DEFINITION of 'Backorder'

An order for a good or service that cannot be filled at the current time due to a lack of available supply. The higher the number of items backordered, the higher the demand for the item.


Backorders are an important factor in inventory management analysis. If a company consistently sees items in backorder then this could be taken as a signal that it is running too lean - and that it is losing out on business by not providing the products demanded by its customers.

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    The body of accounting that deals with valuing and accounting ...
  4. Carrying Cost Of Inventory

    This is the cost a business incurs over a certain period of time, ...
  5. Inventory Turnover

    Inventory Turnover is a ratio showing how many times a company's ...
  6. Inventory

    The raw materials, work-in-process goods and completely finished ...
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