If a customer cancels an order or returns items you need to identify whether items have been shipped and received back, whether the customer has paid and if they have do they need refunding or will you give them credit towards a future purchase?
Refunds and returns
Cancellations
Deleting
Depending on what stage your order has reached you will be able to cancel the order or you will have to create a sales credit to reverse the original order. This decision tree should help you identify what the correct course of action is:
Refunds and Returns
Where a customer has placed an order, received the items and paid but then returned the items you will need to create a sales credit in Brightpearl. It is then up to you whether you refund the customer or leave the amount as a credit on their account against future purchases. If items have been returned by the customer, these can also be received back in from the sales credit. Follow these steps for refunds and returns:
1. Clone the Brightpearl sales order to a sales credit
2. Refund the customer / leave the amount on account
3. Deal with any returned goods
1. Clone the sale to a credit
To record the returns in Brightpearl you will need to create a sales credit:
- Search for and open the original sale.
- Click the drop-down menu on the edge of the Save changes button within the sale.
- Select Clone to credit note.
- The credit note is displayed; it looks very much like the sale, but has a reference beginning with SC#. You will also see the link to the parent order (the original sale) at the top.
- Click the Credit button at the top (this is similar to invoicing a sale).
This will lock the sales credit to any changes, update the customer's account and post an accounting journal to reduce sales, tax and debtors as necessary. It won't refund the customer their money, we'll look at that later.
To create a credit note from scratch follow these steps:
- Go to Sales > New Credit.
- Search for and select the customer record.
- Add line items to the sales credit by searching for inventory items or typing the description.
- Check the account code and tax code.
- Enter the quantity and price; enter as a positive values, Brightpearl knows this is a sales credit and will apply the values as such.
- Click Save changes.
- Click the Credit button to post the credit to accounts and update the customer account balance. The credit can no longer be amended. (This has the same effect as "Invoicing" a sales order).
- Click the Email/Print button to produce the credit note document and send it to your customer.
2. Refund the customer / leave the amount on account
When the customer has already paid for the original sale you will usually either refund the money or give them a credit against a future purchase (or outstanding debt).
Refund the money
For refunds you need to ensure 2 things are done. Firstly that the customer gets their money back, and secondly that the refund is recorded in Brightpearl.
Refunding the customer's money will depend on the payment method you are using. You will need to log into your payment provider account and manually create the refund, including PayPal (UK ONLY - unless you have used the Brightpearl integration with SagePay or SecureTrading - If you ARE using one of these integrations you will be able to generate the actual refund to the customer during the process of recording it in Brightpearl).
All refunds will need to be recorded in Brightpearl accounting. This will need to be done manually for each refund, except PayPal refunds which can be downloaded.
- From within the cloned sales credit, scroll to the bottom.
- Click the Do refund button.
- Complete the displayed fields (UK ONLY - If you have integrated with a payment provider you will be able to use the links to go there now and process the refund).
- Click the Allocate payment button.
This will update the sales credit to show the amount was refunded, clear the credit from the customer's account and post an accounting journal to decrease your bank account. Remember, you will need to send the money to the customer separately.
Leave the amount on account
If your customer is to be given a credit for use against future purchases (or any currently outstanding debt) you can leave the amount on their account. To leave the amount on account you don't need to do anything else; after you have raised the sales credit it will be displayed on the customer account until it is either refunded or allocated against any other debt (invoices). When the customer makes a purchase in the future, or if they have outstanding debt currently, you can allocate the sales credit to the invoices:
To allocate (match) the payment (and or credit note) to the invoices:
- Click the Pay in full button next to ALL of the invoices AND the sales credit.
- Ensure the total at the bottom is ZERO, you are not taking any payment, just matching.
- Select the bank account and if you want, enter a reference (optional).
- Click the Allocate payment button to finish.
The items are cleared from the account. You can still see the items in the customer's financial history. In the accounting the payment will be updated with the invoice numbers it has paid.
3. Deal with any returned goods
If goods have been returned you will need to receive them and then decide what you going to do with them:
- From within the sales credit, click the Receive inventory button.
- The items are received into "quarantine". This means they won't yet be available to sell, just in case they are damaged for example and you want to put them into scrap.
Quarantined Inventory Quarantined inventory cannot be sold until you have confirmed in Brightpearl to bring it into your main inventory by giving it a warehouse location. Quarantined inventory is listed on the Inventory in Transit screen; this is also where any warehouse transfers are listed ready to be brought into inventory.
Return items to inventory for reselling
This means you need to move the items out of quarantine and back into normal inventory.
- Go to Products > Inventory in transit.
- To release an item or multiple items back into inventory (if you are using locations this will use their default location), tick the checkbox next to the item and then click the Release items button above. (If you use locations and want to move the items into a location other than the item default click the Actions icon on the far right of the item).
You inventory levels are immediately updated and in turn the items will be available on all your sales channels such as eBay or Magento.
Scrap items that cannot be resold
To scrap items and write of the value you will need to firstly move them into normal inventory and then do an inventory correction to remove them. If you are using locations you might choose to bring them into a location specifically for "damaged goods".
- Go to Products > Inventory in transit.
- To release an item or multiple items back into inventory (if you are using locations this will use their default location), tick the checkbox next to the item and then click the Release items button above. (If you use locations and want to move the items into a location other than the item default click the Actions icon on the far right of the item).
- Go to Products > Remove inventory.
- Click the link to go to the inventory detail report.
-
Find the product and click the in stock figure to edit it.
Note: Products are listed separately for each cost they have been received at, and separately for each location they have been placed in (if you are using multiple concurrent locations). - Enter the quantity to remove from inventory.
- Click the Remove items button to finish.
This will reduce your inventory quantity and create an accounting journal to adjust the inventory value appropriately. This journal will credit your inventory nominal code and debit the inventory corrections nominal code (defined at Setup > Company > Accounting: Nominal codes).
Changing the cost value
As returned inventory automatically takes the value of the original sales price it is probably preferable to adjust the value to something more realistic. Follow these steps to do this:
- Go to Products > Inventory detail.
- Search for the returned product; the product will be listed for each different cost price.
- Next to the relevant cost price click the Edit pencil icon.
- Enter the new cost price and enter a reason for the change.
- Select the nominal code the difference should be expensed to.
Reselling the inventory
Once the item has been put back into inventory and you have adjusted the cost value it is ready to be sold. It acts like any other product in your inventory.
Return items to your supplier
If you are returning items to your supplier and want a credit or refund from them you will need to firstly move the items into normal inventory as above and then do an inventory correction to remove them from inventory so they are not sold. You will need to make sure they are packed up and sent or collected by your supplier. You will also need to create a purchase credit to your supplier for the refund or credit from them to you.
Learn more about purchase credits
Scrapping/writing Off inventory
If returned inventory is unsaleable and you are not able to return it to the supplier you will have to scrap it and write the value off. You do this using an inventory adjustment.
Learn more about inventory corrections
Cancelling Orders
Orders that have not been shipped or invoiced can be cancelled rather than having to create a sales credit. Cancelling will release any reserved inventory (allocated) back into on hand, immediately updating your availability on Magento (and other sales channels). Cancelled orders will not be listed in your sales reports unless specifically requested using the filters.
Cancel the order in Brightpearl
To cancel an order you will require a "cancelled" sales order status in Brightpearl. Create one at Setup > Sales > Sales statuses Setup > Sales > Sales workflow.
Orders cannot be cancelled if it has been paid, but a payment can easily be reversed by recording a negative payment against the order:
- Search for and open the sales order in Brightpearl.
- Click the Take payment button at the bottom of the screen.
- Select the bank account, enter a reference and enter the amount that you will refund as a NEGATIVE figure (with a minus sign).
- Click the Allocate payment button.
- This process will not actually refund the customer, so you now need to refund the customer their money.
Cancel an order in Brightpearl by moving it to your "cancelled" status. You can do this from within the order or using the batch processing buttons on the recent sales list.
Deleting an order in Brightpearl
If are going to delete an order in Brightpearl it must be unpaid, unshipped and not invoiced. You are now able to delete the order from Brightpearl by clicking on the trash can on the recent sales list. Once deleted there will be no record of the order.
