Backorder Processing

Backordering is normally used when inventory is not available for shipment.  Rather than delaying an entire order because one or more parts are temporarily out of stock, the unavailable parts are placed on backorder, and the rest are shipped.  In addition to allowing the operator to backorder parts, the system also permits the operator to release parts that are currently unavailable but will be in stock at the time of shipment.

Except in blanket order entry, backordering is allowed at any time until an order is shipped.  In the Postbilling and Debit/Credit Memo Entry conversation, the backorder quantity is processed as ordered and concurrently canceled.  It appears on the invoice as a difference between ordered and shipped quantities, but does not update the quantity backordered field for the appropriate part in the Warehouse Balance file.  This approach is used because the postbilling environment typically would not handle backorders in the same manner as an environment which separates the order entry and billing steps.

Considerations

When a part is backordered for future shipment, inventory will be backordered.  The backordered line is reported on the Availability Exception Report.

The system automatically backorders parts in Sales Order Maintenance whenever a discrepancy between order quantity and the sum of the other quantity fields is noted.  If the system option does not allow over-reservation of inventory and parts are not available, the released quantity will be reduced to what is available and the remainder will be backordered.  Since the system computes the backorder quantity using the other quantity fields, the operator must alter the order or release quantity field to change the backorder quantity.

For lot-assignable items, a backordered quantity is the difference between the order quantity and the amount released or shipped for the order.

Backorders are not automatically released.  If the original order has not been shipped, backorder quantities may be changed through the normal order maintenance or shipping and billing process; otherwise, either the Multi-line Inventory Reservation, Backorder Release, Backorder Release By Part, or Automatic Order Release conversation must be used. 

In backorder release, it is possible to release all or only some of the parts on backorder.  Backorders may be released either from the same company/warehouse in which the original order was placed or from any other company/warehouse.  The Backorder Release conversation sets up a new order with the order quantity equal to the backorder quantity on the parent line.  The Backorder Release By Part conversation enables users to fill backorders for a specified part that has been produced or received.  The Automatic Order Release program will release orders based on user-defined criteria as inventory becomes available.

Alternatively, users can handle backorders prior to shipping by generating revised picking documents from the Sales Order Maintenance conversation.  This method avoids creation of a new order.

Backorder releases may also be maintained in Sales Order Maintenance.  The reserved quantity may be changed and the original (parent) backorder and subsequent release quantities will be updated accordingly.