Complete Order Management Workflow

Why This Tutorial Matters

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.

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.

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
  • A staging store (recommended) with email sending configured (Stores > Configuration > Sales > Sales Emails) or disabled for testing
  • At least one enabled payment method for testing (e.g., Check/Money Order) and one shipping method (e.g., Flat Rate)
  • 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:

  • Symptom: Invoice button is missing

    • Likely cause: Payment method auto-invoices, or the order is in Payment Review
    • Fix: Check the Invoices tab and your payment method settings; resolve Payment Review before invoicing

  • Symptom: Ship button is disabled

    • Likely cause: Items are virtual/downloadable or there is no shippable quantity
    • Fix: Verify product type; for MSI, confirm salable quantity and source assignment; ensure items are invoiced when required by your flow

  • Symptom: Cannot create shipment due to insufficient quantity

    • Likely cause: Reservations (MSI) or incorrect source selection
    • Fix: Check Salable Qty and Source assignments; adjust stock or choose a different source; reattempt shipment

  • Symptom: Emails not sent

    • Likely cause: Sales Emails disabled or cron not running
    • Fix: Verify Stores > Configuration > Sales > Sales Emails; ensure cron is running; check email queues/logs

  • Symptom: Cannot cancel an order

    • Likely cause: Order already invoiced or shipped
    • Fix: Use Credit Memo to refund instead of canceling

  • Symptom: Refund Online option unavailable

    • Likely cause: Payment method does not support online refunds
    • Fix: Use Refund Offline and process the refund in your payment gateway if needed

Continue Learning

  • 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
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