Backorder vs Preorder

Which is the game changer for your business: Backorder vs Preorder?

As you know, an order is made when a shopper purchases an item from a store. It defines what they bought, how much the product costs, and where to deliver the purchase. In a wider classification, you have two terms ‘backorder’ and ‘preorder.’ What is the difference between backorder vs preorder? Check out this post for the answer.

Backorder definition and example

Backorder definition and example

Backorder is when a client or shopper places an order for an item that is impossible to get shipped at once because it is not in stock at that time. Said differently, you cannot fulfill these orders right away, yet are certain to complete them on a later day.

For instance, an Arizona-based footwear brand gets an order from a store located in Los Angeles to provide 20,000 pieces of footwear within 60 days. Nevertheless, their existing stock and their 60-day manufacturing capacity just enable them to deliver 12,000 pairs.

The brand does not refuse the order but asks the chain whether 20,000 pairs are okay for their needs, to begin with. Then, the firm changes the order of the remaining pairs into backorders of 4,000 pieces to get shipped each 30 days. 

Preorder definition and example

Backorder definition and example

Customers place their order prior to the official launch of the product. Those who buy this way enjoy some advantages compared to people having typical orders because sellers fulfill preorders beforehand.

For instance, Sony PlayStation 5 gaming device was available for pre-selling. That is why those who wished to own a brand new PlayStation had the chance to be the first to buy it quickly before its official accessibility on the market. As for Sony, they got a considerable sum of money without having to launch the product immediately.

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Backorder vs preorder: How different are they?

Speaking of a preorder, the goods are yet to be produced or manufactured. It assists businesses in planning the sales and supply of new items whose needs are pent-up. 

As for a backorder, the goods are already out there, yet not in stock at that moment. This type of order assists sellers in deciding between two opposing action plans (i.e., on-time purchase order completion and profitability). It frees your business from the false dilemma related to no and yes and offers a beneficial third option.

The bottom line is that both backorder and pre-order are both crucial to your strategy associated with warehouse inventory management. And for those who are wondering how to execute them the most efficiently, we have a good piece of news worth celebrating. You can count on ConnectPOS to create both types of orders with ease. 

ConnectPOS

Thanks to ConnectPOS, you can create pre-orders for products soon to come. Likewise, this system allows you to create backorders for temporarily out-of-stock products. 

In short

In this post, we have addressed the differences between backorder vs preorder and suggested the most outstanding POS system to handle it. Hopefully, you find it helpful and applicable. Should you have any further inquiries, do not hesitate to reach us.

About the Author

Lana D.

Lana D.

I’m Lana and I have a passion for writing. I enjoy writing on a variety of topics, particularly eCommerce and whatnot.

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