This article specifies the returns in the sales process. It will explain why returns are quite interesting in the sales, how you can look for returns and which follow-up analysis can be done.
Categorization of Returns
Returns can appear due to the following reasons:
Wrong goods were delivered.
The material was damaged.
The delivery quantity was too high.
Normally, the returns process has the following steps:
The goods are sent back by the customer.
A returns order is created. Normally, the original sales order is taken as reference.
A returns delivery document is created.
The goods receipt is posted.
A credit memo is posted.
Identification of returns
Returns are identified by means of the sales document category “H” which is stored in table VBAK. Only processes with a physical returns delivery are considered; credit memos without a delivery are not described.
In the following chapter, a returns order in table VBAK is identified for instance. The corresponding process is described in detail. In transaction SE16, you can filter the field VBTYP (sales document category) to the value “H”:
In the next screen you get a list of the filtered sales documents.
Let’s look at the returns order 0060000018. We go to transaction VA03 and fill in the document number in the selection screen. Then you get the following screen:
You see in this example that customer 51 sent back 10 bicycle trousers due to bad quality. The net value of the returns order amounts 310 Euro. The user wants to get more information about the whole process now. Possible questions are:
How many bicycle trousers were delivered in the concerned sales order?
Was the sales order billed?
Has the customer received a credit memo about the returned goods?
The process flow can be displayed by clicking the Icon “Process Flow” top left:
A sales order with the document number 177 was created which includes 100 bicycle trousers with a total amount of 3100 Euro. A returns order with a value of 310 Euro bases on this sales order. However, this process flow does not show the complete process because we do not see if further subsequent documents also base on the sales order. We should include all follow-up processes of the sales order. If we mark the line which includes the sales order and click the button “Show document”, we get the document display:
If we click the Icon “Display document flow” top left, we get the following process overview:
We see in this overview that the sales order was already completely delivered and billed before the returns delivery happened. This should correspond to the standard process.
If there are deviations from this process, the reasons can be questioned. Is this the defined process in the company? Is there a process weakness? For instance, the process could begin with a returns order which has no reference to a different document.
Very important are aggregations on customer level, for instance, customers can be identified which have the highest returns rate compared to the order volume. This can be done very fast by totaling the net value per sales document category “C” (order) and customer and comparing with the sum per sales document category “H” (returns) and customer.
Another aspect is the accumulation of returns at the beginning of the year. A possible reason could be that the sales representative makes a high turnover at the year end to reach the objectives.
The article has shown that returns can be a critical process in a company which should be analyzed. Thereby, the process flow should be proved to see the reason for the returns. On the other hand, aggregations on customer level have a high priority.
Be the first who comments this blog entry.
You are not logged in. Please log in to comment this blog entry.