How to Effectively Manage Purchase Order Cancellations

Oct 30, 2021 | Basic 101: Introduction to procurement

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Oct 30, 20213 min read

Automating the cancellation and return process can improve customer experience, streamline operations, reduce errors, save time, and provide clear instructions. A tracking system can also help identify trends in cancellations and returns, allowing for improvements in customer service and product quality.

Returns and cancellations are an inevitable part of doing business. Goods suppliers likely experience goods rejections and cancellations of purchase orders. It is important to understand the process for handling these requests and to establish a standard policy for returning and canceling orders. Automating the process can also help make it easier for businesses to manage refunds, returns, and cancellations. 

Understanding the Cancellation and Return Process 

The purchase order cancellation and return process begins with the customer submitting a request. This request can be made either in writing, such as via email or letter, or verbally via phone call. On FactWise, rejections at goods receival and quality check stages are entered within moments on the system itself, following which all stakeholders are notified and updated. Users can provide enough information to allow a clear understanding of the reason for their rejection, including notes, images, attachments, and any other information. Depending on the nature of the request, such as whether or not it involves a refund, additional documentation may be required. 

Once the customer's request has been received, the process for handling it should be determined. This will include providing clear instructions on how to initiate or complete the cancellation or return process. All relevant details should be included, such as deadlines for returning the goods, paperwork that needs to be submitted, contact information for customer service representatives, and any other information that is needed. 

It is important to ensure that the customer is kept informed throughout the process. This can be done by providing regular updates on the status of their request, as well as any changes that may occur. Buyers can reschedule rejected quantities from within the FactWise source-to-pay ecosystem, with just a couple of clicks. Suppliers can accept or reject the reschedule timelines, and request modifications. Additionally, customers should be given the opportunity to ask questions or provide feedback on their experience. This will help to ensure that the process is as smooth and efficient as possible. 

The Benefits of Automating Cancellation and Return Processes 

Automating PO management processes via robust goods tracking can help streamline operations and improve buyer-supplier relationships. Automating the process can help reduce errors, save time, and provide teams with an easier way to manage their requests. Automation can also help reduce paperwork, improve accuracy and collaboration between internal and external teams. 

Having a tracking system in place can also help suppliers identify any trends in customer cancellations or returns. This can help identify any areas of improvement required (product quality, logistics, etc.) and make changes to ensure that customers are satisfied with their experience.  

In conclusion, managing purchase order cancellations and returns is an important aspect of any business. With FactWise a holistic SaaS solution, companies can implement strategies such as having clear PO terms, using technology to streamline the process, offering multiple reschedule or reject options, promptly processing returns, and using data to track and analyze feedback. FactWise Source-to-Pay features intuitive, customizable workflows for goods receival and multiple quality checks that ensure accuracy against PO data. Users can add details, images, attachments and additional information at every step to ensure the highest level of transparency and collaboration between internal and external supplier teams. PO management is simplified and users can reschedule rejected quantities within moments, while suppliers can accept or reject delivery timelines and request modifications. PO remarks enable users to communicate with ease, and accurate, on-time payment reminders ensure that users pay only for accepted quantities. FactWise is committed to transforming the procurement journey for buyers and suppliers globally.

About the Author

Stawan is the founder and CEO of FactWise. Before founding FactWise, Stawan was the NA TMT-Procurement Leader at McKinsey. Passionate about procurement, Stawan has 15 years’ experience in enabling clients of all sizes to achieve business impact via procurement.


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