Returns processing manages both vendor returns and customer returns, providing workflows for restocking inventory, processing credits, and maintaining accurate inventory records. Inventory Pro supports Return Merchandise Authorization (RMA) workflows for both purchase order returns and shipping order returns with complete audit trails.
| Return Type | Access Path | Purpose |
|---|
| Purchase Order Returns | Orders → Purchasing → Purchase Orders → Line Items → Returns | Return stock to suppliers from received purchase orders with automatic inventory reduction |
| Shipping Order Returns | Orders → Shipping → Shipping Orders → Line Items → Returns | Process customer returns from shipped orders with restocking and credit processing |
Both return types update inventory in real-time, maintain complete transaction history, and support lot/serial tracking for returned items.
Understanding Returns
Returns processing handles inventory that must be sent back to suppliers or received back from customers. The system tracks which items were originally received or shipped, validates return quantities, and automatically adjusts inventory levels.
Key Concepts:
- Vendor Returns (PO Returns): Items purchased from suppliers that need to be returned due to quality issues, overstock, or supplier requests
- Customer Returns (SO Returns): Items sold to customers being returned due to defects, incorrect orders, or customer requests
- Return Merchandise Authorization (RMA): Formal approval process for accepting returns from customers
- Restocking: Process of returning items to inventory and making them available again
- Credit Processing: Financial adjustment for returned items, typically requiring accounting integration
Return Restrictions:
- Can only return items that were actually received (PO) or shipped (SO)
- Return quantity cannot exceed the original transaction quantity
- Items that have been moved, adjusted, or transferred may require manual corrections
- Lot and serial numbers must match original transaction records
Purchase Order Returns
Purchase order returns process inventory being sent back to suppliers, typically due to quality issues, damaged goods, or supplier restocking agreements.
When to Use PO Returns
Process purchase order returns when:
- Received items are defective or damaged
- Incorrect items were shipped by supplier
- Supplier authorizes return of overstocked items
- Items fail quality inspection
- Supplier recall notification is received
PO Return Workflow
Navigate to Returns
- Orders → Purchasing → Purchase Orders
- Find the purchase order containing items to return
- Select Line Items tab
- Click Returns button
Review Returnable Items
- System displays all items from the purchase order that are eligible for return
- Grid shows: Line number, Item ID, Description, Location, Lot/Serial, Requested Units, Received Units, Current Units, Received Date, Unit of Measure
- Only items still in original received state will appear (unmoved, unadjusted stock)
Enter Return Quantities
- In the “Actual Units” column, enter the quantity being returned to the supplier
- System validates return quantity does not exceed received quantity
- Adjust Unit of Measure if needed (dropdown selection)
- Review location, lot, and serial information for accuracy
Apply Returns
- Click Apply button
- Confirm the return operation
- System issues inventory out of stock (negative adjustment)
- System records transaction with reference to original PO
- Inventory is removed from location shown in grid
Verify Results
- Success message confirms units returned
- Inventory quantities updated in real-time
- Transaction appears in audit trail with reference to purchase order
Important Notes:
- If items don’t appear in the return grid, they may have been moved or adjusted after receiving
- For items that have been relocated, use manual inventory corrections (Inventory → Issue Stock or Inventory → Adjustments)
- Return transactions reference the original PO number for audit purposes
- Requires “PO Returns” and “Negative Adjustment (Issues)” security permissions
Shipping Order Returns
Shipping order returns process customer returns, restocking inventory and optionally adjusting pricing for credit memos or refunds.
When to Use SO Returns
Process shipping order returns when:
- Customer returns defective or damaged items
- Customer received incorrect items
- Customer requests RMA for any reason
- Items shipped were not as described
- Quality issues identified after delivery
SO Return Workflow
Navigate to Returns
- Orders → Shipping → Shipping Orders
- Find the shipping order for the customer return
- Select Line Items tab
- Click Returns button
Review Shipped Items
- System displays all items from the shipping order eligible for return
- Grid shows: Line number, Item ID, Description, Return Location, Lot/Serial, Ordered Units, Shipped Units, Current Units, Unit Price, Reference, Shipped Date
- Only items actually shipped will appear in the return list
Configure Return Details
- Return Location: Select warehouse location where returned stock will be restocked
- Actual Units: Enter quantity being returned (cannot exceed shipped quantity)
- Unit Price: Adjust if credit amount differs from original sale price (e.g., restocking fee)
- System validates location is selected and return quantity is valid
Apply Returns
- Click Apply button
- Confirm the return operation
- System receives inventory back into stock at specified location
- System updates pricing if modified for credit processing
- Inventory is added to selected return location
Verify Results
- Success message shows units returned and restocking location
- Inventory quantities updated in real-time
- Transaction appears in audit trail with reference to shipping order and line number
Important Notes:
- Return location must be selected for each line being returned
- Default return location may be configured per warehouse (Admin Option configuration)
- Unit price adjustments support scenarios like restocking fees or partial credits
- If no units are being returned but price needs adjustment, enter 0 units and modify price only
- Requires “SO Returns” and “Maintain SO Lines” security permissions
- Reference column shows shipping order line reference (RecID-RecNo) for tracking
Credit Processing and Restocking
Restocking Returned Items
Both PO and SO returns automatically update inventory in real-time:
Purchase Order Returns:
- Items are issued (removed) from inventory
- Inventory reduction recorded with negative adjustment transaction
- Stock removed from original receiving location
- Transaction references original purchase order number
Shipping Order Returns:
- Items are received back into inventory
- Inventory increase recorded with return transaction
- Stock added to location selected during return processing
- Transaction references original shipping order line
Quality Control:
- Returned items may need inspection before restocking
- Use dedicated inspection locations for return staging
- Transfer to saleable locations after quality approval
- Use inventory adjustments if items cannot be restocked due to damage
Credit and Refund Processing
Financial processing for returns typically requires accounting system integration:
Shipping Order Returns (Customer Returns):
- Unit price field allows adjustment for partial credits or restocking fees
- Modified prices update the shipping order line for accounting export
- Generate credit memo reports from Orders → Shipping → Reports → Credit Memos
- Credit amounts must be processed through accounting system or ERP integration
Purchase Order Returns (Vendor Returns):
- Return transactions provide documentation for supplier credit requests
- Use audit trail reports to track returned quantities and values
- Coordinate with accounts payable for vendor credit processing
- Supplier credits typically processed outside Inventory Pro system
Common Credit Scenarios:
- Full Credit: Return full quantity at original price
- Restocking Fee: Reduce unit price to reflect restocking charge
- Partial Return: Return subset of original quantity
- Price Adjustment Only: Modify price without physical return (set return quantity to 0)
Return Transaction Audit Trail
All return transactions maintain complete audit trails for compliance and analysis:
Transaction Details Recorded:
- Original order reference (PO or SO number)
- Item identification and description
- Lot and serial numbers
- Quantity returned
- Location information
- Unit pricing (for SO returns)
- User who processed the return
- Date and time of transaction
Audit Reports:
- Inventory transactions by date range
- Purchase order receiving history
- Shipping order issue history
- Item transaction history by part number
- Location transaction history
Review Returns:
- Inventory → Reports → Transaction History
- Orders → Purchasing → Reports → PO History
- Orders → Shipping → Reports → SO History
- Audit Trail → Inventory Transactions