Hey Kuroda,
I can’t see the other person’s reply to your questions (seems like it’s been deleted), so my answers may have overlapped info with his.
1. Are pre-orders allowed:
Yes, lots of Shopify businesses do pre-orders. You need to estimate and state when the pre-order product will be shipped. If there are any delays (which they’ll often happen), you’ll need to provide customers with an update (e.g. send them an email) and let them know the new ETA, and that they have the right to cancel their pre-order or request a refund.
2. Using money from pre-orders to pay your manufacturer:
It usually takes a few business days for the customers’ payments to land in your business bank account. I think the challenge for you would be to get enough pre-order sales to meet your manufacturer’s MOQ and initial deposit. New brands that don’t have social capital and customer trust will find it hard to get pre-order sales.
Also keep in mind for pre-orders, your customers can only use Shopify Payments and PayPal. Other payment methods like Apple Pay, Google Pay, Buy Now Pay Later aren’t supported.
3. What you need to look out for:
One of the biggest risks for you would be having pre-order delays (could be due to shipping, or you’re not happy with the samples etc.) - leading to customers asking for refunds due to long waiting times. You would be left in a hard place financially - paid the manufacturer for poor quality products; no money to refund your customers.
4. If you do want to run pre-orders:
Set very clear customer expectations upfront across your website and in your store policies, so your customers know they’re placing a pre-order and can’t complain to you later saying they weren’t aware about it. I’ve recently published two articles on How to Offer a great Pre-order Customer Experience and How to create a Shopify Pre-order Policy. They should help. I’ll ping you when I’ve added templates to these articles.
5. My unsolicited advice:
Even though we run a Shopify pre-order & partial deposit app (Early Bird) and talk about how pre-orders can help secure cash flow earlier and avoid lost sales, the truth is not every apparel brand is suited to do pre-orders right away.
Saving up capital to go the pre-made route would be less financially risky for you, for a few reasons.
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You need to find your brand positioning and build up social capital (demand) first
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You need to find a reliable manufacturer (for your product quality, lead time and shipping)
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You need to build your customers’ trust (which will help with pre-order sales and reduce refunds)
Happy to chat further and hope you don’t mind the unsolicited advice. If you end up deciding to do pre-orders instead of pre-made, give me a ping - our Pre-order app has a 100% Free Starter plan, with no commission fees. Otherwise you can DIY manually too. Just add the pre-order info to the product description, or buy a premium theme with built-in functionalities.
I haven’t mentioned partial deposits since you haven’t asked - but let me know and I can answer about that as well.
Good luck with your venture!
Jo