Handling Back Orders

I got an order for a few items last night and was just told by my supplier that one of the items is back ordered.

Is there a seamless way that a customer can go into the store and open up his order, make changes, and have the billing taken care of automatically?

I'm 99% sure that the above is impossible, if so… what to do? It seems like canceling the order and issuing a full refund, and then telling them to place a fresh order is one way to go, but man, what a hassle!

If items need to be substituted is that something that can only be done by me in the back end? And what about re-figuring the shipping?

Yes, I could contact my CC company and have them issue a partial refund, or have them charge the customer a little more (if the order increased in cost), but all this seems like it would be a situation where I'd be having to get out a calculator and figuring things out long hand.

How do you seasoned store owners deal with all this?

You can edit the order through admin step by step. This should not be handled by your customers.

OK, I just played around with it, after acting like a customer and submitting a small sample order.

From what I can see, editing an order involves me adding/removing items, and then having to enter the customers CC info myself. This is essentially creating a brand new order, which means I'd have to go to my CC company and issue a full refund for the original order.

Either way, it involves the customer having to return to the store, take note of the changes they'd want to make with pencil and paper, and then going over things on the phone with me.

Is that about accurate? Is there a better way?

Just change the order (not the payment info) and then go to your payment provider and issue a refund for the difference between the orig order and the new amount.