Hardware return by customer

[fawadtung]

Dear Community,

We are having certain serialized inventory which is sold to Customer, in certain cases these items may be returned at a different value, but since we post the Return against a customer; the item is taken back into the same batch hence the pricing of the batch is applied to the item being returned, which in actual should be the buyback value of the item.

Example: Material 12345 is sold for $200. After a while the customer returns the item (terminates the relationship with the company and the customer is offered $90 for the same hardware.

As per current practice SO (for actual return), DC and Invoice is created but the system only allows the original batch to be entered from with OBD was created, resulting in the internal price of the batch copied to the returning material, messing up the cost of the item.

The item being returned should be valued at $90 not $200.

We can generate a new serial number at the time of the return but this way the item being returned will also be shown on the customer end and in our stock, this is not required under any circumstance

Kindly suggest how can this issue be fixed.

[former_member244427]

Hello,

The price in material master is what determines the value of the inventory and it is not affected by the sale process. COGS and inventory are updated as per the cost in material master.

Having said that, ideally if you are taking back a material under same material code and in case of split valuation in the same batch/valuation class means it should be valued at the same price as whats available in the system updated via cost estimation (assuming Standard cost estimate is used).

What can you do:

You can take it back in quality inspection stock (655 movement type) and do transfer posting to different valuation type with less value while posting UD.

Another way could be follow the current process and post MR21 and revalue the stock after posting returns.

Regards,

Abhishek

[VeselinaPeykova]

Would this affect VPRS in the order and billing?

I ask because in some companies they use VPRS to calculate further pricing conditions.

[fawadtung]

Dear abhishek.rai,Changing the price with MR21 would post an adjusting entry to a GL account as the valuation of a particular stock is being changed. Since we have the return process as a normal part of our business this would lead to huge amount at the end of the day.

[former_member244427]

Hello

Yes, and i think that was your aim, right? You said your current inventory is at 200, but you want to take it back at 90. So if you do that your current inventory will be 90 and 110 should be reduced from the inventory and transferred to a price difference account, MR21 does the same thing. Also as you are having split valuation you can post MR21 for the particular valuation type.

VPRS take the value from Material master.

Regards

Abhishek

[fawadtung]

Dear abhishek.raii,

Yes we want to take the material back with less cost but not at the cost of the company so we cannot post it to one GL, we want to apply some deduction (Depreciation) to the customer for using the hardware for particular time period that why we want to take it back at a reduced cost, not actually reducing the value of the entire batch but the particular stock item.

I hope I made myself clear else i will give a real life example to you.

[fawadtung]

Dear abhishek.rai,

What if i turn off the batch management check in the material master data will it solve the issue, as i have tried to take the material back into stock (MIGO) using the movement type 451 (Customer returns) but when posting the document; following error is given:

Batch for serial number 10000824 (1000) differs from document batch 123

Message no. IO229

Diagnosis

You have entered an incorrect batch or movement type.

The batch entered in the document or movement type does not correspond to the batch or movement type saved in the master record of the serial number.

System Response

The system cannot perform the function.

Procedure

Use another serial number or batch.

This means that the same batch number is to be entered inorder to post the document.

[former_member244427]

Hello,

Removing batch management is not easy. It will take a lot of effort. See OSS note 30656.

Also what would you achieve by that, in split valuation it again not allow to take it back in a different valuation class.

So again what is your objective?

If you want to change the batch in the serial number you can post transfer posting 309 enter the new batch as batch of the receiving material.

Regards

Abhishek

[fawadtung]

Dear abhishek.rai,

Thank you for detailed reply.

I am badly stuck, can you guide what should I do? As i have tried to the take it back from the customer using movement type 451 (return from the customer); it is important since we have to update the record that the customer has returned the hardware/ material; but the system gave the same error that the batch or valuation type cannot be different.