SAP SD Return Order Process

Advertisement

SAP SD Return Order ProcessWelcome to the tutorial about SAP SD Return Order Process. Learn how returns processing is managed in SAP SD. This tutorial is part of the free SAP SD course.

To understand the requirements for SAP SD return order process, let’s consider some questions. What if a product that has been sent to the customer’s premise does not meet the specifications or grade that has been promised? And, what if the customer decided they want to return the product? Or what if the fault is from your company’s side? What will the company do to handle the situation?

Advertisement

SAP ERP offers standard procedures for returns processing, either sending a new product for replacement or reducing the bill with credit memo processing. In this document, I am going to explain each process along with the steps and screenshots to make your understanding better.

SAP SD Return Order Process Flow

SAP SD Sales Return Processing
SAP SD Sales Return Processing

This process assumes that you have a billing document from the previous process that will be referenced for the upcoming return process.

SAP SD Return Order Process with Credit Memo

You need to create SAP SD Return Order document. Run the transaction VA01, select the sales document type (Sales Order Return), and enter the necessary sales area.

Create SAP SD Return Sales Order
Create SAP SD Return Sales Order

Press “Enter” button. You should look up your client’s business process to check whether a previous document has to be referenced or a return order can be created independently. For this example, I made it mandatory to enter the previous generated billing document, so a new pop up will show up.

  1. Fill the field with the billing document.
  2. Click “Copy” or press “Enter” button.
Input Billing Document as a Reference
Input Billing Document as a Reference

The copy control procedure will do magic by copying all of the information from the billing document (partner function information, quantity, price, etc.).

Create SAP SD Return Sales Order - Overview Screen
Create SAP SD Return Sales Order – Overview Screen

There are two important things that we need to look up to. First, you need to fill in the order reason. Second one is the quantity that the customer returns to our premises.

Select Order Reason and Change Quantity to the Actual Quantity
Select Order Reason and Change Quantity to the Actual Quantity

Now, you have already completed all the necessary information to create a credit memo request document. Just to make sure that nothing is missing run the incompletion log.

Run the Incompletion Log and Look Out the Bottom Left Message
Run the Incompletion Log and Look Out the Bottom Left Message

Make sure the message is as shown above, “Document is complete”. It means that no things left behind. Click on the save button .

SAP SD Return Order is Created
SAP SD Return Order is Created

After the SAP SD return order is created, the logistic department will be normally informed by the marketing admin personnel that there will be a returned item from the customer. The logistic staff will be advised to create a return delivery.

Advertisement

Run the transaction VL01N, enter a shipping point and order document number.

1. Enter the Shipping Point 2. Enter the SAP SD Return Order Number
1. Enter the Shipping Point 2. Enter the SAP SD Return Order Number

In the next screen, you have to determine which storage location is going to be used (usually the return storage location). And also, if you’ve activated batch determination, you will need to insert the batch number as well.

Determine Storage Location and Enter Batch Number (If Applicable)
Determine Storage Location and Enter Batch Number (If Applicable)

Next, click on the “Post Goods Receipt” button.

Post Goods Receipt Button
Post Goods Receipt Button

Your new return delivery will now be created and a goods movement posted.

Now, let’s have a look at the accounting entries that were created. Clearly, this is the opposite of a normal goods issue. This process will put the COGS (Cost of Goods Sold) account in credit while the warehouse stock is increased.

Accounting Entries for Posting Goods Receipt
Accounting Entries for Posting Goods Receipt

Let’s also check the impact of our posting on the stock levels. Run the transaction MMBE to check the stock in our return storage location.

MMBE - Enter the Material and Plant
MMBE – Enter the Material and Plant
Returned Material
Returned Material

That newly added stock will be reviewed by the warehouse staff to decide what action should be taken on it.

Advertisement

Now, after we received the returned material, the accounting will be informed that they should create a credit memo to reduce the sales for the certain customer.

Run the transaction VF01 to create the credit memo.

Transaction VF01 – Initial Screen
Transaction VF01 – Initial Screen

Enter the delivery document number and click “Enter”. If you leave “Billing Type” blank, the system will automatically select the billing type that has been defined for that delivery document. It will also propose the billing date based on the receiving date.

Credit Return Document – Overview Screen
Credit Return Document – Overview Screen

You can now save the document . Next, let’s look at the generated accounting document. It clearly states that the customer will be credited with 115.000 IDR.

Accounting Entries for Return Credit Memo
Accounting Entries for Return Credit Memo

SAP SD Return Order Process with Replacement

Now, let’s discuss a follow-up scenario for SAP SD return order process. This scenario occurs when the customer demands a replacement for the consequence that our company delivered a wrong or faulty item.

Advertisement

After we created the credit memo for the customer, we also have to create a replacement sales order to ship the replacement item to the customer.

Create Sales for Replacement
Create Sales for Replacement

If you configure the system that specification of a reference document is mandatory, then you will need to enter the document number (in my case is the return sales order we created earlier). Next, click “Copy” button.

First Enter the Return Sales Order Number, Then Click Copy
First Enter the Return Sales Order Number, Then Click Copy

As you can see, the screen looks just like a regular sales order creation. Now, check the pricing conditions for the returned item.

Highlight the Line Item, Then Click Conditions Icon
Highlight the Line Item, Then Click Conditions Icon

You will not find the base price because we are not selling the replacement item.

Conditions Tab for Sales Replacement
Conditions Tab for Sales Replacement

Run the incompletion log to make sure that you didn’t forget anything. Then, click “Save” to get the document number.

Sales Replacement Order is Created
Sales Replacement Order is Created

Now, run the transaction VL01N for the logistics operations.

Create Outbound Delivery
Create Outbound Delivery

Enter a storage location and a batch number. Then, click on the “Post Goods Issue” button.

Enter Storage Location, Batch (If Applicable), and Post
Enter Storage Location, Batch (If Applicable), and Post

The new document will be created. Also, let’s the document flow that captured the SAP SD return order process we have just run. You can see the chain of document.

SAP SD Document Flow
SAP SD Document Flow

Common Questions with SAP SD Return Order Process

Q-1: Is it possible to create a credit memo after you finished the return order document?

A-1: Yes, it is possible. You just need to make the configuration for the copy control from a sales document to a billing document.

Q-2: The returned material should be inspected by the quality assurance team. How to achieve that?

A-2: There are two ways:

  • First, you can change the movement type during posting goods receipt, so it will be a blocked stock instead of an unrestricted use stock.
  • Or, you can do the transfer posting transaction by using different movement type in MIGO transaction.

Did you like this tutorial? Have any questions or comments? We would love to hear your feedback in the comments section below. It’d be a big help for us, and hopefully it’s something we can address for you in improvement of our free SAP SD tutorials.

Navigation Links

Go to next lesson: SAP Invoice Correction Request

Go to previous lesson: SAP SD Debit Memo Processing

Go to overview of the course: SAP SD Training

3 thoughts on “SAP SD Return Order Process”

Leave a Reply

Do you have a question and want it to be answered ASAP? Post it on our FORUM here --> SAP FORUM!

Your email address will not be published. Required fields are marked *