Many Mail Order / eCommerce companies have arrangements with suppliers to Drop Ship their orders. A Drop Ship item is a Product which is not normally held in stock, but which can be sourced and shipped directly from your supplier to your customer.
As an order hits the software system, the system will automatically find any products on the order which are considered to be Drop Ship. Assuming the product is not currently in stock (i.e. returned stock, which is suitable for dispatch), the system will move the drop ship items out of the order and automatically raise a Drop Ship Purchase Order.
As confirmation is received from your supplier that the Drop Ship item has been dispatched, the Drop Ship Purchase Order can be confirmed on the system. As the Drop Ship Purchase Order is Confirmed a Purchase Invoice will automatically be created, the Sales Order will also be confirmed and will be moved to a Dispatch Stage.