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On Backorder is completely optional and can be enabled on a select few, or all, products.
For example, on the demonstration website, there is a Smocked Cushion that is In Stock and can be ordered:
There is a Cornucopia Cushion that is Out of Stock and cannot be ordered:
And there is a Violet Cushion that is displayed as On Backorder as the stock has hit 0, but can still be ordered:
