## Zoho Inventory Documentation Index

Access the complete documentation index at:
https://www.zoho.com/uk/inventory/llms.txt

Use this file to discover all available documentation pages before proceeding.

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# A customer has requested a replacement for a defective product. How do I handle this in Zoho Inventory?

> **Assumption:** The shipment has been delivered and the invoice has been paid.

To handle an exchange for this order in Zoho Inventory:

#### Step 1: Create a sales return

*   Go to the sales order.
*   Click on **Create > Sales Return**.
*   Check the option **‘This sales return contains credit-only goods’**.
*   If you don’t want the item to be taken into stock, then enter the appropriate quantity in the ‘Credit-Only’ field for that item.
*   Save the sales return with only the items that have to be exchanged.

#### Step 2: Create a credit note

*   Open the sales return.
*   Click on **More > Create Credit Note**.
*   Save the credit note with only the items that were returned.

#### Step 3: Create a new sales order

*   Navigate to the **Sales Order** module on the sidebar.
*   Click **\+ New** button.
*   Add the exchange items to the list.
*   Save the sales order.

#### Step 4: Create an invoice for the new order

*   Open the new sales order.
*   Click on **Create** and select **Invoice**.
*   Click **Save** to associate an invoice with the new order.

Keep this invoice unpaid.

#### Step 5: Apply credits to the invoice

*   Open the credit note created in step 3.
*   Click on the **Apply to Invoice** button.
*   Against the newly created invoice number, enter the invoice amount in the **Amount to Credit** field.
*   Click **Save** to apply the credits. This will offset the invoice amount and completes the exchange process for that order.