Inspect and add expenses to a return

Inspect and add expenses to a return

Returns actions such as shipping to/from the customer, inspection, repair, and write-off incur costs. When a return order is authorized and Inspect is selected as the receipt action, Cin7 Core creates a job to accumulate this expenditure. Adding costs and expenses to a product return is not allowed when the receipt action is Scrap or Restock.

Once the return is resolved, the expenditure is then either:

  • Invoiced to the customer

  • Written off to an expense account if the merchant bears the cost.

Expenses added to the return are linked to job milestones that are pre-configured for the return policy (see RMA processing milestones) such as return shipment, repair, inspection, etc.

The created job is also accessible from Production → Jobs. All job actions taken and expenses added within the return order are reflected in the job.

The job is created for the customer connected to the RMA and return order, i.e. any job fields referring to the customer are filled automatically with the RMA customer's details.

Prerequisites

Add costs from a purchase

Purchased costs can be for products or services, such as replacement parts, shipping costs, repair and cleaning costs. In our example company, the customer pays for shipping the return back to the company. We can input this like so:

  1. On the Inspection/repair costs tab, click + New expense → Purchase.  

  2. Select the milestone for the expense, in our case,Shipping from customer. This creates a new purchase in draft status.

  3. The purchase details show that the costs will be allocated to the correct job account and milestone.  

  4. Here we can select our shipping supplier, add the shipping service cost details, and Authorize the purchase order. Purchase invoice and stock received (if applicable) can then be carried out as usual (see Processing a purchase for detailed information).  

  5. Once the purchase is completed, the expense will be shown for that milestone on the return order with a link to the expense task.

      

Add costs due to internal labor or inventory

Internal labor costs, or use of internal stock, can also incur costs for a return. These are assigned to a return using the inventory write-off feature. Our example company incurs a cost for labor for inspection, which is not charged to the customer.

  1. On the Inspection/repair costs tab, click + New expense → Inventory write-off/cost of labor..   

  2. Select the milestone for the expense - in our case,Inspection. This creates a new inventory write-off task in draft status.

  3. The inventory write-off details show that the costs will be allocated to the correct job account and milestone.  

  4. Here we can add our labor costs to the inventory write-off and specify a credit account. Complete the write-off to continue.  

  5. Once the write-off is completed, the expense will be shown for that milestone on the return order with a link to the expense task.

Add costs from an assembly

Return costs can also come from assemblies.

  1. On the Inspection/repair costs tab, click + New expense → Assembly. 

  2. Select Inspection as the milestone. This creates a new assembly task in draft status.

  3. The assembly details show that the costs will be allocated to the correct job account and milestone.  

  4. Here we can select the assembly SKU and make any chances to the BOM components and overhead costs.

  5. Once the assembly is completed, the expense will be shown for that milestone on the return order with a link to the expense task.

Return order resolution

After expenses have been added to the return order milestones, the user can resolve the return order. The resolution will be passed to the RMA where it can then be communicated to the customer. Resolving the return order marks the open job as Completed and means the return order can not be edited.

Select the Resolution tab to continue and select an option from the dropdown menu. Available options are scrap (defective), scrap (damaged), restock, and return to customer. Product receipt with the Inspect action allows for more resolution options than Scrap or Restock, for example, restocking an item to an alternative SKU.


     

Scrap damaged or defective products

Scrapped products are written off from your inventory. Defective indicates the product is written off due to a production defect, while Damaged indicates the product is written off due to damage after the sale. Cin7 Core generates an inventory write-off task to reflect this.

Write-off Location, Expense account and Effective date can be edited. Quantity, Cost, and Total Cost are fixed. Costs are auto-filled with the product's cost of goods at sale.

Pressing Resolve button executes the write-off. The status of the product is changed to Resolved and the job status is changed to Completed.


     

Restock products

Restocked products are returned to your inventory. Products can be restocked as the original SKU, or as a different SKU (e.g. refurbished electronics). Cin7 Core generates a stock adjustment task to reflect the restock.

The costing method of the original SKU and restocked SKU must match. E.g. If NewPhone has costing method FIFO serial and it is restocked to RepairedPhone, RepairedPhone costing method must be FIFO serial.

In Location, select where the product will be restocked. Use the Restock as dropdown menu to select which SKU the product should be restocked as. Restock Date and Comment can be edited. Status refers to the status of the stock adjustment task.

Pressing Resolve button finishes the restock job. The status of the product is changed to Resolved and the job status is changed to Completed.
     

Return products to customer

The products will be returned to the customer, no further tasks or actions are taken from the return order. Pressing Resolve button passes the resolution to the RMA. The next actions are taken by the RMA manager when resolving the RMA.

Next steps

Once all costs and expenses related to the return have been completed and you have resolved your job and return order, the next step is to reach your RMA resolution and communicate it to the customer.

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