Complete Order Management Workflow

20-30 minutes Advanced Tutorial

Compatibility

Magento Open Source and Adobe Commerce 2.4.x. MSI (Multi-Source Inventory) is enabled by default. RMA features are Adobe Commerce only and not covered here. With MSI (Magento 2.3+), stock is reserved at order placement and deducted when you create a shipment. The legacy "Decrease Stock When Order is Placed" setting does not apply with MSI enabled.

Why This Tutorial Matters

This tutorial provides an end-to-end workflow for processing orders from placement to delivery, helping you streamline order-to-cash, accelerate payment capture, and ship on time to improve customer satisfaction.

Business Impact: Streamline order-to-cash, accelerate payment capture, and ship on time to improve customer satisfaction. Reduce cancellations, chargebacks, and inventory discrepancies through accurate invoicing, shipping, and refunds.

What You'll Achieve: Confidently process a test order end-to-end: review the order, create an invoice, create a shipment with tracking, and issue a partial refund via credit memo—while keeping inventory accurate.

Learning Journey Overview

Your Situation

You manage daily orders and need a reliable, repeatable process to capture payments, ship accurately, handle exceptions, and keep inventory correct—without slowing down your team or confusing customers.

What You'll Learn

By completing this tutorial, you will:

  • Navigate Sales > Orders and interpret order states vs. statuses
  • Create invoices (capture online/offline) and partial invoices
  • Create shipments with tracking; perform partial shipments (MSI-aware)
  • Issue refunds via Credit Memo (full and partial) and restock returned items
  • Handle exceptions: hold, cancel, payment review, and virtual orders
  • Verify customer email notifications and print documents
  • Understand inventory reservations (MSI) and salable quantity

Success Criteria

You'll know you've succeeded when:

  • The order status progresses from Pending to Processing to Complete (for physical goods)
  • The customer receives Order, Invoice, and Shipment emails
  • A partial Credit Memo is issued and inventory is restocked for returned items
  • Order and item quantities correctly reflect invoiced, shipped, and refunded values
  • Operational targets: Processing orders aged >24h are <5% of total; refund turnaround <48h

Time Investment

  • Estimated time: 20-30 minutes
  • Skill level after completion: Confident with day-to-day order operations and exception handling
  • Business value unlock: Faster capture-to-cash, fewer support tickets, and reduced inventory discrepancies

Before We Start

Who This Is For

This tutorial is designed for:

  • Store owners and operations managers responsible for order fulfillment
  • Customer service agents handling invoicing, shipping, and refunds
  • New staff onboarding to Sales > Orders workflows

What You Need

Make sure you have:

Admin Access

With role permissions: Sales > Operations > Orders, Invoices, Shipments, Credit Memos

Staging Store

Recommended with email sending configured or disabled for testing

Payment Method

At least one enabled payment method for testing (e.g., Check/Money Order)

Product Stock

One in-stock simple product assigned to a source/stock (MSI) with positive salable quantity

Preparation Checklist

Before starting, complete these preparation steps:

  • Enable Check/Money Order: Stores > Configuration > Sales > Payment Methods > Check/Money Order = Yes
  • Enable Flat Rate shipping: Stores > Configuration > Sales > Shipping Methods > Flat Rate = Enabled
  • Verify Sales Emails: Stores > Configuration > Sales > Sales Emails > enable Order, Invoice, Shipment, and Credit Memo emails
  • Confirm product stock and MSI: Catalog > Products > ensure product is In Stock and Salable Qty > 0; assign to a Source if using MSI
  • Ensure cron is running for emails and order processing automation

Step-by-Step Learning Path

1

Place a test order

Goal: Create a new order to process end-to-end.

Path: Storefront checkout using your test payment and shipping methods.

Actions:

  • Add the test product to cart, proceed through checkout, place order

Verify: In Admin, go to Sales > Orders and confirm the new order appears. Status is typically Pending (or Processing if your gateway auto-invoices).

2

Review the order

Goal: Validate payment, shipping, and items before invoicing.

Path: Admin > Sales > Orders > click the order.

Actions:

  • Check Payment & Shipping Method, Items Ordered, customer email, and Order Comments

Verify: Details are accurate; no discrepancies that require Hold or Cancel.

3

Create an invoice (capture payment)

Goal: Capture funds and record revenue for billable items.

Path: In the order view, click Invoice.

Actions:

  • Optionally adjust quantities for a partial invoice
  • Choose Capture Online (if supported by the gateway) or Capture Offline
  • Click Submit Invoice and Send Email

Verify: Order status typically moves to Processing; Invoices tab lists the invoice; the customer receives an invoice email.

4

Create a shipment (fulfillment)

Goal: Deduct inventory, create a shipment, and notify the customer.

Path: In the order view, click Ship.

Actions:

  • If MSI is enabled: select Source(s) and quantities per item. Use Source Selection recommendations if available
  • Add Carrier and Tracking Number(s) as applicable
  • Check Send Shipment Email and click Submit Shipment

Verify: Shipments tab lists the shipment with tracking; the customer receives a shipment email. For non-virtual items, once all items are invoiced and shipped, the order status becomes Complete.

5

Print documents (optional)

Goal: Generate documents for packing or record-keeping.

Path: From the order view or Sales > Orders grid.

Actions:

  • Use Actions to Print Invoices or Print Packing Slips

Verify: Documents download or print successfully.

6

Handle exceptions: Cancel or Hold

Goal: Pause or stop processing when needed.

Path: Order view.

Actions:

  • Before invoicing/fulfillment, click Cancel to void the order or Hold to pause
  • Use Unhold to resume when ready

Verify: Order status updates to Canceled or On Hold accordingly.

7

Issue a refund (Credit Memo)

Goal: Process returns or adjustments and restock items.

Path: From the order view (or an invoice), click Credit Memo.

Actions:

  • Adjust quantities, select Return to Stock where appropriate
  • Choose Refund Online (if supported) or Refund Offline
  • Add a comment and send email

Verify: Credit Memos tab lists the refund; inventory increases for returned items; customer receives credit memo email.

Notes

  • Virtual/Downloadable products: No Shipment step; order can Complete after invoicing
  • Payment Review: If present, complete your gateway's review/accept/deny flow before invoicing
  • Auto-invoicing: Some gateways create invoices automatically upon capture

Practice and Reinforcement

Now that you've learned the core process, let's reinforce your skills:

  • Perform a partial shipment (split an order across two shipments)
  • Create a partial invoice for one line item and complete it later
  • Issue a partial refund for one item and restock it
  • Create a Saved View in Sales > Orders to filter Processing orders older than 48 hours

What You've Accomplished

Congratulations! You have successfully:

  • Reviewed a new order and verified customer and payment details
  • Created an invoice and captured payment
  • Created a shipment with tracking and sent notifications
  • Issued a partial refund via Credit Memo and restocked returned items
  • Verified status transitions and document records (Invoices/Shipments/Credit Memos)

Business Impact

Expected impact: Reduce time-to-capture by 30-50%, decrease order handling errors, and improve on-time shipment rate. Track metrics: Processing orders aging, capture-to-ship lead time, refund turnaround, and cancellation rate.

Skills Gained

You now have the ability to:

  • Operate end-to-end order processing confidently in Sales > Orders
  • Capture payments correctly (online/offline) and manage invoices
  • Ship with tracking and manage partial shipments under MSI
  • Process refunds via Credit Memo and restock inventory
  • Troubleshoot common issues that block invoicing or shipping

Next Steps in Your Journey

Now that you've mastered this process, here's how to build on your success:

Immediate Actions

  • Create Saved Views for Pending, Processing, and Backorder queues; enable shipment and invoice emails if not already active

Level Up Your Skills

  • Configure email templates for brand consistency
  • Set up user roles with least privilege for CS agents to minimize errors

Advanced Applications

  • Adobe Commerce: Explore Purchase Orders and Approval workflows
  • Integrate shipping carriers for live rates and label printing

When Things Don't Go as Expected

Even experienced merchants encounter challenges. Here's how to handle common situations:

Continue Learning

Related Tutorials

  • Processing Partial Shipments
  • Managing Credit Memos and Returns

How-To Guides

  • Create an Invoice
  • Create a Shipment
  • Issue a Credit Memo
  • Configure Sales Emails

Reference Materials

  • Order States and Statuses
  • MSI Overview
  • Payment Methods configuration

Summary

You've learned a complete, MSI-aware order management workflow—reviewing orders, invoicing, shipping with tracking, and issuing refunds—while keeping inventory accurate and customers informed.

Key Takeaways

  • Invoice to capture payment; ship to fulfill and deduct stock (with MSI)
  • Use Credit Memos for refunds and restocking
  • Monitor Processing queues and email notifications to maintain throughput

Remember

  • With MSI, stock is reserved at order placement and deducted at shipment—not at order creation
  • Clear Saved Views and role-based permissions reduce errors and speed up operations
DavidLambauer DavidLambauer 92 1 carl-simpson carl-simpson 8 2
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