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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Need to Service Warran...
Small and medium business | Business Central, N...
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Need to Service Warranties in BC

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Posted on by smith5ba 25

Hi, 

My company sells products with a 12 month warranty and often sell extended warranties that start at the end of the factory/base warranty. These warranties cover pretty much everything from quality issues to damaged parts. Some of our extended warranty programs offer full replacement of computer components at the end of the 5 year warranty period. We are looking for the best way to manage these. we would like to use service contracts to manage this as many of our customers have purchased multiple products or have multiply warranties. We also want to track service on products to understand when there might be an issue with a specific component and understand the profitability of the warranties that we sell. 

Our biggest issue is double invoicing customers for the price of the warranty (customers pay upfront and we bill using sales orders) when we create the service contract. Does anyone know a way around this? We want to track the cost of the warranty in the service contract as we use that price to send customers quotes to renew warranties. Currently we have to issue a credit memo for every order to clear out the extra AR created when we make and invoice a sales order. 

Thanks,

Ben

  • Suggested answer
    Community Member Profile Picture
    Community Member on at
    RE: Need to Service Warranties in BC

    Ben,

    The Sales Order Line I will leave alone since you are recording and using the Deferred method to amortize that revenue over the 12 month period.

    As for Service Module, I am attaching my manual that breaks down all the functionality so you can better utilize Service for your company. There have been additional features added after the manual was written, but this will give you the majority of features and functionality to start. This will answer the tracking, warranty, invoicing, and other features within Service.

    Read this over and email if you have more questions.

    Hope this helps.

    Thanks,

    Steve

    NAV2009_5F00_ENUS_5F00_SM.zip

  • smith5ba Profile Picture
    smith5ba 25 on at
    RE: Need to Service Warranties in BC

    Steven,

    We are offering standard warranties on normal goods that we sell through Sales Orders and need to defer only the revenue related to the associated warranty for 12 months. We add the warranty SO line (which is the value of the warranty component of the sales price) so the system will post a journal entry to Deferred revenue for that amount instead of the normal revenue account for the entire sales order. When we ship warrantied items the system automatically creates a service item and we are simply trying to understand how to utilize this part of the system to its fullest potential.

    We want to track products sold and the related warranties in the Service module. It helps with serial number tracking and understanding what components are being replaced most often. It also lets us know when the standard manufacturers warranty is about to expire and we can then send a quote or renewal notice to the customer for their warranty. 75% of our customers renew their warranties and maintaining the service history over the first year (manufacturers warranty) is a requirement for or service team. We also have customers that reach back out to us 2 or three years after purchase wanting to purchase an extended warranty. Having a previously expired service contract in Dynamics will help to speed that process up. The last reason that we want to use the service module to track our warranties is it makes recognizing the deferred revenue related to warranties very easy using the "Post Prepaid Service Contract Entries".

  • Suggested answer
    Community Member Profile Picture
    Community Member on at
    RE: Need to Service Warranties in BC

    Ben,

    Are you adding a Sales Line to the Sales Order to denote the prepayment of the Warranty Contract vs. creating a Service Contract Prepayment Quote and using that to create the Service Contract and Invoice to pay against?

    If I am going to prepay the Service Warranty Contract and track this I will disconnect the Sales Order from the Service Contract.

    Have you tried a Service Contract Quote?

    Thanks,

    Steve

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