Returning Outbound Inventory

When you ship consigned or vendor managed inventory to your customer's location, some inventory can get damaged or expired. When the customer wants to return damaged, expired or unused outbound inventory, they do so by creating a credit order. The credit order issues necessary credits to the supplier and makes adjustments for the returned outbound inventory.

You use the Sales Order Entry application to create credit orders to return outbound inventory. When you create a credit order to return outbound inventory, you must also associate the respective agreement information with it. Depending on the agreement type, and the processing option setup for the Sales Order Entry application (P4210), the system defaults the line type on the credit order.

When you create a credit order for an internally owned shipment order with a consigned inventory or internally owned VMI agreement attached to the order detail line, the system defaults the price on the order detail to zero, because an internally owned shipment order does not have any price attached to it.

You can enter the lot and serial numbers of the inventory that you return to the supplying location. After you confirm shipment of the credit order, the system updates the Outbound Inventory Item balance table (F42I021) and returns the inventory back to the supplying location. When the inventory is received at the supplying location, the system also increases the remaining quantity for the respective agreement.