1.Objective

In order to avoid the non-benfen behavior and standardize the management of IW, OOW, DOA Materials, especially standardize the management process of key materials, such as motherboard and screen.

2.Application Scope

This guidance is applicable to all customer service center personnel in all regions and all IW, OOW, DOA Materials.

3.Obligation

a.Branch /Service center warehouse keeper or manager: collect and classify all faulty materials, and send to Central/National warehouse every month.
b.Central/National warehouse keeper or manager: collect all faulty materials from service center, and send to the factory designated area or arrange the local scrap according to the guidance from HQ.
c.HQ spare part team (China) : check the quantity and status of all faulty materials in all regions, arrange the return or scrap process;
d.Factory Audit Department: responsible for audition and supervision of all accounts, physical quantity and materials status.

4.Definition

Faulty material herein after includes IW, OOW, and DOA Materials.
IW Material：Material produced by non-artificial damaged during the warranty period;
OOW Material：Material produced by artificial damage or maintenance happened out of the warranty period;
DOA Material：The unused but defective material is found during the receiving or maintenance period.

5. IW/OOW Defective Materials Management Process（By Role）

5.1 Service Center Warehouse Keeper or Manager

5.1.1 Tracking all in and out records of each material everyday, all material consumption records need match the order records one-by-one. 
5.1.2 Collect all IW or OOW materials according to the repair order or engineer consuming records, classified all IW or OOW faulty materials according to the dates, and ensure that the faulty material returned by engineer correct packed and posted with fault identification sticker. 
5.1.3 Collect and organize all IW or OOW materials list and check the material object based on one week or fortnight material consumption quantity in the repair order, then make the faulty materials return application in the after-sale system. 
5.1.4 Print out all lists and put them into the return packing box, ensure all boxes well packed, then arrange the delivery to central/national warehouse, and track the arrival of the materials. 
5.1.5 Handle the differences if there is any. If not, the process ends.

5.2 Central/National Warehouse Keeper or Manager

5.2.1 Download material consumption report of last month in salesforce system before 10th of each month. Check and classify all material in accordance with the IW and OOW. Send the feedback and track the reason if there is any difference (There is no strict control over the materials with a unit price of 3USD or less).
5.2.2 Confirm the actual receipt quantity in the system. If there is any difference of the material, allows the service center arrange to send back together with the materials of next month. If not, supervisor of the service center should find out the reason, and formulate local faulty material loss penalty rules. The factory will deduct the amount of all missing faulty parts at the same time.
5.2.3 Central/National Warehouse should send the materials to designated area according to the types of material before 25th of each month. If there is no specified designated area, please sort by category and reserve all materials in the warehouse. HQ spare part team and audit person will arrange the regular physical check and on site scrap synchronously or ask local scrap after all spare parts formal written notice confirmed.

5.3 HQ Spare Part Team (China)

5.3.1 Faulty material sent to the designated area: HQ Spare Part Team will received and check all the quantity of the faulty material based on the number derived from the salesforce system. If there is any missing or shortage of in warranty faulty material, the deductions file will be made accordingly (one month extension will be allowed for the shortage return).
5.3.2 Faulty material reserved in central warehouse: HQ Spare Part Team will arrange the regular physical check and on site scrap semi-annually or quarterly. Or ask local scrap after all spare parts formal written notice confirmed. 

6. DOA materials management process（By Role）

6.1 Service Center Warehouse Keeper or Manager

Local technical support personnel judge the DOA material according to "guidance for DOA materials judgment”: Once confirmed the material belongs to DOA, please input the quantity of it in corresponding module of the salesforce system before the end of each month. Market temporarily without salesforce system can make offline file for record. 

6.2 Central/National Warehouse Keeper or Manager

Collect back all DOA materials regularly every month and put all of the materials in the certain areas of the warehouse. Send all detailed offline records to the factory regularly.

6.3 HQ spare part team (China)

6.3.1 Calculate the actual return rate of DOA materials in each market and compare the rate return provided by the quality department. (More specific see table 1)
a)The actual return rate of DOA materials within the range provided by the quality department, the HQ spare part team will make the financial verification directly on the basis of scrap materials provided.
b)The actual return rate of DOA materials beyond the range provided by the quality department, the quality department director should decide whether need some samples back for quality analysis, or appoint commissioner to do quality special investigation at the scene according to the actual situation. The HQ spare part team will only make the financial verification after the investigation finished and all data confirmed reasonable.
6.3.2 HQ spare part team and audit person will arrange the regular physical check and on site scrap synchronously or ask local scrap after all spare parts formal written notice confirmed.

Table 1. (Note: DOA ratio range provided by quality department was generated from a comprehensive analysis material data in the factory) 
A, All DOA motherboard should provide serial number for quality screening; 
B, DOA material processing application form for attachment.

7. Faulty material scrap requirements

7.1 All scrapping arrangements should comply with local relevant laws and regulations such as environmental protection requirements of each market. 
7.2 Make sure all three parties signed documents (Local warehouse manager/factory site inspectors, the regional customer service manager, agent financial personnel or managers), scrap pictures have been send to the factory after scrapping.
7.3 All documents should reserved at least one year for future checking.

8.Other relevant issue

8.1 IW faulty material: not allowed to provide to the end user. Any missing or shortage material during this month is allowed to sent back one month later. If unable to make the compensation next month, factory will deduct the money of agent account. Materials with ex-factory price not above 3 usd will not take into consideration if there is any differences, but the service center need try their best to return to the central warehouse.
8.2 We need check the CID quantity of IW faulty motherboard or screen. Corresponding deductions will be made if the part which can not meet the standard of warranty principle (Special warranty record is excluded).
8.3 Service center does not offer OOW faulty material to the end user especially the mainboard and top cover assembly. If the end user ask to take away the material initiatively, we must indicate in the work order "faulty material is expected to take". Dealer requires to take away faulty material, he or she need to provide relevant written signature files/work order to prove it.
8.4 HQ spare parts team will analysis the return proportion of OOW motherboard and screen of each region every month. The result which less than 15% of the group A/B average level will effect the annual performance assessment of materials in 2018.
8.5 Any non-benfen behavior been found during the inspection process, the related punishment will be executed in accordance with “OPPO Overseas Customer Service Center Non Ben-fen Behavior Regulations _V3.0”. 

9. Update Record

This document shall be implemented from the date of promulgation!