Customer Return Management Scenario Overview

1. Customer Return ManagementScenario Overview Click process chevrons for details Processing Inbound Deliveries Creating Customer Credit Memo Processing Receivables and Payments Processing Customer Return Processing Inbound Delivery Notifications Order-to-Cash (Sell-from-Stock) Order-to-Cash (withSpecifiedProducts) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Processing Inspections Scenario Explorer Scenario Description Open Legend Open Legend • The Customer Return Management business scenario enables you to process the inbound delivery of physical goods returned by a customer for a replacement, a credit for the returned goods or for repair. • There are also functions for: • Collaboration between warehouse and sales or customer serviceThe return processing includes late updates of inbound deliveries, as well as transferring notes and attachments from warehouse to the return documents. • Outbound delivery in case of returns received for repair at own service center. • Return confirmation to customerThe form-based confirmation to a customer in order to inform a customer about goods receipt, references, and contacts. • Creating and approval for credit memoThe creation of a credit memo and the option to introduce an approval process with thresholds. • PricingThe restocking and quality loss fee as pricing conditions help to level or refine the amount for compensation. Scenario/Processes Business Value Scenario Flow Further Information + The following business roles are involved in this scenario: Warehouse Operator Sales Representative Accounts Receivable Accountant Service Planner/ Dispatcher

2. Customer Return ManagementScenario Overview Click process chevrons for details Processing Inbound Deliveries Creating Customer Credit Memo Processing Receivables and Payments Processing Customer Return Processing Inbound Delivery Notifications Order-to-Cash (Sell-from-Stock) Order-to-Cash (withSpecifiedProducts) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Processing Inspections Scenario Explorer Scenario Description Open Legend Open Legend Open Legend Open Legend Open Legend Open Legend Legend Close Legend • The Customer Return Management business scenario enables you to process the inbound delivery of physical goods returned by a customer for a replacement, a credit for the returned goods or for repair. • There are also functions for: • Collaboration between warehouse and sales or customer serviceThe return processing includes late updates of inbound deliveries, as well as transferring notes and attachments from warehouse to the return documents. • Outbound delivery in case of returns received for repair at own service center. • Return confirmation to customerThe form-based confirmation to a customer in order to inform a customer about goods receipt, references, and contacts. • Creating and approval for credit memoThe creation of a credit memo and the option to introduce an approval process with thresholds. • PricingThe restocking and quality loss fee as pricing conditions help to level or refine the amount for compensation. Process mainly driven by the user Process mainly driven by the system Manual process not supported by the system Process that communicates with third-party software (mouse-over for details) Process with relevance to Financials Related scenario Info button with more information Scenario/Processes Business Value Scenario Flow Further Information + The following business roles are involved in this scenario: Warehouse Operator Sales Representative Accounts Receivable Accountant Service Planner/ Dispatcher <Role Name> <Role Name> <Role Name> i

3. Customer Return Management Process Details: Processing Inbound Delivery Notifications Click process chevrons for details X Processing Inbound Delivery Notifications - Customer Return Notifications Processing Inbound Deliveries Processing Customer Return Creating Customer Credit Memo Processing Receivables and Payments Create a Customer Return Notification i Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Processing Inspections Scenario Explorer Scenario Description Further Information The Processing Inbound Delivery Notifications process comprises the creation and use of inbound delivery notifications (IDNs). An IDN represents a delivery coming from outside. An IDN can either be an ASN (advanced shipping notification) or a printed delivery note accompanying the physical goods. An IDN of delivery type Customer Return usually precedes a standard customer sales process, over-the-counter sales process, or a third-party order process. However, it is optional for the customer returns created for repair. Creating an IDN is mandatory for customer returns, parts returns, and stock transfers and optional for the supplier deliveries. Based on an IDN, the inbound processing can always be done. You can process inbound deliveries with inbound delivery notifications with or without task support from the system. Additionally, as a follow-up activity in a third-party order process, a Return to Supplier document can be triggered. In a service process, the Repair at Own Service Center activity triggers a customer return for goods to be serviced. Performed by Warehouse Manager Scenario/Processes Business Value In the Work Center Inbound Logistics Scenario Flow Further Information +

4. Customer Return Management Process Details: Processing Inbound Deliveries Click process chevrons for details X X Processing Inbound Deliveries - Based on ASN with Task Control Processing Inbound Delivery Notifications Processing Customer Return Creating Customer Credit Memo Processing Receivables and Payments Create a warehouse request - inbound Create a warehouse task - inbound Confirm a warehouse task - inbound Accept a deviation - inbound Check and finalize an inbound delivery i i i i i Click here to display process variants Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Processing Inspections Scenario Explorer Process Description Further Information The Processing Inbound Delivery business process enables you to process the products received into a warehouse and post them to own stock or to an externally-owned stock (for third-party customer returns and for returns to repair goods). You can use the following inbound delivery types: supplier delivery, customer return (for standard sales, third-party sales orders and repair goods), (spare) parts return, and stock transfer. For supplier deliveries, you can use an inbound delivery notification or you can directly refer to the purchase order in the Post Goods Receipt screen.You can process your inbound deliveries based on an inbound delivery notification and with or without task support from the system. Based on your logistics model settings, a quality inspection can be created automatically, except for customer returns which were posted to externally-owned stock, for example, in a third-party order process. The incoming goods can then be stored in a specially designated area (for example, quality inspection stock). Performed by Warehouse Operator Scenario/Processes Business Value In the Work Center Inbound Logistics Scenario Flow See also Inbound Delivery Processing Further Information +

5. Customer Return Management Process Details: Processing Inbound Deliveries Click process chevrons for details X X Processing Inbound Deliveries - Based on ASN with Task Control Processing Customer Return Creating Customer Credit Memo Processing Inbound Delivery Notifications Processing Receivables and Payments Create a warehouse request - inbound Create a warehouse task - inbound Confirm a warehouse task - inbound Accept a deviation - inbound Check and finalize an inbound delivery i i i i i Click here to hide process variants Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Processing Inbound Delivery - Based on ASN without Task Control Processing Inbound Delivery for Externally-Managed Location Processing Inspections i i Scenario Explorer Process Description Further Information The Processing Inbound Delivery business process enables you to process the products received into a warehouse and post them to own stock or to an externally-owned stock (for third-party customer returns and for returns to repair goods). You can use the following inbound delivery types: supplier delivery, customer return (for standard sales, third-party sales orders and repair goods), (spare) parts return, and stock transfer. For supplier deliveries, you can use an inbound delivery notification or you can directly refer to the purchase order in the Post Goods Receipt screen.You can process your inbound deliveries based on an inbound delivery notification and with or without task support from the system. Based on your logistics model settings, a quality inspection can be created automatically, except for customer returns which were posted to externally-owned stock, for example, in a third-party order process. The incoming goods can then be stored in a specially designated area (for example, quality inspection stock). Performed by Warehouse Operator Scenario/Processes Business Value In the Work Center Inbound Logistics Scenario Flow See also Inbound Delivery Processing Further Information +

6. Customer Return Management Process Details: Processing Inspections Click process chevrons for details Processing Inbound Delivery Notifications Processing Inbound Deliveries Processing Customer Return Creating Customer Credit Memo Processing Receivables and Payments X Processing Inspections Inspect samples Record inspection results Decide about quality i i i Scenario Explorer Process Description Further Information The Processing Inspections business process allows you to process, monitor, and analyze inspections of products : • InspectionsatgoodsreceiptReceiving inspections for supplier deliveries, first articles, customer returns, and stock transfers • Inspections in productionIn-process control and final inspections for production • Inspections in shippingFinal inspections for customer shipments As part of this process, you inspect the samples taken for inspection, record results, make a decision about the quality of the inspected goods, and, if necessary, trigger corrective or preventive actions. Planned inspections are triggered automatically, in a suitable logistics or production model. This is an exception for customer returns which were posted to externally-owned stock, for example, in a third-party order process. Unplanned inspections are triggered manually by the user. Performed by Inspector Quality Engineer Quality Manager Scenario/Processes Business Value In the Work Center Quality Control Scenario Flow See also Inbound Delivery Processing Further Information +

7. Customer Return Management Process Details: Processing Customer Return Click process chevrons for details X X Processing Customer Return - with Credit Memo Creating Customer Credit Memo Processing Receivables and Payments Processing Inbound Delivery Notifications Processing Inbound Deliveries Check and ensure consistence of customer return Send return confirmation form to customer Check and adjust the customer return Release customer return with credit memo Trigger follow-up with sales order (optional) i i i i i Click hereto display process variants Processing Inspections Scenario Explorer Process Description Further Information The Processing Customer Return business process enables you to handle customer returns. Normally the process starts when ordered and shipped products are returned unexpectedly by the customer. After the inbound delivery is completed, you recognize a new return and initiate a confirmation form to be sent to the customer to inform him or her about the goods receipt. At this point, you can check the content of the return, such as picked quantity, notes, and return references. A return process in a third-party order processing context, is indicated by the type Return to Supplier and by assigning the supplier, supplier notification, purchase order and a current externally-owned stock quantity. A return process in a service context, is indicated by the type Repair at Own Service Center, and by assigning the current externally-owned stock quantity, along with an option to request an outbound delivery. In sales related scenarios, you can add an internal note or some information for the customer to be printed on the credit memo and also adjust pricing relevant parameters, for example, quantity to be invoiced, restocking fee, quality loss fee, and freight. Finally, you have to request a credit memo or trigger compensation delivery. Performed by Sales Representative Scenario/Processes Business Value In the Work Center Sales Orders Scenario Flow See also Receipts and Returns Quick Guide Further Information +

8. Customer Return Management Process Details: Processing Customer Return Click process chevrons for details X X Processing Customer Return - with Credit Memo Creating Customer Credit Memo Processing Receivables and Payments Processing Inbound Delivery Notifications Processing Inbound Deliveries Check and ensure consistence of customer return Send return confirmation form to customer Check and adjust the customer return Release customer return with credit memo Trigger follow-up with sales order (optional) i i i i i Click hereto hide process variants Processing Inspections • Processing Customer Return - without Credit Memo i • Processing Customer Return - with Outbound Delivery Scenario Explorer Process Description Further Information The Processing Customer Return business process enables you to handle customer returns. Normally the process starts when ordered and shipped products are returned unexpectedly by the customer. After the inbound delivery is completed, you recognize a new return and initiate a confirmation form to be sent to the customer to inform him or her about the goods receipt. At this point, you can check the content of the return, such as picked quantity, notes, and return references. A return process in a third-party order processing context, is indicated by the type Return to Supplier and by assigning the supplier, supplier notification, purchase order and a current externally-owned stock quantity. A return process in a service context, is indicated by the type Repair at Own Service Center, and by assigning the current externally-owned stock quantity, along with an option to request an outbound delivery. In sales related scenarios, you can add an internal note or some information for the customer to be printed on the credit memo and also adjust pricing relevant parameters, for example, quantity to be invoiced, restocking fee, quality loss fee, and freight. Finally, you have to request a credit memo or trigger compensation delivery. Performed by Sales Representative Scenario/Processes Business Value In the Work Center Sales Orders Scenario Flow See also Create an Invoice or Credit Memo with Reference to Preceding Documents Further Information +

9. Customer Return Management Process Details: Creating Customer Credit Memo Click process chevrons for details X X X Creating Customer Credit Memo Processing Customer Return Processing Receivables and Payments Processing Inbound Delivery Notifications Processing Inbound Deliveries Release the credit memo Transfer invoice requests into a credit memo i i Processing Inspections Scenario Explorer Process Description Further Information The Creating Customer Credit Memo business process enables you to create and handle credit memos. After you perform a goods return, the system automatically creates invoice requests that you must transfer to a credit memo sent to the customer. The credit memo is also passed to cash flow management in order to trigger the related payment, for example by check, bank transfer, or credit card. This transfer can be done using an invoice run, or manually. It is possible to combine several invoice requests into one credit memo or split them into several credit memos. You can also create a credit memo manually. Performed by Accounts Receivable Accountant Scenario/Processes Business Value In the Work Center Customer Invoicing Scenario Flow See also Create an Invoice or Credit Memo with Reference to Preceding Documents Further Information +

10. Customer Return Management Process Details: Processing Receivables and Payments with Accounts Maintenance - Standard Click process chevrons for details X X X Processing Receivables and Payments with Accounts Maintenance - Standard Processing Customer Return Creating Customer Credit Memo Processing Inbound Delivery Notifications Processing Inbound Deliveries Clear open items and differences i Processing Inspections Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Scenario Explorer Process Description Further Information The Processing Receivables and Payments with Accounts Maintenance - Standard business process enables you to monitor customer accounts on a regular basis. You can clear any remaining open items and write off small differences manually. Performed by Accounts Receivable Accountant Scenario/Processes Business Value In the Work Center Receivables Payment Management Cash & Liquidity Management Scenario Flow See also Quick Guide for Payment Allocation Further Information +

11. Customer Return Management Business Value Initiate Settle Manage Receive Customer Return Delivery Create Customer Return Notification Release Proposalfor Payment Manage Payment Based on Credit Memo Post to Ledger Initiate Inbound Processing Post Goods Receipt With or Without Tasks Scenario Explorer Overview Key Benefits • Well-managed returns can translate into sales opportunities • Tracking allows companies to stay on top of each return by monitoring its logistics and refunding status, and the corresponding logistics and financial documents • Better transparency, enabled by adherence to applicable business rules, allows you to provide accurate informationforcustomerqueries • By identifying the reasons for returns, quality is improved • Using return sales rate reports that show the return rate for each month of the current year helps you to monitor quality levels This scenario streamlines the customer returns management for midsized companies. SAP Business ByDesign supports the entire customer returns management cycle - from delivery notification and the physical product return through to payment based on a credit memo. You can increase customer loyalty with efficient returns processes. Scenario/Processes Business Value Scenario Flow Further Information +

12. Processing Payments with Accounts Maintenance - Standard Variant • With Credit Memo • Without CreditMemo • Based on ASN w/o task control • Based on ASN w/ task control • Based on ASN from Warehouse Provider • Process variant1 • Process variant 2 Customer Return Management Scenario Flow • Payables • Payment Management • Inbound Logistics • Sales Orders • Customer Invoicing ProcessingReceivables and Payments Creating a Customer Credit Memo Processing Inbound Delivery Notification Processing Inbound Delivery Processing Customer Return Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales Service and Repair Order-to-Cash (Sell-from-Stock) Order-to-Cash (with Specified Products) Order-to-Cash (Third-Party Order Processing – Material) Over-the-Counter Sales • Quality Planning Scenario Explorer Processing Inspections Scenario/Processes Business Value Scenario Flow Legend Dotted line = optional Dotted line = optional Further Information Work center in which process is performed Process related to Financials : + Process mainly driven by the user Process mainly driven by the system Additional Application Work Center Business document flow Related scenarios

13. Customer Return ManagementFurther Information Scenario Explorer Do you want to try it out? Do you need more information? Do you want to discuss with others? Business Process Procedure(90-120 min*) To get a comprehensive how-to documentation to run the business scenario, click here. More Details(30-90 min*) SAP provides a complete product documentation, covering all aspects of the business scenario. For more details, click here. Forum Get in touch with experts to discuss your specific requirements. To enter the community, click here. Scenario/Processes Business Value Scenario Flow Self-Enablement Systems If you want to try out the business scenario, click here. WIKI In addition to the product documentation, SAP provides Wikis that describe additional aspects of a business scenario. To access the WIKI, click here. V V Further Information + * The time values are given as an orientation for the required time you need to get through the information on one scenario. Since some scenarios are shorter than others, the minimum time refers to the shortest scenario and the maximum refers to the longest. The actual time you will need depends on your level of knowledge and your interest in the topic.