How Long Are Items on Backorder?

Products are on backorder for varying lengths of time, depending on the industry, supply chain, backorder process, and other factors. Some back ordered products might come back in stock within only 24 hours. Others might take one to two weeks when a product is in high demand. And some products take several weeks. 

Certain firms send refunds automatically if a product is still unavailable after a limited number of days, such as 25. If you want to avoid these delays or refunds, be aware of the following situations that can cause backorders, and try to anticipate them: 

• Not Enough Excess Product: Ecommerce businesses need some excess inventory to cover regular or unusual shifts in demand.
• A Sudden Demand: If your product receives a media mention, wins an award, or simply receives more purchases in a certain season, keep more safety stock available.
• Supply Chain Problems: A supplier or manufacturer could be on a local holiday, run out of a certain part, or work more slowly than anticipated.

Backorder Problems

Are backorders a danger to your business? How diligently should you attempt to avoid them? The problems backorders can cause affect both your customers and your business. 

Customers who have had bad experiences with backorders may not be sure they will ever receive the product from you. They may wonder if additional delays will follow the initial delay. They may want to cut their losses and simply shop with a different vendor for quicker results. 

Your business revenue can be compromised by backorders. More customers may ask for refunds than you had expected—far beyond your budget. Plus, your reputation could be hurt by unsatisfied customers who tell their friends or write negative online reviews about you. Your firm risks losing customers and losing future prospects due to backorder problems.

Avoiding backorders requires an expert balance of safety stock, two-way communication with suppliers, and a transparent backorder process that reassures customers they will be satisfied. An efficient solution to the challenge is to upgrade your inventory management system with improved software or by hiring a third-party logistics firm that manages these issues every day.

How Do You Deal with Backorders?

Best practices for approaching backorders include the following: 

• Follow a backorder plan and a backup plan. If additional backorder delays occur, switch to the backup plan, and communicate as many details and extra offers as needed in as many customer communication channels as needed.
• Search for trends in demand. Find out when demand changes, even down to the day of the week. Forecast future demand with increasing accuracy. 
• Plan how you will source your most important materials or products if one vendor runs out of them.
• Analyze how your finished products (and even raw materials) are transported. Find out how quickly they could send you more in an emergency and in what quantities. 
• Increase your excess stock of items through a larger warehouse or third-party logistics firm.

Contact Elite Ops for Inventory Management and Shipping Services Today!

By partnering with an inventory management service provider such as Elite OPS, you can delegate backorder problems and planning to a firm that focuses on this area full-time. Elite OPS has software, experience, expert workers, and other resources to improve this area of your business. We have practiced every area of logistics for many years. To learn more about our inventory management services, request a free quote now.