Backorder Fulfillment from Return Stock (SAP Library

Backorder Fulfillment from Return Stock

Use

Merchandise returns are a frequent occurrence in retail, and especially in apparel. The customer may not have liked the article, it didn't fit, the wrong article was shipped was damaged, and so on. If the article is unused and can be readily shipped again, then it is quicker and more cost-effective to use it to fill sales backorders or stock transfer orders rather than to move it back to unrestricted stock and for subsequent picking and reshipment. This function (backorder fulfillment from return stock) allows you to manage how returns are to be allocated for backorders and stock transfers.

Integration

In the Merchandise Distribution component you can specify how (in general) return stock is to be assigned to backorders. For example, suppose you have 150 large blue T-shirts in return stock. You have a backorder of 100 for Customer A and 200 for Customer B. In setting up the merchandise distribution table, you can determine whether the available return stock is to be split evenly between the two backorders (75 for each customer), or 100 to Customer A and 50 to Customer B (so at least one customer gets a full order), or all to Customer B because it has a higher priority, or some other scheme.

Shipping personnel can run the backorder fulfillment program either in the background or online to determine what portion of the return stock is to be used for backorders. (See also Using Return Stock to Fill Backorders.)

Activities

The backorder fulfillment program will most likely be run by shipping department personnel. Although the system automatically determines which customer backorders have priority (based on the appropriate allocation table), the shipping department can determine on a given day:

How much of the return stock is in shippable condition

Whether all or only a portion of the shippable return stock is to be freed for backorders (for example, if some should be held back to bring inventory back up to safety stock level)

For procedural information, see:

Distributing Return Stock Among Backorders