How to manage the Vendor supplied components in Subcontracting scenario.

Question

Hi experts ,
I have to complete the finished product say "A" by subcontracting scenario.
I am supplying A1, A2, A3 to the vendor as components.
Component A4 is the item required for the final product "A" but this will be supplied by the Vendor.
Please let me know how can I handle both the material movements and the cost of the product in this scenario thru Subcontracting PO.
Thanks & regards,
Rachan.

Answer 1

what did your purchasing department negotiate?
do you get billed for the component A4 separately? or is the cost for A4 inlcuded in the service charge for subcontracting?
does your purchasing department order A4?
is it in your bill?
if it is in your bill and you create an extra order for this part, then you should set the SC flag in the delivery address tab of your PO along with the vendor number of your subcontractor.
Subcontractor will then tell you when the material arrvied and you post a goods receipt, this is then directly posted into special stock at subcontractor. When you receive the finished material A and post GR with MIGO all components will be issued.
you will then receive a bill for subcontracting fee that is posted to your subcontract order, and another bill for the component A4 that is posted to this component order.
If costs are included in subcontract fee, then you dont need to manage inventory, do not need an extra PO and extra invoice, and dont need the A4 in your BOM
Edited by: Jürgen L. on May 6, 2010 9:01 AM