AX2009_ENUS_TL1_10

Chapter 10: Customer Returns

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CHAPTER 10: CUSTOMER RETURNS Objectives

The objectives are:

• Set up reason codes, disposition codes, and miscellaneous charges for customer returns

• Work with disposition actions • Create a Return order and navigate the Return order form • Process the arrival of a Return order • Handle returned items in quarantine inspection • Create a Replacement order • Explore reports and statistics to use for Customer returns

Introduction A customer may return an item to a company for various reasons. For example, it may be defect or not fulfill the customer's expectations.

The return process begins when you receive a request from a customer to return an item and create a Return order in Microsoft Dynamics® AX 2009.

Additionally, reports can be printed to determine:

• The volume of returns for each item or customer • The time that is spent on handling customer returns • How well the return process is managed

Microsoft Official Training Materials for Microsoft Dynamics ® Your use of this content is subject to your current services agreement

Trade and Logistics I in Microsoft Dynamics® AX 2009

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Scenarios: Customer Returns The Customer Returns scenarios in this lesson show how to create, confirm the arrival of, and inspect the returned items. The final two scenarios show the final procedures of processing the Sales order and updating the Return order.

Scenario: Create a Return Order

A customer contacts Lisa in customer service. Apparently, there are problems with the latest order that he or she received. Specifically, some delivered items are defect, and one item did not meet the customer's needs.

Lisa finds the reference number of the order and creates new Return orders for the customer. By using the reference number, Lisa finds the Sales order and views the ordered items. The customer explains the following:

• Item A was damaged during shipment • Item B does not function • Item C is not intact • Item D is unwanted. The color was not what the customer was

expecting

Lisa validates and selects the various items one by one from the Sales order she found. In support of the later inspection or troubleshooting process, Lisa enters the expected return quantity, Estimated Time of Arrival (ETA) for the items, a reason code, and any additional information that the customer provided.

NOTE: The Reason code is a Return order header property. This means that, in this example, that Lisa is creating four different Return orders.

Lisa informs the customer of the deadline for returning the items and the address of the warehouse. Finally, she sends the Return order document in paper or electronic form to the customer. The Return order document contains the Return Materials Authorization (RMA) number which authorizes the customer to return goods to the company.

Scenario: Receive the Returned Items

Ten days pass, and Sammy, who is responsible for shipping and receiving, receives the returned items at the return warehouse. Sammy views the accompanying Return order documents, evaluates the returned items, and counts and checks them against the Return orders.

Sammy will open the Arrival overview form, find the arrival among the other returns, and create a new Item arrival journal. Because of the imposed requirement for inspection, Sammy will specify that the item must be inspected for each journal line. He then posts the arrival journal.



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NOTE: Inspection means that the items will pass through Quarantine orders and to the Quarantine warehouse.

Had the company policy permitted Sammy to make decisions of how to dispose of the returned items, he may have applied a disposition code to the journal line instead of sending the item(s) to inspection.

Scenario: Confirm the Arrival of Returned Items

Lisa, in customer service, is notified that the returned items have arrived. She mails the customer a confirmation that the returned items have arrived at the return warehouse and additional investigations will begin.

Scenario: Inspect the Returned Items in Quarantine

Ricardo, the quality controller, has received four Quarantine orders and the returned items, and now starts to inspect them. He examines the described symptoms and descriptions to ensure that those are correct.

When the inspection is complete, Ricardo updates the Quarantine orders with the following information:

• Item A is not functioning, it receives disposition code “61 -Scrap item, credit customer” with disposition action: Scrap. The customer will be credited and the item will be scrapped.

• Item B has been delivered with the wrong antenna. It receives disposition code “31 - Replace item, credit customer” with disposition action: Replace and credit. Ricardo or Lisa, the customer service representative, will specify a replacement item. The customer will be credited, and replacement item will be entered on a new Sales order.

• Item C must be repaired. It receives disposition code “51” with disposition action: Return to customer. The item will be repaired and eventually returned to the customer. The customer will be invoiced for charges, and parts according to company policy.

• Item D is working fine, and is put back into inventory; it receives disposition code “11 - Put item back in to inventory, credit customer with disposition action: Credit. The customer will be credited and item will be put into inventory again.

Ricardo cannot end the Quarantine order for the item C, until it is repaired.

The remaining three Quarantine orders can be ended by Ricardo. Ending the orders will transfer the information about disposition codes back to the Return order lines, making them available for additional processing by Susan, the order processor.



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Scenario: Process the Return Order

Susan, the order processor, packing slip updates the Return orders to receive the returned items into inventory, and to create Replacement orders if required.

Scenario: Update the Return Order

Item C has been through inspection, and is repaired and ready to be shipped back to the customer.

Ricardo, the quality controller, can end the Quarantine order. This enables Susan, the order processor, to send the repaired item back to the customer and close the Return order.

Scenario: Invoice a Return Order

Susan creates the credit notes and invoices for the Return orders. At this point, Susan can add charges.

The invoice for a Return order can only be performed from the Sales order form and not the Return order form.

Set Up Customer Returns Returns can be categorized according to return reasons or methods of disposition, and specific charges can be combined with the various return categories.

Set Up Customer Returns discusses how to set up Microsoft Dynamics AX 2009 to work with customer returns.

Return Reason Codes

Applying reason codes on returns can help simplify the analysis of return patterns. The reason codes are set up is to determine why a customer wants to return item(s). Some companies may have many reason codes, and will group the reason codes for better overview and for accumulated reporting.



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The figure, Reason codes form, is an example of how to set up the return reason codes in Microsoft Dynamics AX 2009.

FIGURE 10.1 REASON CODES FORM

Procedure: Set Up Return Reason Code Groups

To set up return reason code groups, follow these steps:

1. Open the Return reason code groups form from Accounts receivable > Setup > Sales order > Returns > Return reason code groups.

2. On the Overview tab, specify the name of the return reason code group and enter a description.

3. Close the form.

Procedure: Create a Return Reason Code

To create a return reason code, follow these steps:

1. The Return reason code form can be opened from Accounts receivable > Setup > Sales order > Returns > Return reason code or from the Return reason code groups form, by clicking the Return reason codes button.

2. Enter the name of the reason code and a description. 3. From the Return reason code group field, select the return reason

code group to link to the reason code. 4. Close the form.

The reason codes are applied in the Return order header.



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Disposition Codes

Disposition codes are also a part of the customer returns setup; they determine what will happen to the returned items from both a physical and a financial perspective. The available options are defined by the disposition actions.

As part of the item arrival and inspection, a disposition code will be assigned to the returned goods.

In addition to determining how to dispose of the returned goods, disposition codes can cause miscellaneous charges to be applied to the return line and may additionally be used to group returns for statistical analysis.

The figure, Disposition codes form, is an example of how to set up a disposition code in Microsoft Dynamics AX 2009.

FIGURE 10.2 DISPOSITION CODES FORM

A disposition code can be applied when:

• Creating the Return order • Registering item arrival • Ending a Quarantine order



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Disposition Actions

Microsoft Dynamics AX 2009 has six predefined disposition actions that define the combination of the following:

• The physical handling of the returned item • The financial effect of the return transaction • If a replacement item must be sent to the customer

The Disposition actions and definitions are provided in the table.

Disposition action Definition Credit Return the item to inventory, then credit the customer.

Credit only Credit the customer and do not return the item. Or, if the customer scraps the item, credit the customer. The Credit only disposition action is available from the Return order form only, as part of when you create the Return order.

Scrap Scrap the item, then credit the customer.

Replace and scrap Scrap the item, create a replacement order, then credit the customer.

Replace and credit Return the item to inventory, create a replacement order, then credit the customer.

Return to customer Reject the returned item, and return it to the customer.

Procedure: Create a Disposition Code

To create a disposition code, follow these steps:

1. Open the Disposition codes form from Accounts receivable > Setup > Sales order > Returns > Disposition codes.

2. Enter the name for the disposition code and the description. 3. In the Action field, select an action for the disposition code. 4. Close the Disposition codes form.

Miscellaneous Charges

Many companies want customers to pay either a return fee or special return handling charges.

You can set up miscellaneous charges as a standard fee based on a return reason code or disposition code, or you can add them manually to the order header or lines.



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Example of Fees

Here are examples of the setup of a reason code and disposition code for miscellaneous charges.

Reason code Miscellaneous charge Customer return/Unwanted item 15 percent handling fee

Disposition code Miscellaneous charge Item repaired Ten percent repair charge

Set up miscellaneous charges for reason codes by clicking the Misc. charges button in the Reason codes form.

For the disposition codes, set up miscellaneous charges by clicking the Misc. charges button in the Disposition code form.

Returns and Intercompany

Returns in Microsoft Dynamics AX 2009 also supports intercompany direct returns.

In an intercompany setup, a user can have one company engaging directly with the end customer, and the sister company or subsidiary in the intercompany chain receiving the actual Return order.

The created intercompany order chain resembles a standard direct delivery order, where the actual processing of the chain takes advantage of the Returns feature.

CAUTION: When you create intercompany Return orders, the default behavior is for the system to assign the same (RMA) number to the intercompany Return order as was assigned to the original Return order. This implies a risk for a conflict if the RMA number is already being used in the intercompany company (// “Company B”). To avoid this situation, the number sequence for Return order numbers must be set up according to the following rule: If two or more companies participate in an intercompany relationship with one another, they must set up different number series for Return orders, for example: In Company A: “RMA_A_#####” In Company B: “RMA_B_#####” Then, automatic assignment and synchronization of Return order numbers will work.



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Create a Return Order The Return order is much like a Sales order and is therefore also characterized by a status that indicates what has been processed on the Return order. On the Return order, there is a header status field, as shown in the following table.

Status Description Created Upon creation, the header status will be Created. This indicates

that this is a planned Return order. The status on a Return order line is Awaiting. The order can be deleted or canceled, and a user can create new lines on a Return order with a status of Created.

Open When the first item starts to arrive in inventory, the status of the Return order is changed to Open. The status on a Return order line can be either Awaiting, Registered, Received, Quarantine, or Invoiced. A user can create new lines on a Return order with status Open.

Invoiced When a Return order has been fully credited (all lines are invoice updated) the status will change to Invoiced, and the order cannot be opened again for additional processing The status on a Return order line is Invoiced. A user cannot create new lines on a Return order with a status of Invoiced.

Canceled If the customer forgets to return an item, or if items never appear within a given time frame, a Return order can be canceled. The status on a Return order line is Canceled. A user cannot create new lines on a Return order with the status of Canceled.



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Return Order Form - Upper Pane

In the advanced view in the Return orders form, the order headers are in the upper pane and the lines for the Return order in the lower pane.

FIGURE 10.3 RETURN ORDERS FORM

The following options are available in the Upper pane:

• From the Setup button, miscellaneous charges can be set up for the Return order header

• From the Functions button, a user can perform the tasks shown in the following table

Function Description Find Sales order Create a Return order by retrieving the

information from the original Sales order, and the Sales order lines. A Return order is not required to be matched against a Sales order.

Cancel Return order Cancel the Return order.



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Function Description Send acknowledgement Send an acknowledgement document to the

customer to confirm that the returned items have arrived at the warehouse.

Send Return order Send the Return order document to the customer.

Create replacement order Create an up-front replacement order for the items to be returned. This function lets you send replacement items to the customer before the defective items are returned. This helps when a customer, for example, must have the spare parts available before he or she can dismantle the defective item. The up-front replacement order is an alternative to the replacement order created as from applying a disposition code when the returned item has been inspected.

Packing slip Packing slip update the Return order.

Return Order Form - Lower Pane

In the Lower pane of the Return order form, the following options are available:

• From the Setup button, miscellaneous charges can be created for each line

• From the Functions button, a user can find a replacement item if the disposition code specifies replacement

Return Order Form - Line Status

The lines in the Return order form can have the statuses shown in the table.

Line status Description Awaiting On a created or open Return order, this status indicates that

nothing has happened to the Return order line.

Registered This status indicates that items have been posted in the item arrival journal, either upon item arrival, or when it is returned from quarantine.

Received This status indicates that items have been packing slip updated and received in inventory.

Quarantine This status indicates that items are currently in quarantine.

Invoiced This status indicates that the Return order line has been invoice credited.

Canceled This status indicates that the Return order line has been canceled.



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Procedure: Create a Return Order

To create a Return order, follow these steps.

1. Open the Return orders form from Accounts receivable > Return Order Details.

2. Click the New icon, or press CTRL+N, and then select a customer account in the Customer account field.

3. Specify a customer contact person and a reason code for returning the items, and then click OK.

4. Click Functions, Find sales order to open the Find sales order form, and then select the Mark check box on the line to be returned and update the Quantity to return field, if necessary.

Or, if you do not want to associate the Return order with a sale order, you can select an item number in the Lines tab of the Return order form.

NOTE: The system prevents you from registering a customer return that is greater than the quantity that was sold to the customer, if the Return order is matched against the Sales order.

Microsoft Dynamics AX 2009 automatically fills in a return warehouse and expected deadline for returning the items. The deadline is calculated based on the setup of the Days of validity parameter found in the Accounts receivable parameters form, on the General tab.

The status of the Return order is Created, and because the items have not arrived at inventory, there will be no inventory transactions for the Return order yet. However, there is a parameter named Allow reservation on the General tab of the Return order form that enables you to trigger the immediate generation of inventory transactions, in cases where returned goods are known to be in perfect condition.

BEST PRACTICE: Although only one warehouse and one delivery address can be selected on the Return order header, you can assign each return item line to a different warehouse (and address). If the customer sends the returned goods to the warehouse address quoted on the header, the receiving warehouse will not see all lines in the Arrival overview form if that location is filtering to view returns assigned to its warehouse only. To avoid this, assign all return lines to the same warehouse that is specified in the header. If you cannot do that because some items are set up with a mandatory sales warehouse, then create a separate Return order for each item and assign it to the appropriate warehouse in the Return order header.



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Lab 10.1 - Create a Return Order Contoso Entertainment Systems - Company CEU

Scenario

You are a sales person at Contoso Entertainment Systems, and the customer Owl Wholesales calls to inform you that the three pieces of item number 1201 that they purchased from you on Sales order SO_100093 are defect.

One of Owl Wholesales’ sales persons will be visiting your warehouse today, so you create a Return order and give the customer an RMA number that they must use when they deliver the defective items.

Challenge Yourself!

1. Create the Return order for customer with the details in the following table.

Field Content Customer account 1202

Contact Jacky Chen

Return reason code group Defect

Return reason code 21

Deadline Today

2. Use the Find sales order feature to find the sales order line that is being returned by the customer; SO_100093

3. Print the Return order and note the RMA number.

Need a Little Help?

• Open Accounts receivable > Return Order Details to open the Return order form.

• To find the sales order, click Functions > Find sales order in the Return order form.

Step by Step

1. Open the Return orders form from Accounts receivable > Return Order Details.

2. Click the New icon, or press CTRL+N, and then select a customer account 1202 in the Customer account field.



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3. Select the customer contact person in the Contact field. 4. In the Deadline field, select today's date. 5. Click the Return reason code field, and select the Return reason

code group “Defect”, and then the Return reason code “21” 6. Click OK to create the Return order header. 7. Click Functions, Find sales order to open the Find sales order

form. 8. Select SO_100093 in the Sales order field. 9. Select the Mark check box on the line where Item number = 1201,

and Quantity = 3. 10. Click OK. 11. Click Functions > Send return order to print the Return order. 12. Notice the RMA number.



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Item Arrival and Receipt Registration You can use the Item arrival journal to register the receipt of items from customers. You can create an item arrival journal manually, or by using the Arrival overview form.

FIGURE 10.4 ARRIVAL OVERVIEW FORM - RETURN ORDER VIEW

When the status of the Return order in the Arrival overview form is Completed, it means that journals have been created and are ready to be registered.

Item registration is performed from the Item arrival journal, which is accessed from Inventory management > Journals > Item arrival > Item arrival.

On the journal lines, the user can select to:

• Send the returned items to quarantine • Apply a disposition code • Split an arrival registration

The disposition code applies to all the items on a journal line. If you want to dispose of some items differently, then you must split the line. Splitting the journal line will also split the corresponding Return order line.



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The journal can be posted when all lines either have a disposition code applied or are sent to quarantine. When the journal has been posted, the returned items not sent to quarantine will be registered in inventory.

Post Packing Slip

To receive the returned items into inventory, the order must be packing slip updated. Sammy, who is responsible for shipping and receiving, can perform this from the Arrival journal or Susan, the order processor, can perform this from the Return order form.

As part of the packing slip posting, the packing slip reference number from the customer's shipping documents will be associated with the order lines.

If not all expected return items have arrived, only the quantity that has actually arrived will be included in the packing slip updating and a new return line will be created for the remaining quantity. The rest will wait for the next return shipment order to arrive.

When you packing slip update the Return order, the system creates replacement orders according to the disposition code settings on the lines.

Post Invoice

Because a Return order is basically a Sales order of type Returned order, the usual Sales order invoicing process is applied and used.

You can only invoice-update the Return order and create the credit note from the Sales order form or from Accounts Receivable > Periodic > Sales update > Invoice. It is not possible to invoice update a Return order from the Return order form.

Scenario: Initiate the Arrival of a Return Order Arrival

Sammy, who is responsible for shipping and receiving, has created a special view in the Arrival overview form only for customer returns. Because customer returns typically represent a small percentage of the actual arrivals, it is usually easier for Sammy to locate a return and confirm its arrival.

The customer may never decide to return the item(s). In these cases Lisa, in customer service, cancels the authorized Return order.

If returned items arrive at the warehouse, Sammy will start to search for them by trying to match the RMA number on the attached shipping documents to the RMA number in his item arrival overview.

When the RMA number is located, Sammy will start the arrival process.



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When the arrival process is started from the Arrival overview form, the system will automatically create a journal that contains the necessary data to start the registering process. The item arrival journal will be prefilled with the required reference information, such as customer ID, lot number, return quantity expected, and more.

When the arrival process starts, the system creates inventory transactions for the returned items.

Sammy can then select between two methods to register the arrival of returned items:

• Create an arrival journal from the Arrival overview form • Create an item arrival journal manually

Scenario: Determine the Disposition of a Return Order on Arrival

Sammy checks the returned items that have arrived. He counts the quantity and verifies the state of the returned items. If the returned items must have an additional inspection, Sammy specifies that the journal line should go to quarantine and posts the journal.

If the items are sent for inspection in the quarantine warehouse, a Quarantine order will be created by the system. This will be processed by Ricardo, the quality controller, who inspects the items and applies a disposition code.

NOTE: If the returned item belongs to an Inventory model group that has the Quarantine management parameter enabled, the returned item must go through quarantine.

If the returned items are determined undamaged, Sammy may select to add them to inventory. Sammy specifies a disposition code and a warehouse where they can be returned to, and posts the arrival journal.

Procedure: Process the Arrival of a Return Order Arrival from the Arrival Overview Form

To process the arrival of a Return order, follow these steps:

1. Open the Arrival Overview form from Inventory management > Periodic > Arrival overview.

2. To view Return orders, select the option Return order in the Setup name field on the Overview tab.



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a. This filters on Return orders only, and Return orders with outstanding arrivals are now displayed in the Receipts pane on the Overview tab.

b. In the Range field group in the Arrival overview form, a user can search for a specific Return order by, for example, entering the RMA number or the item number.

3. When the correct Return order has been located, select the Select for

arrival check box for header and lines as appropriate, and then click the Start arrival button. When you click the Start arrival button, Microsoft Dynamics AX 2009 automatically creates a new journal header and journal lines that correspond to the lines selected in the Arrival overview form.

4. Click Journals > Show arrivals from receipts, and then click Lines.

5. Select a Disposition code on the General tab, and then click Post to post the journal.

6. Close all forms.

You can also select multiple Return orders when an arrival is started. Each Return order line is copied to an item arrival journal line.

Procedure: Post the Packing Slip

After the arrival of the Return order has been processed, you can post the packing slip. To do this, follow these steps:

1. Open Accounts receivable > Return Order Details. 2. Select the Return order that you want to packing slip update. 3. Click Functions > Packing slip. 4. Click OK.

You can also post the packing slip from the Arrival overview form, by clicking Journals > Packing slip ready journals.

Procedure: Post the Invoice

To invoice the Return order, follow these steps:

1. Open Accounts receivable > Sales Order Details. 2. Locate the Sales order of the Returned order type, that has been

automatically created from the Return order. 3. Click Post > Invoice and post in the same manner as a Sales order.



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Receipt in Progress

The Receipt in progress field indicates the progress of the Return order. A Return order can have the following three statuses as shown in the table.

Status Description None None of the lines in the receipt are registered in an arrival

journal.

Partly At least one of the lines in the receipt is registered in an arrival journal.

Complete All the lines in the receipt are registered in an arrival journal.



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Lab 10.2 - Process a Return Order Contoso Entertainment Systems - Company CEU

Scenario

You are the warehouse worker at Contoso Entertainment Systems, and you have received the returned items from the customer Owl Wholesales, with the RMA number that you created in the Lab - Create a Return Order.

You determine that the items are defective and start the arrival of the Return order. You post the Arrival journal with a disposition code to reflect that the items will be repaired and that customer will be credited.

Challenge Yourself!

1. Start the arrival of the Return order. 2. Apply a disposition code to the journal that reflects that you will

credit the customer, and when the items are repaired, they will return to inventory.

3. Post the journal.

Need a Little Help?

1. Use the Arrival overview form in Inventory management > Periodic to start the return item arrival.

2. Remember to filter for Return orders. 3. Use Journals > Show arrivals from receipts to open the Journals

form.

Step by Step

1. Open the Arrival Overview form from Inventory management > Periodic > Arrival overview.

2. Select Return order in the Setup name field on the Overview tab. 3. Click the Select for arrival check box on the Return order that you

created in Lab - Create a Return Order. 4. Click the Start arrival button. Microsoft Dynamics AX 2009

automatically creates a new journal header and journal lines that correspond to the lines selected in the Arrival overview form.

5. Close the infolog. 6. Click Journals > Show arrivals from receipts, and then click

Lines. 7. Select 12 in the Disposition code field on the General tab



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8. Click Post and then click OK in the next window. 9. Close the forms.



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Lab 10.3 - Post the Packing Slip and Invoice Contoso Entertainment Systems - Company CEU

Scenario

You are a sales person at Contoso Entertainment Systems, and you have been informed by the warehouse worker that the Return order that you created in Lab - Create a Return order has been delivered by the customer.

Challenge Yourself!

Post the packing slip and invoice the customer, to create a credit note for the returned items.

Need a Little Help?

1. Open the Return order in Accounts receivable > Return Order Details.

2. Use the Functions button to open the post the packing slip. 3. The Return order is invoiced from the Sales order form.

Step by Step

1. Open Accounts receivable > Return Order Details. 2. Select the Return order that you created in Lab - Create a Return

Order. 3. Click Functions > Packing slip. 4. Click OK, and close the Return orders form. 5. Open Accounts receivable > Sales Order Details. 6. Locate the Sales order of the Returned order type, that has been

automatically created from the Return order. 7. Click Post > Invoice and post in the same manner as a Sales order.



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Quarantine Orders By enabling Sammy, who is responsible for shipping and receiving, to indicate on a returned item that it must visit inspection, Sammy will not have to make any decisions on the disposition of the item, but leave it up to Ricardo, the quality controller, to decide.

When Sammy has specified that the item must go in quarantine and posted the item arrival, Ricardo will automatically have a Quarantine order for the returned item. Ricardo must then update the Quarantine order with his decision on the disposition of the item, and the system will update the Return order accordingly.

The following scenarios describe how to cover the overall Quarantine order process for Return orders.

Scenario: Pass Returned Items on to Inspection

Sammy is looking at the items that have arrived and finds the returned items. He evaluates the returned items by looking at the packaging and the overall condition, and if the returned items are in an acceptable condition, he can return them to inventory. Sammy will specify a disposition code and post the item arrival.

If the returned items are in a poor condition and require more investigation, Sammy will indicate in the system that the returned items must be sent to inspection for additional processing. He selects the Quarantine management check box and posts the arrival journal.

The company may also have a policy that all returned items should go to quarantine.

Scenario: Create a Quarantine Order Automatically

When Sammy, who is responsible for shipping and receiving, has selected the Quarantine management check box for the returned items and posted the arrival journal, the system will automatically create a Quarantine order for the returned items.

A Quarantine order can only be associated with a single item number. Therefore, if Sammy selects to send ten different returned items to quarantine, ten individual Quarantine orders will be created for Ricardo, the quality controller, to process.

Scenario: Apply a Disposition Code to a Quarantine Order

Ricardo, the quality controller, inspects the returned item(s) and decides how to dispose of them. If it is required, he will split the Quarantine order to apply different disposition codes to the returned items.



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Scenario: Report as Finished/End a Quarantine Order

Depending on the setup of the Warehouse management, Ricardo, the quality controller, performs one of the following tasks:

• Reports the Quarantine order as finished, that is, he releases the returned item(s) and creates an item arrival journal entry. Sammy later processes the journal and returns the items to inventory. Sammy cannot change the disposition code that Ricardo has updated.

• Ends the Quarantine order by moving the inspected items directly back into inventory.

Scenario: Dispose of the Returned Items

When the items have been returned from quarantine with a disposition code, the later packing slip updating and / or invoice updating of the Return order will implement the actual scrapping, crediting, or returning actions specified by the disposition code.

Replacement Orders If your customer returns an item that is defective or incorrect, you can create a Replacement order to use to send the new items to the customer.

Replacement orders are usually created after a product is returned and inspected. However, when an item must be replaced before it has been returned, or when the original item will not be returned, you can create a Replacement order immediately after you create a Return order.

Procedure: Create a Replacement Order

To create a replacement order, follow these steps.

1. Click Accounts receivable > Return Order Details to open the Return orders form.

2. On the Overview tab, select the appropriate return order. 3. Click the Functions button and then click Create replacement

order to open a Create sales order form. 4. Select the Copy return order lines check box to transfer details

from the Return order you selected on the Return orders form to this Sales order.

5. Enter or modify details as necessary. 6. Click OK to close the Create sales order form, and then open the

Sales order form to continuing working on this order. Notice that the RMA number is copied to the Sales order, on the References tab.



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Reports and Statistics The purpose of the return reports and statistics is to provide a company with an overview of how the return processes are working, what the volume of the Return orders is and how it affects the business.

The reports and statistics within returns can be used for several purposes, for example:

• To determine the volume of returns for a given period and how it is distributed over items and customers

• To measure the time that is spent on handling customer returns • To judge if the return process is well managed or uncontrolled

The following reports are available from Accounts receivable > Reports > Return orders:

• Return volume • Return statistics ranking • Return cycle time

Return Volume

Use the Return volume report to prepare a report about the volume of returns for each item or customer and the time that you spend on handling customer returns. You can print in general or batch mode.

You can find the Return volume report in Accounts receivable > Reports > Return orders > Return volume.

Scenario: Determine the Volume of Returns for a Given Period

Vince, the operations manager, wants to obtain a quick overview of what the level of returns is for the last fiscal quarter. He runs the Return volume report grouped by month and return reason codes.

Scenario: Investigate the Nature of Customer Returns

Ricardo, the quality controller, is preparing his input to the monthly operations managers meeting. He prints a report that displays the returns for the last twelve months, grouped by return reason code.

Return Cycle Time

Use the Return cycle time report to prepare a report about the time that is required to handle return issues. This can be calculated as the internal time cycle, external time cycle, or full-time cycle.



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You can find the Return cycle time report in Accounts receivable > Reports > Return orders > Return cycle time.

Scenario: Determine the Return Cycle Time

Kevin, the sales manager, has had customer complaints that the company takes too long to handle returns. He examines the Return cycle time report that displays the average, maximum, and minimum return cycle times for the various return reason codes over the last year.

Scenario: Estimate Capacity Requirements for Return Items

Ellen, the warehouse manager, wants to investigate if their current inventory return locations are too spacious or insufficient. She examines the Return cycle time report that displays the number of returns and return cycle times for the last six months.

Return Statistics Ranking

Use the Return statistics ranking report to prepare a report about the volume of returns for a given period and how they are distributed over items and customers.

You can find the Return statistics ranking report in Accounts receivable > Reports > Return orders > Return statistics ranking.

Scenario: Determine High Return Volumes Customers

Kevin, the sales manager, wants to determine those customers who have an unusually high percentage of returns. He examines the Return statistics ranking report that displays the top ten customers who have the most returns.

Scenario: Determine the Volume of Returns for Individual Items

Tony, the production manager, wants to see whether he can discover any patterns in the return items that might indicate that the production is unstable. He examines the Return statistics ranking report that displays the top ten returned products for the last six months.



10-27

Summary Customer Returns discussed how to set up and use the returns functionality in Microsoft Dynamics AX 2009. Return management helps a company to systemize customer returns and improve the efficiency of customer service and customer satisfaction.

Additionally, you can print various reports to provide an overview of the following:

• The volume of returns for each item or customer • The time that is spent on handling customer returns • How well the return process is managed



10-28

Test Your Knowledge Test your knowledge with the following questions.

1. As part of the item arrival and inspection, a Disposition action will be assigned to returned goods to specify how to dispose of the return goodsm, how to handle the return financially, and if a replacement item must be sent to the customer. What happens with the predefined Disposition action "Credit"?

( ) Scrap item, create replacement order, credit customer ( ) Put item back into inventory, credit customer ( ) Do not return item, only credit customer, or customer scraps item, credit

customer ( ) Put item back item into inventory, create replacement order, credit

customer

2. When a Return order line is created, or open and nothing has happened to it yet, what is the status of that line?

( ) Canceled ( ) Awaiting ( ) Open ( ) Created

3. What is the name of the form where you perform the invoice of the Return order?

( ) Return order form ( ) Arrival overview form ( ) Sales order form ( ) Location journal form



10-29

Quick Interaction: Lessons Learned Take a moment and write down three key points you have learned from this chapter:

1.

2.

3.



10-30

Solutions Test Your Knowledge

1. As part of the item arrival and inspection, a Disposition action will be assigned to returned goods to specify how to dispose of the return goodsm, how to handle the return financially, and if a replacement item must be sent to the customer. What happens with the predefined Disposition action "Credit"?

( ) Scrap item, create replacement order, credit customer (•) Put item back into inventory, credit customer ( ) Do not return item, only credit customer, or customer scraps item, credit

customer ( ) Put item back item into inventory, create replacement order, credit

customer

2. When a Return order line is created, or open and nothing has happened to it yet, what is the status of that line?

( ) Canceled (•) Awaiting ( ) Open ( ) Created

3. What is the name of the form where you perform the invoice of the Return order?

( ) Return order form ( ) Arrival overview form (•) Sales order form ( ) Location journal form


AX2009_ENUS_TL1_10

Documents

credit customer

customer returnsnote

handling customer

return order form

return process

return warehouse

return order handle

customer returns chapter