when an item is on backorder a customer may look elsewhere for a substitute product especially if the expected wait time until the product becomes available is long this can provide an opportunity for once loyal customers to try other companies products and potentially switch their loyalties difficulties with proper inventory management can lead to the eventual loss of market share as customers become frustrated with the company s lack of product availability 
backorders may require additional resources in managing pre orders or clients that are waiting for their product instead of simply carrying inventory and selling it to customers a company must incorporate receiving orders managing obligations coordinating logistics and communicating to specific customers when their product is ready the company may also require heavier use of public communication to monitor the situation and further inform the product s availability some backorders are more important than others when a drug is expected to not be available for a period of time manufacturers must report anticipated shortages with the fda the fda then broadcasts the expected timeline of availability example of backorder