Method of fulfilling sales orders by selling products without the order taker handling, stocking, or delivering them.
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Back order
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Configure to Order
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Drop shipments
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Assemble to Order
Drop shipments is a fulfillment method where the seller orders from a supplier who ships directly to the customer. The seller never takes physical possession of the inventory - no handling, stocking, or delivery by the order taker. Back order is about delayed fulfillment, while Configure-to-Order and Assemble-to-Order involve the seller in the production process.
A drop shipment is a fulfillment method where the selling company takes the sales order but has the supplier ship the product directly to the customer, so the order taker never physically handles, stocks, or delivers the goods themselves. This differs from Back Order (delayed fulfillment due to stock shortage), Configure to Order, and Assemble to Order, all of which involve the selling organization physically building or holding the item.