diff --git a/app/controllers/spree/api/shipments_controller_decorator.rb b/app/controllers/spree/api/shipments_controller_decorator.rb
index 6d63d0d412..6fb5e242ec 100644
--- a/app/controllers/spree/api/shipments_controller_decorator.rb
+++ b/app/controllers/spree/api/shipments_controller_decorator.rb
@@ -2,38 +2,46 @@ require 'open_food_network/scope_variant_to_hub'
 
 Spree::Api::ShipmentsController.class_eval do
   def create
-    variant = Spree::Variant.find(params[:variant_id])
-    OpenFoodNetwork::ScopeVariantToHub.new(@order.distributor).scope(variant)
-
+    variant = scoped_variant(params[:variant_id])
     quantity = params[:quantity].to_i
-    @shipment = @order.shipments.create(:stock_location_id => params[:stock_location_id])
+    @shipment = get_or_create_shipment(params[:stock_location_id])
+
     @order.contents.add(variant, quantity, nil, @shipment)
 
     @shipment.refresh_rates
     @shipment.save!
 
-    respond_with(@shipment.reload, :default_template => :show)
+    respond_with(@shipment.reload, default_template: :show)
   end
 
   def add
-    variant = Spree::Variant.find(params[:variant_id])
-    OpenFoodNetwork::ScopeVariantToHub.new(@order.distributor).scope(variant)
-
+    variant = scoped_variant(params[:variant_id])
     quantity = params[:quantity].to_i
 
     @order.contents.add(variant, quantity, nil, @shipment)
 
-    respond_with(@shipment, :default_template => :show)
+    respond_with(@shipment, default_template: :show)
   end
 
   def remove
-    variant = Spree::Variant.find(params[:variant_id])
-    OpenFoodNetwork::ScopeVariantToHub.new(@order.distributor).scope(variant)
-
+    variant = scoped_variant(params[:variant_id])
     quantity = params[:quantity].to_i
 
     @order.contents.remove(variant, quantity, @shipment)
     @shipment.reload if @shipment.persisted?
-    respond_with(@shipment, :default_template => :show)
+
+    respond_with(@shipment, default_template: :show)
+  end
+
+  private
+
+  def scoped_variant(variant_id)
+    variant = Spree::Variant.find(variant_id)
+    OpenFoodNetwork::ScopeVariantToHub.new(@order.distributor).scope(variant)
+    variant
+  end
+
+  def get_or_create_shipment(stock_location_id)
+    @order.shipment || @order.shipments.create(stock_location_id: stock_location_id)
   end
 end
diff --git a/spec/controllers/spree/api/shipments_controller_spec.rb b/spec/controllers/spree/api/shipments_controller_spec.rb
new file mode 100644
index 0000000000..184cd49444
--- /dev/null
+++ b/spec/controllers/spree/api/shipments_controller_spec.rb
@@ -0,0 +1,113 @@
+require 'spec_helper'
+
+describe Spree::Api::ShipmentsController, type: :controller do
+  render_views
+
+  let!(:shipment) { create(:shipment) }
+  let!(:attributes) { [:id, :tracking, :number, :cost, :shipped_at, :stock_location_name, :order_id, :shipping_rates, :shipping_method, :inventory_units] }
+
+  before do
+    allow(controller).to receive(:spree_current_user) { current_api_user }
+  end
+
+  context "as an admin" do
+    let!(:order) { shipment.order }
+    let(:order_ship_address) { create(:address) }
+    let!(:stock_location) { create(:stock_location_with_items) }
+    let!(:variant) { create(:variant) }
+    let(:params) do
+      { quantity: 2,
+        variant_id: stock_location.stock_items.first.variant.to_param,
+        order_id: order.number,
+        stock_location_id: stock_location.to_param,
+        format: :json }
+    end
+
+    before do
+      order.update_attribute(:ship_address_id, order_ship_address.id)
+    end
+
+    sign_in_as_admin!
+
+    context '#create' do
+      it 'creates a shipment if order does not have a shipment' do
+        order.shipment.destroy
+        order.reload
+
+        spree_post :create, params
+
+        validate_response
+        expect(json_response["inventory_units"].size).to eq 2
+        expect(order.reload.line_items.first.variant.price).to eq(variant.price)
+      end
+
+      it 'updates and returns exiting shipment, if order already has a shipment' do
+        original_shipment_id = order.shipment.id
+
+        spree_post :create, params
+
+        expect(json_response["id"]). to eq(original_shipment_id)
+        validate_response
+        expect(json_response["inventory_units"].size).to eq 2
+        expect(order.reload.line_items.first.variant.price).to eq(variant.price)
+      end
+
+      it 'updates existing shipment with variant override if an VO is sent' do
+        hub = create(:distributor_enterprise)
+        order.update_attribute(:distributor, hub)
+        variant_override = create(:variant_override, hub: hub, variant: variant)
+
+        spree_post :create, params
+
+        validate_response
+        expect(json_response["inventory_units"].size).to eq 2
+        expect(order.reload.line_items.first.price).to eq(variant_override.price)
+      end
+    end
+
+    context 'for a completed order with shipment' do
+      let(:order) { create :completed_order_with_totals }
+
+      before { params[:id] = order.shipments.first.to_param }
+
+      it 'adds a variant to the shipment' do
+        spree_put :add, params
+
+        validate_response
+        expect(inventory_units_for_variant(json_response["inventory_units"], variant).size).to eq 2
+      end
+
+      it 'removes a variant from the shipment' do
+        params[:variant_id] = order.line_items.first.variant.to_param
+        params[:quantity] = 1
+
+        spree_put :remove, params
+
+        validate_response
+        expect(inventory_units_for_variant(json_response["inventory_units"], variant).size).to eq 0
+      end
+
+      it 'adds a variant override to the shipment' do
+        hub = create(:distributor_enterprise)
+        order.update_attribute(:distributor, hub)
+        variant_override = create(:variant_override, hub: hub, variant: variant)
+
+        spree_put :add, params
+
+        validate_response
+        expect(inventory_units_for_variant(json_response["inventory_units"], variant).size).to eq 2
+        expect(order.reload.line_items.last.price).to eq(variant_override.price)
+      end
+
+      def inventory_units_for_variant(inventory_units, variant)
+        inventory_units.select { |unit| unit['variant_id'] == variant.id }
+      end
+    end
+
+    def validate_response
+      expect(response.status).to eq 200
+      attributes.all?{ |attr| json_response.key? attr.to_s }
+      expect(json_response["shipping_method"]["name"]).to eq order.shipping_method.name
+    end
+  end
+end