Preventing returned items from updating the Inventory and getting valued as Regular stock


Customers may not want returned items/merchandise automatically put back into the inventory when the Credit Memo is issued as these items are often defective and should not go back to the main inventory.


Follow these steps to ensure returned items are not automatically updated in the main company inventory:

  1. Create a new Stock Bin of Stock type "Defective" by going to Inventory > Stock Areas > New Stock Bin
  2. Save the Stock Bin details.
  3. Assign the newly created bin as the default Stock Bin for Credit Memos by going to File > Setup > Accounting > Location/Sub-Location. Edit your default location by double-clicking the Location and open the Stock Transfer tab > Sales Document sub-tab.  Select stock bin created previously as the default stock bin for Credit Memo in the Select stock bin to transfer inventoried items into when creating section as shown:

  4. Periodically Write off the items from this stock bin using Inventory Adjustment if you do not want them in stock at all. Refer to the Quantity Adjustment video for more information on Write-offs.

    Important: Items in the 'Defective' bin are included in the total available inventory and are still valued as regular stock in the Inventory Summary Report unless they are moved into the 'Released' bin through a Quantity Adjustment process. It is not possible to automatically move the returned items to the 'Released' bin

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