Return Reasons are used to record a reason an item was returned when the sales credit is entered.
There are many different reasons for entering credits, for example, wrong size, wrong colour, damaged item, wrong item sent. Setting up Return Reasons allows you to analyse the reasons for raising credits in your business to help you identify potential problem areas to focus on improving.
The use of Return Reasons in credit note entry is optional. You can enter a single Return Reason for the whole credit docket, or you can enter different Return Reasons for each line-item on the transaction.
You can view quantity and values posted against each Return Reason in three different ways:
- Order Statistics
- End of Day Return Reason reporting
- Sales Analysis Return Reason reporting
There are various summary and detailed reports available that can be broken down by product, customer and stock location.
For Point-Of-Sale (POS), one Return Reason is reserved to indicate an exchanged item, and you can configure POS so that entering a Return Reason is mandatory.
Besides data analysis, Return Reasons can also be used to write-off stock that is damaged at the same time the sales credit is processed.
Examples
Change of mind
A customer comes back to a store to return all of 3 items purchased the day before because they changed their mind. You would enter the original sale docket number, choose return reason ‘Change of Mind’ and process the credit. Since the items are not damaged and can be re-sold they are moved back to stock.
Damaged Item
A customer has come back to store with a damaged item and does not want the other 2 items from the sale, because without the damaged item they are not useful. You would enter the original sale docket number, choose a reason like ‘Change of Mind’ (or leave blank), and then for the damaged item, set the reason for that to ‘Damaged’. When the credit is processed, the two ‘good’ items are returned to stock, but the other damaged item is returned to stock, but then immediately issued out of stock and written off to the expense account nominated on the Return Reason Code. The damaged item is binned or sent back to the supplier depending on the details.
Wrong Size
You receive a returned item from an online sale because it is the wrong size. You create a credit note and enter the original invoice docket reference and choose ‘Wrong Size’. Later when you are reviewing ‘Reasons for Returns Stats’ you notice there are a large number of returns for the reason of ‘Wrong Size’. On investigating, you find a product label problem with stock in the distribution centre.
Panel Options
- Standard panel features
- Maintenance
- Views
- Audit – lists data changes made over time to the Return Reason currently being viewed
- Returns for Year – shows a 12-month comparison of this year and last year’s returns for the Return Reason currently being viewed
- Reports
- List Return Reasons
- Several Return Reasons reports (note the data for these reports is updated during the overnight EOD processing so they don’t contain returns created “today”)