Advanced Returns Management for Customer Returns

This component enables you to manage customer returns. Functions have been enhanced to support you during the entire returns process.

Customer returns involve the return of goods from a customer to a company location. With Advanced Returns Management, you can handle all returns scenarios, such as returns made at the counter, returns that involve a shipment to the warehouse – including subsequent reverse logistics – and direct shipments from customer to vendor.

At different times during the process, you can refund the customer with a credit memo or compensate them with a replacement material.

Note Note

Customer returns that involve a shipment to other company locations or to external vendors also require supplier returns processing. For more information, see Advanced Returns Management for Supplier Returns.

End of the note.

Advanced Returns Management integrates all the steps involved in returns processing:

Creating the returns order
Recording the material inspection results
Deciding what the logistical follow-up activity should be
Refunding customer returns with a credit memo
Delivering replacement materials free of charge
Monitoring the process

Each step in Advanced Returns Management can be linked to various user roles with different authorizations: sales representative, warehouse manager, warehouse worker, returns manager, returns controller, accounts payable clerk, and inventory manager. If a user does not have the required authorization, a workflow can be set up so that an authorized user can confirm the step, for example.

Advanced Returns Management also provides for the automatic creation and tracking of all the documents necessary for logistical and financial processing. These include returns deliveries, goods movements, returns purchase orders, returns stock transport orders, credit memo requests, subsequent deliveries free of charge, and credit memos.

The following figure illustrates the customer returns process in Advanced Returns Management by means of the associated document flow.

This graphic is explained in the accompanying text.

Document Flow in the Customer Returns Process

Integration

The functions of Advanced Returns Management build on the existing functions of basic returns processing in the Sales and Distribution (SD) component of the SAP Enterprise Resource Planning (SAP ERP) system. For more information about basic customer returns processing, see Returns.
In addition, you can use claims processing in the SAP Customer Relationship Management (SAP CRM) system to trigger customer returns in Advanced Returns Management in SAP ERP. When you release a returns request in the complaints document, the system creates a returns order for Advanced Returns Management in SAP ERP. You can monitor the entire returns process in the complaints document. To enable this, data is transmitted from Advanced Returns Management to the complaints document in SAP CRM. The integration of Advanced Returns Processing in SAP ERP and claims processing in SAP CRM enables you to use the SAP CRM user interface for entering returns more efficiently.
For more information, see SAP Library for SAP CRM on SAP Help Portal at http://help.sap.com/crm SAP Customer Relationship Management SAP EHP2 for SAP CRM 7.0 Application Help Service Claims and Returns Integration of Claims and SAP ERP Advanced Returns Management .
For customer returns and store returns you can now use the logistical processing of returned materials in the warehouse in the SAP Extended Warehouse Management (SAP EWM) system. After posting the goods issue, you can map internal, logistical warehouse processes such as transferring the material from the goods receipt zone to a work center for quality inspection. During quality inspection in SAP EWM, you can also specify that you want the logistical follow-up activities to be defined in SAP ERP.
For more information, see SAP Library for SAP SCM on SAP Help Portal at http://help.sap.com/scm SAP Supply Chain Management (SAP SCM) SAP Extended Warehouse Management (SAP EWM) SAP EWM 7.0 EHP2 SAP Extended Warehouse Management (SAP EWM) Quality Management (QM) Advanced Returns Management .

Features

Returns Order

You trigger the customer returns process with a returns order. The returns order contains information that serves as the basis for subsequent processing of the returned material in Logistics and Financial Accounting, such as the automatic creation of logistical follow-up documents as well as documents for refunding the customer.

Material Inspection

You can record the results of a material inspection in which the returned materials have been checked.

Sales representatives and warehouse employees can enter inspection results directly in the returns order for materials that have been returned at the counter or have been shipped to the warehouse without prior announcement.

For materials that have been returned to a company location, warehouse employees can use the Material Inspection in Warehouse transaction to enter the inspection results for the returns delivery belonging to the returns order.

Logistical Follow-Up Activities

You use logistical follow-up activities to specify the next step in the logistical processing of a returned material. Examples of logistical follow-up activities include Immediately Move to Free Available Stock, Ship to Vendor, and Transfer to Scrap. Sales representatives or warehouse employees can enter the information required for the selected logistical follow-up activity directly in the returns order for materials that have been returned at the counter or that have been shipped to the warehouse without prior announcement. For materials that have been returned to a company location, warehouse employees can use the Material Inspection in Warehouse transaction to enter the required information for the returns delivery belonging to the returns order.

Automatic Creation of Follow-Up Documents

The system automatically creates the follow-up documents. It does so based on the logistical follow-up activity and refund control that have been specified. Follow-up documents include returns deliveries, goods movements, returns stock transport orders, returns purchase orders, and repair orders.

Compensation for Customer Returns

When a customer returns a material, you can issue a credit memo as refund or send a replacement material as compensation. If you issue a credit memo, you specify the refund amount. If you send a replacement, you specify the exact replacement material and quantity. You can trigger compensation at any time either right in the returns order, in the Material Inspection in Warehouse transaction, or via the Customer Refund Determination transaction.

If you release the refund in the returns order, the system creates a credit memo or a subsequent delivery free of charge. If you release the refund in the Customer Refund Determination transaction, the system creates a credit memo request or a subsequent delivery free of charge.

In the returns order, sales representatives specify how and when the customer should be compensated: Even if a sales representative specifies that the customer should be compensated at a later time, he or she can still specify the refund amount or replacement material. This is then available in the Material Inspection in Warehouse and Customer Refund Determination transactions.

Non-Valuated Returns Stock

You have the option of initially posting the goods receipt for returned materials to non-valuated stock. The logistical follow-up activities are then based on this non-valuated returns stock. In particular, you can use non-valuated returns stock for forwarding processes such as store returns and supplier returns. You can even scrap the materials from the non-valuated returns stock.

The returned materials are valuated when you decide that the material is to change ownership from the customer to your company. The system then automatically triggers a goods movement to post the returned material to valuated stock. A change in ownership occurs when you grant the customer a refund or replacement for the returned material (a credit memo, a credit memo request without billing block, or a subsequent delivery free of charge), or when you specify a logistical follow-up activity signaling that you intend to take on ownership, such as by transferring the material to unrestricted-use ("free available") stock.

Customer Returns Overview

The returns overview provides you with an overview of all the steps in the returns process, all the logistical follow-up documents created as part of the process, as well as information on the status of logistical processing and compensation.

Example

The following are examples of some typical customer returns scenarios that can be processed with Advanced Returns Management.

The customer contacts the local branch or distribution center and informs the internal sales representative that he or she wants to return some goods that are still at the customer site. The sales representative creates a returns order to initiate the return of materials to a company location.
The customer contacts the local branch or distribution center and informs the internal sales representative that he or she wants to return some goods that are still at the customer site. The sales representative decides that the materials must be returned directly to the vendor. This is often the case when the materials have been shipped to the customer by third party delivery from the vendor. The sales representative creates a returns order to initiate the return of materials directly to the vendor.
The customer calls an internal sales representative and informs him that she wants to return some goods. However, the sales representative decides to perform the inspection at the customer site before initiating a physical return. A typical reason for this is that the expected costs for the transport are higher than the cost of an inspection at the customer site. Once the inspection has been performed and the results communicated, the sales representative can decide whether or not to have the goods returned.
The customer either returns the goods to the counter directly, or ships them to a warehouse or distribution center without advance notice. During a normal delivery to the customer site, for example, the customer might give the goods he wants to return to the deliverer. Shipment to a company location without advance notice is also called an unplanned return.
The customer contacts the local branch or distribution center and informs the internal sales representative that he or she wants to return some goods. However, the sales representative does not find out exactly which goods and which quantities will be returned. He or she therefore creates a returns order with a special order item to trigger the return of the unknown materials to a company location.