When a customer returns an item, it is tracked in a return authorization.
Each return authorization records data regarding the Customer Returns Process, such as item numbers and prices, as well as procedural information such as the status of each return. This process can include issuing and approving the return authorization, receiving items back into inventory, issuing a credit or refund to the customer, and closing out lines on an authorization.
Each department uses the return authorization to handle returns. The receiving department matches return authorizations to items as they receive shipments. The authorization shows the accounting department, the credit or refund amount due to each customer, and whether the credit or refund has been processed. Management can use return authorizations for Reporting on Customer Returns Impact on the company.
As the return authorization form is updated at each point in the process, accurate and efficient returns data is maintained for all departments. This is necessary because your sales, inventory, and accounting functions are integrated. For example:
- When a return is initiated from the original sale, the process is simplified, time is saved and keying errors decrease because you do not re-enter information. The information from the sale is copied to the return, such as the sale price and quantity sold.
- When the warehouse receives an item against an authorization, totals for stock levels and inventory values are simultaneously updated without entering additional forms.
- Depending on your set preferences, a credit memo is not issued by accounting until the item is received in the warehouse, which safeguards against losses due to crediting unreceived returns.
With an integrated system, all employees use one set of data to manage, process and track returns with current, accurate information in real time.