When selling products that are not immediately available, you can offer customers the option to Preorder or Backorder.
While both methods allow customers to purchase unavailable items, they cater to different inventory situations.
Understanding the difference will help you decide which option works best for your business.
What is a Preorder?
A preorder allows customers to purchase products before they are officially available in stock.
This is ideal for new product launches, limited-edition items, or upcoming restocks where merchants want to gauge demand before production or release.
Use Cases for Preorders
- Product Launches: Selling items before their official release to build excitement and secure early sales.
- Custom-Made or Limited Edition Items: Allowing customers to place orders in advance for exclusive or made-to-order products.
- Seasonal Stock: Accepting preorders for holiday or seasonal inventory before availability.
- Crowdfunding Campaigns: Selling products in advance to fund production costs.
When to Choose Preorder?
- You have a fixed launch date for the product.
- You want to generate demand before production.
- You plan to manufacture based on orders received.
Inventory Settings for Preorder
For preorders to work, either one of the following inventory settings must be met.
i) Track quantity disabled
When track quantity is disabled, you can offer unlimited preorders.
Say you're selling a digital course or e-book. No physical stock is involved, and therefore, quantity tracking isn’t needed. Still, you can continue taking preorders indefinitely.
ii) Track quantity and “Continue selling when out of stock” are enabled
When 'Track quantity' and 'Continue selling when out of stock' are enabled, you can offer unlimited preorders.
Say you're launching a new sneaker. Regardless of the stock quantity (0 or positive), you can continue taking preorders since both settings are enabled.
iii) Track quantity is enabled, but “Continue selling when out of stock” is disabled
When 'Track quantity' is enabled, but 'Continue selling when out of stock' is disabled, preorders are only available while inventory is still positive. Once stock reaches zero, the product is marked as Sold Out, even if the preorder limit hasn’t been reached.
Say you're selling a limited edition product as a preorder, and inventory is set to 500 units. Preorders automatically stop and switch to 'Sold Out' once stock runs out.
What is a Backorder?
A backorder lets customers purchase products that are currently out of stock but will be restocked later.
This ensures merchants can continue selling even when stock temporarily runs out.
Use Cases for Backorders
- High-Demand Products: Keeping sales open for fast-selling items that go out of stock frequently.
- Restocking Delays: Allowing customers to order while waiting for the next shipment.
- Supplier-Based Businesses: For stores that rely on external vendors or manufacturers for inventory replenishment.
When to Choose Backorder?
- The product was in stock but is temporarily unavailable.
- You have a confirmed restock timeline from suppliers.
- You want to minimize lost sales due to stockouts.
Inventory Settings for Backorder
Backorder works only when 'Track quantity' is enabled. Dibs automatically manages the ‘Continue selling when out of stock’ setting in real time based on inventory levels.
Dibs automatically enables “Continue selling when out of stock” in two scenarios:
- When you create a backorder plan for a product that is already out of stock.
- When a product linked to an active backorder plan goes out of stock after initially having positive inventory.
Dibs automatically disables “Continue selling when out of stock”
- When a product is restocked and its inventory becomes positive.