Vendor returns / damaged or borrowed product

There are times where you may need to return product to a vendor or move it out of your store.  While you can simply modify the quantity on hand that may not be the best method for a few reasons like:

A)  You want to have a better paper trail to track things
B)  If there are a lot of things that need to be adjusted and modifying inventory one at a time isn't efficient

In these cases you can create a purchase order with negative quantities.  Yes - a purchase order is typically used to receive product from suppliers however it also has the ability to accept negative quantities which will, instead of increasing your inventory, decrease it.

Examples of where this can be handy are:

Suppliers providing you with credit on an invoice
This would be like a normal purchase order where some lines with a a positive quantity, some with a negative (the credit items)

Suppliers or other parties borrowing product
Simply create a PO and add notes to it to explain the situation and add products to it with the negativity quantity for the items being borrowed and set the status to "Inventory received".  When the product is returned make the PO inactive.  This will keep it in the system for record keeping purposes but since it's inactive it won't affecting your inventory or costing.

Damaged product being returned to supplier or being thrown away
Simply create a PO and add notes to it to explain the situation and add products to it with the negativity quantity.  Set the PO status to "Inventory received".  This will reduce it from your inventory.  NOTE: Make sure the cost is set properly for the items that you are removing from your inventory.

We hope this is helpful!



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