Orders Terms & Definitions

A real-time inventory calculation that determines how much stock can be committed to new customer orders, accounting for current on-hand quantity minus already allocated, reserved, and held inventory.

A backorder is a customer order for a product that is currently out of stock but expected to become available for fulfillment at a later date.

A long-term purchase agreement with a supplier for repeated delivery of goods at pre-negotiated prices over a specified time period.

A forced transaction reversal initiated by a cardholder’s bank, typically resulting from a customer dispute over a charge, and carrying financial penalties for the merchant.

The smallest number of units a supplier or manufacturer will accept in a single purchase order, directly affecting inventory costs and purchasing strategy.

A centralized platform that captures, tracks, and orchestrates customer orders from multiple sales channels through fulfillment and delivery.

The percentage of orders shipped without errors, measuring how often the right products in the right quantities reach the right customers.

The total value or quantity of customer orders that have been received but not yet fulfilled, representing committed future revenue awaiting processing.

The practice of grouping multiple orders together for simultaneous processing to improve warehouse efficiency and reduce pick time per order.

The total elapsed time from when a customer places an order to when they receive it, encompassing processing, picking, packing, shipping, and delivery.

The complete sequence of stages an order passes through from initial placement to final delivery and potential return, including capture, processing, fulfillment, shipping, and post-delivery.

The automated, rules-driven process of coordinating every step of an order—from capture and inventory allocation through routing, fulfillment, and delivery—across multiple locations and channels.

A system for ranking orders by urgency and importance to determine processing sequence, ensuring critical orders are fulfilled first.

Order routing is the process of automatically directing incoming orders to the optimal fulfillment location based on rules like proximity, stock availability, and shipping cost.

The practice of dividing a single customer order into multiple shipments, typically because items are stocked at different fulfillment locations or have different availability timelines.

The end-to-end business process that covers every step from receiving a customer order through to collecting payment, encompassing order management, fulfillment, invoicing, and revenue recognition.

The practice of shipping the available portion of an order immediately while the remaining items are backordered, sourced separately, or fulfilled at a later date.

The percentage of orders delivered complete, on time, undamaged, and with correct documentation—measuring end-to-end fulfillment quality.

An order placed for a product before it is available for immediate shipment, allowing customers to reserve items that are upcoming, in production, or temporarily out of stock.

A formal document issued by a buyer to a supplier authorizing the purchase of specific products at agreed quantities, prices, and delivery terms.

A formalized process and unique identifier issued to authorize and track the return of a product from customer to seller, governing eligibility, logistics, and resolution.

An order requiring expedited processing and shipping to meet an urgent delivery deadline, typically involving priority handling and premium carrier services.

A document generated by the seller confirming the sale of products to a customer, detailing items, quantities, prices, and delivery terms.

A situation where a product is completely out of stock and unavailable for sale, resulting in lost revenue, disappointed customers, and potential long-term damage to brand loyalty and marketplace rankings.