What do Order Types do?

On their own, nothing—they are used to trigger Rules and Notifications. Down the road, they will cause differences in batching and picking.

If you assign an Order Type, you can pick up on it via Rules, and search for groups of Orders by Type. You could, for example, set up a rule which assigns a specific Template to all Dropship Orders.

Setting an Order Type

Order Creation

All orders are Direct to Consumer by default. You can override this within the "Options" tab when manually creating an Order:

Order Type option when you "Create an Order" 

Order Action

Use a Bulk Action or individual Order Action to "Set Order Type" any time before orders are Batched.

Notifications

It's possible to subscribe to different Notifications depending on the Order Type. You could therefore be notified when Wholesale orders are packed.

Navigate to Notifications in the upper-right customer menu to create a new Notification.