How to Cancel a Drop-Ship PO for Stock Items in Acumatica

Do you have inventory items you do not stock?

Using a drop-ship PO to have the vendor fulfill the sales order is a common and seamless process with Acumatica. In most cases, the drop-ship sales process is completed when the customer receives the items from the vendor and the corresponding AP and AR documents are released. But what happens if the dropped-shipped item is delivered in unsatisfactory condition, or the wrong item was received?

In Acumatica, you can process the return of drop-shipped items directly from a customer to a vendor, without receiving the item into your inventory. There are four simple steps to ensure the customer receives their credit, and you receive a debit adjustment from your vendor.

How to Process Drop-Ship Vendor Returns:

Step 1: Create a Return Order

Navigate to Sales Orders > Transactions > Sales Orders and create a new sales order
Change Order Type to one with the RMA Order automation behavior (e.g. RC – or Return for Credit)
NEW in 2023R2 – You can now create a return order directly from a Case, by choosing Create Return Order from the More (…) menu.
Select the Customer, and optionally add a description
Click Add Invoice, choose the invoice with the drop-ship item in Reference Nbr: field, select the line(s) of item(s) to be returned, then choose ADD & CLOSE. Above steps are shown below:

Note that the Mark for PO check box is selected, and the PO Source is Drop-Ship. This indicates the item has been previously drop-shipped to the customer and should not be shipped to your company’s warehouse, as shown below:

If necessary, click REMOVE HOLD then Save on the form toolbar.

Step 2: Create and Release a Direct Purchase Return

While you are still viewing the return order, from the More (…) menu, click Create Vendor Return.
The Shipments tab displays the direct purchase return for the vendor. Click the link in the Document Nbr. box, as shown below:
The Purchase Receipts form with a Type Return opens for the vendor. Click Release:

Step 3: Enter the Debit Adjustment

While you are still viewing the Purchase Receipts form, click ENTER AP BILL on the form toolbar to create a debit adjustment on the Bills and Adjustments form for the vendor.
Choose Remove Hold, and then click Release:

Step 4: Prepare and Release a Credit Memo for the Customer

To process the return of money to your customer, do the following:

Return to the Return Order created in Step 1 above (closing out the Bill and Adjustments window from Step 3 will likely return you here immediately)
Click PREPARE INVOICE on the form toolbar (you may need to refresh your browser to see this option)
The Invoices form with a type of Credit Memo is opened as shown below:
Click RELEASE from the form’s toolbar.