the reorder point formula.
• Safety stock is the buffer for demand spikes and late deliveries. See the safety stock formula.
• Forecast error. A common measure is the mean absolute percentage error: the average of |actual − forecast| ÷ actual across periods. It breaks down when actual demand is zero, so for slow sellers use weekly or monthly totals. See improving forecast accuracy.

Count open backorders when you check the trigger, or a stock count that looks fine can hide customers waiting for it:

Use the physical units counted on the shelf for on hand. If your system quantity already goes negative for backorders, do not subtract the owed units a second time. For methods, see sales velocity tracking, demand forecasting and preventing stockouts.

Communication templates

Adapt these to your own voice and replace the bracketed parts.

Product page notice

"This item is on backorder. Orders placed today are expected to ship by [date]." Depending on your payment capture settings, the customer may be charged at checkout, so word any statement about when they are charged to match what actually happens.

Order confirmation

"Order confirmed: your [product] is on backorder and is expected to ship by [date]. If the date changes we will email you. You can cancel any time before it ships by replying to this message."

Delay notification

"Your [product] has been delayed. The new estimated ship date is [date]. We are sorry for the wait. You can keep the order or cancel for a full refund. [Optional goodwill gesture.]"

Shipment notification

"Your [product] has shipped. Track your package here: [link]. Thank you for waiting."

Measuring backorder performance

Track these monthly and watch the trend. Set your own targets from your first few months of data rather than borrowing someone else's.

• Backorder rate = orders containing a backordered item ÷ total orders.
• Average backorder fulfillment time = average of (ship date − order date) for backordered orders.
• Cancellation rate = cancelled backorders ÷ total backorders.
• Dispute rate = disputed backorders ÷ total backorders.
• Repeat purchase rate for backorder customers, compared with customers who had no backorder.
• Support tickets per backorder = tickets about backordered orders ÷ backordered orders.

If backorders are a regular event rather than an exception, the problem is upstream. Communication cannot repair a replenishment process that keeps running out. Review reorder points, supplier lead times and safety stock, and check your inventory KPIs and your purchase order process.

Common backorder mistakes

• Accepting backorders without a visible timeline. If the customer does not know it is a backorder, you have already lost their trust.
• Promising optimistic dates. Add a buffer. Shipping early pleases people. Shipping late draws complaints.
• Holding in-stock items without saying why. The whole order feels delayed.
• Not tracking the cost. Knowing your backorder rate is not enough. Work out what a backorder costs per order.
• Treating backorders as inevitable. Record the root cause of each one: late supplier, forecast miss, unexpected promotion or wrong reorder point.
• Managing them from memory. Once backorders pile up, you need a list with order date, item, promised date and status, even if it is a spreadsheet.