ANS-1443 · SALES ORDER PROCESSING
How to Efficiently Process Drop Ship Order Returns in NetSuite?
NetSuite users can manage drop-ship returns by either utilizing a temporary inventory location or by employing a non-inventory item to avoid tracking physical stock.
Short answer
NetSuite provides two main methods for processing drop-ship returns. Users can either establish a temporary 'Dropship Returns' location for physical inventory management before vendor return, or utilize a non-inventory 'Dropship Returns' item to process returns without affecting inventory records, often aligning with direct-to-vendor return processes.
Scenario
Organizations utilizing drop-ship orders in NetSuite often face challenges when customers need to return these items. The primary concern is how to accurately process these returns within NetSuite, ensuring proper financial and inventory tracking, especially when the item may not physically return to the company's own warehouse.
Solution
NetSuite users have two primary approaches for managing drop-ship order returns:
Utilize a Temporary Inventory Location:
- Establish a dedicated "Dropship Returns" location within NetSuite to serve as a temporary holding area.
- Process customer returns by accepting the drop-shipped item into this designated "Dropship Returns" location. This method involves temporarily tracking the item in company inventory.
- Subsequently, initiate a return to the vendor, shipping the item out from this temporary location.
Employ a Non-Inventory Item for Returns:
- Create a "Dropship Returns" item configured as an 'Other Charge' non-inventory item.
- Process customer returns by accepting this non-inventory item. This approach ensures that no physical inventory is tracked as a result of the return, which often aligns with NetSuite's native handling of drop-ship returns where items are returned directly to the vendor without entering company stock.
- Proceed to initiate a return to your vendor, referencing this same non-inventory item.
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