Overview

If you are using a returns solution (i.e. Loop Returns, Happy Returns) to handle exchanges, please make sure that you have discussed the reconciliation process with your Customer Success Manager.

By default, Loop and Happy Returns will handle an exchange by appending the original sales line in Shopify with the return units, return retail, and return cost. It will then create a new sales line to capture the exchanged item. In doing so, the raw data in Shopify will have inflated discount and deflated retail values which are then corrected by Toolio prior to importing the data. You can think of this process in 4 steps:

  1. Original Sale is made

  2. Return is Appended to the original sale

  3. Exchange is Created in a new sale line

  4. Toolio corrects the new sale line before importing

Please see an example with a step by step walkthrough below, along with the effect on Net Sales shown at each step:


1. Original Sale

For the original sale:

Sale Id

Sales Retail

Sales Units

Sales Cost

Returns Retail

Returns Units

Returns Cost

discount

123

$100

1

$50

-

-

-

-

This sale line will have the following effect on Net Sales:

Net Sales Retail

Net Sales Units

Net Sales Cost

Discount

$100

1

$50

$0

2. Returns Appended

When an exchange is initiated, a return will be attributed to the original sales line which will result in the Net Sales Retail, Net Sales Units, and Net Sales Cost value calculating to 0 for this sale (Net Sales = Gross Sales - Returns).

Sale Id

Sales Retail

Sales Units

Sales Cost

Returns Retail

Returns Units

Returns Cost

discount

123

$100

1

$50

$100

1

$50

-

Effect on Net Sales:

Net Sales Retail

Net Sales Units

Net Sales Cost

Discount

$0

0

$0

$0

3. Exchange Created

Loop and Happy Returns will then create a new sales line to capture the exchanged units. This line will have a Sales Retail value of $0 and a Discount of the full retail value. This sale line will also be tagged with a discount code/order tag of "loop-discount" or "happyExchange."

Sale Id

Sales Retail

Sales Units

Sales Cost

Returns Retail

Returns Units

Returns Cost

discount

124

$0

1

$50

-

-

-

$100

If we were to take this information at face value, the effect on Net Sales will appear as below (Please note that Net Sales deducts discount):

Net Sales Retail

Net Sales Units

Net Sales Cost

Discount

$0

1

$50

$100

4. Toolio's Correction

Because the Net Sales for the original transaction was already decremented to 0 previously, the new sale line created by Loop/Happy Returns will result in incorrect Net Sales calculations.

To resolve this issue, Toolio will add the Discount value back to Sales Retail when the discount code/order tag contains "loop-discount" or "happyExchange." Additionally, Toolio will set the Discount value to 0.

Type

Sale Id

Sales Retail

Sales Units

Sales Cost

Returns Retail

Returns Units

Returns Cost

discount

Original

124

$0

1

$50

-

-

-

$100

Adjusted

124

$100

1

$50

-

-

-

$0

This will result in the following for Net Sales:

Net Sales Retail

Net Sales Units

Net Sales Cost

Discount

$100

1

$50

$0

You will also still see the following for Gross Sales and Returns:

Gross Sales Retail

Gross Sales Units

Gross Sales Cost

Discount

Returns Retail

Returns Units

Returns Cost

$200

2

$100

$0

$100

1

$50

If you have any questions around how this process works in your account, please reach out to your Customer Success Manager.

Related Articles:
Toolio Integration Guide
http://help.toolio.com/en/articles/4697543-shopify-integration

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