Role Of Backordering In Your Ecommerce Business

25.02.22 04:36 AM Comment(s)

Role Of Backordering In Your Ecommerce Business

Have you ever thought what will happen if a buyer tries to buy a stock from your Amazon ecommerce store but it shows out of stock? You will lose approximately $10-20 dollars in that moment!
So what better you can do to keep your customers engaged within your store?
We call it “Backordering”!
Backordering is the method of safeguarding your revenue when you face inventory shortage in processing the customer’s orders. In backordering, the customers can still put an order even if the stock is out of order. The reasons can be numerous like delay in production, shipment issues or lack of ingredients those results into high demand over supply.
You must be getting confused between the backordering sales order and out of stock right?
In Backordering process the customers gets a chance to order the stock even if it’s out of stock right now. fulfillment by Amazon seller provides a particular date to replenish the stock again, so that the customer can receive the order on a defined date. But in Out of stock order, the customer can’t order the stock from the Amazon online store.
Though it’s not an ideal solution to delay in the delivering of customer’s order always but yes, it can protect businesses from cancelling or halting the sales!

Let’s take a gander on the benefits and disadvantages of Backordering sales order.

Backordering sales order is considered one of the best plans of attack for Amazon automation store management but at the same it comes with too many cons. Here we go:

Inventory Management- With the sudden surge in demand, many ecommerce owners relays on backordering system as it help to manage the inventory better. Amazon seller can continue selling the orders because they know that the stock will be restocked again on time. It ensure guarantee to the third party sellers that whatever they are selling or buying will get sold.

Maintain Revenue- Most of the time manufacturing team fail to deliver the stocks on time due to supply chain issues, shipment delay and shortage of materials. Still Amazon sellers keep the light on to deliver the customer’s order with the shortage of stock by backing it with the Backordering. We can say “backorders keep our ecommerce stores afloat under the pressure & protect our bottom line when nothing is going right!

No need of Storage Space- Amazon businesses can save a lot of dollars by directly delivering the order to the consumer’s destination. It saves your storage costs by removing the need of warehouse. With Amazon automation dropshipping services, the third party will pick the order, pack and ship instantly once it is available.

Now it’s time to read out some drawbacks:

Delay in Delivery- As in backordering, the buyers usually gets the order late this is because of the shortage of the stock at the Amazon warehouse. 

Loose Customer Loyalty- When orders are backorder, it leaves customers with no option than moving to the competitor’s websites. For suppose- A customer orders an item from the Amazon ecommerce online store without knowing that the item is in backordering process. Until the warehouse restocked, the buyer will see the order status “in process” or “delay in shipment due to”, this can make your buyer impatient. Consequently you lose customer or can face “order cancellation”.

Loss in Sales- In backordering sales order, if the buyer does not receive the order on usual time that is 2-3 days, there are chances of order cancellation and refunds requests. In short when you have fewer inventories on hand but threshold a set of orders; it could lead to the loss of potential sales.

For this, you can hire an Amazon automation company to assist you with best inventory management. We can help you with the automationinventory management, tracking, minimum order quantities required and how much orders you should list in backlog so that, you can take profitable decisions for your business. By automating your inventory process, you can manage backorders easily!

Get free consultation right away!

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