Sub-contracting job work

Hi all
Customer (X) sending raw material to my client (ABC) for subcontracting work, after completing job work that is delivered to customer(X).But that raw material delivered directly from some vendor of customer (X).So Excise gate pass for ED credit comes along with raw material. In this case my client avail credit of ED and charge ED on the customer when delivering the material. How to configure this process? We know the material price when inward the material.
How to in ward the material by using MM? What movement type to be used and how to keep the stock as customer stock? How to issue it to production and get it back as sales order stock? When delivering the material the stock should be reduced with 8% process loss ( Evaporation while melting)

Hi Ramesh,
Please confirm,who is having owership of stock and why does management want Product costing to be implementated?
Product costing will not too much extensively advisable for industries who is exclusive in subcontracting.
If business is expecting comparision between expenses and absorbed on service provided then go with internal order or cost center.
Hope this helps you.
Ashok

Similar Messages

Sub contract job

Hi,
Is possible to sub contract job in same company code. If possible the how it can be done .
Pl help me .

Rajesh
Create one plant as a vendor in same company code and maintain Special procurement key 30 in the material master.
Then you can do subcontracting process in the same company code
Regards
S.Anbalagan

Sub Contracting with Excise

Hi Expert,
Pls. guide me about mapping of Sub contracting with excise in SAP B1.
Thanx in advance
Regards
Kamlesh Vagal

Hi Kamlesh Vagal,
You may check these threads first:
sub-contracting
How to get work done through Sub Contracting
Job work
Thanks,
Gordon

Job Work (Reverse Scenario of Sub Contracting)

Hi Everybody,
Here is one scenario, I am sure, it will be mapped in Standard SAP, the scenario is like i am a job worker, I take the raw materials from the customer and create production order and use those raw materials supplied by the customers and charge the labour in the sales order, some times i even use some components from my stock for that also i will charge to the customer in the sales order, this is just opposite to sub contracting where i m purcahsing the labour and sending the raw materials out, this is the reverse i m taking the raw material and selling my labour, so i m basically the sub contract vendor
I want to take these material in my stock without value, at the same time i cannot create this materials as non valuated type as these material are used as valuated in other plants
If any one have any suggestion how to do in standard sap please let me know
i have one idea of vendor consignment, (Stock type K) but i m not sure how to map from sales order to production order, than take the raw materials from customer and use in the production.
If have any doubts about the scenario let me know
Thanks in advance
Edited by: Husain Husain on Feb 24, 2009 7:31 PM

Hi Everybody,
Here i have one scenario, I am sure it will be mapped in Standard SAP, the scenario is like my company does job work( Reverse subcon) for others, we take the raw materials from the customer and create production and use those raw materials supplied by the customers and charge for the processing in the sales order, some times we even add some components(Products) from my stock for that also i will charge to the customer in the sales order.
We are only billing for additional components and processing & Packing charges.
Please tell me, how can i map the scenario whether i have to create to separate sales document for selling product and processing charges. Selling product case even store issue components to products therefore no delivery.
If any one have any suggestion on how to do in standard sap please let me know.
If any doubts about the scenario please let me know.
Thanks in advance
Prashant

How to stop the Job work orders to sub contractor failed to deliver goods?

Dear friend,
If a job work vendor didn't deliver the goods in the stipulated time say 50 days this vendor to be stopped for further job work orders. Each and every order follow's the abover rule. How to configure the sap? Manual blocking not required. Automatic blocking is required.
Regards,
TS.
Edited by: tadavarty srinivas on Feb 21, 2008 6:15 AM

u nee to take help of source list but the thing is then system will not allow you to issue any type of po to this vendor
to achive this
stpe1 : activate source list at plant level(as u mentioned it has to be for all the vendors)
step 2: create a source list for all the material (externaly procured material or sub contracter)
step 3: mark the BLK check box in front of that vendor
or
JUST BLOCK THAT PARTICULAR VENDOR USING TCODE XK05

How to get work done through Sub Contracting

Hi.. guys..
my current client is in textile(Embroidery).
They get order from clent and do work. after finsihing work, if they find
some defect in fisished goods they send it for job to external party and get it done.
in short they get thier work through sub contracting.
Please let me know to main this situation i.e. inventory and production maangement
Thanks
hemant

Hi,
There is not any facility like this in B 1, but there is one work arround. I applied this at one of my client site and it is working.
Maintain A diffrent warehouse for subcontractor and transfer the defect item in subcontractor whse , when u got it back from that , do one more inventory transfer from sub contractor whse to your whse
hope this will help u
thanks
Deepak Tyagi

MTO Discrete Manufacturing with multiple plants and sub-contracting

Dear PP Gurus,
I am facing a problem, pl. help me out.
My Scenario is as follows:
I am having 4 plants with Make-To-Order Discrete Manufacturing scenarieo .
Suppose to manufacture a particular Product , there are 10 operations.The first 4 operations are carried out in Plant A, 5th and 6th carried out in Plant B, Operations 7 is Sub-contracted to a Vendor. After the job-work from Vendor, the job returns back to Plant A and the remaining operations are carried out in Plant A.
The whole scenario has to be mapped into SAP. Please guide me from the very beginning( Masterdata maintenance). Also, what shud be the MRP( Single-item multilevel or anything else)
Your help is highly required by me.
Thanks in advance,
Soumyendu

Hi Sadhukhan,
For external processing in different company code, u need to specify PP02 in the routing for external vendor. In PP02 control key indicator must be set in external opn. Before that create purchase info record. Enter subcontract info record in routing. After running MRP , convert the PR to PO. Send the material by MB1B by 541 mvt. Receive the material by MIGO by 101 mvt.
Reward if useful.
Keerthi

Sub-contracting Details like age-wise

Dear Gurus,
Client requirement as follows:
Client generally send different material to sub-contracting and will get back after job work. Now he want to analysis the pending material with vendors like each material is pending how many days at contractors. Any standar report is available for this.
One more can we analysis how much time taking for doing a job by particual vendorl. Like X vendor history on his job works.
Regards,
Venkat

Dear Viswanath,
Thax for your help. I already tired MBLB but in this date of sent is not coming.
I need report like MBLB with date of send also. So i will ask y this much time require to complete the job.
If we send same materia more than one time, i need bifercation date wise. Can we get it through Standard report.
Regards,
Venkat

Sub-contracting charges to be capitalised

Dear All,
Kindly give your input on the following,
One of my client who is manufacturing Circuit Board, this activity is done both in-house production as well as sub-contracting.
i. they are producing circuit board in In-house, as per the BOM component and costing CK11n, the price of the Circuit board will be updated in the Material master as standard price, but
some time they will give to sub-contract, (material + labour) and they want to capitalise the sub-contracting labourcharges (job work charges) to the cost of the material,
One material code with standard price and when i try to do MIGO from sub-contractor , i dont know how the system will behave
How do i do and capitalize the labour charges to the cost of material (material code is only one)
Kindly give me your valuable input which will help me to solve this issue
Thanks and regards
Elan

Thanks for your input.
Correct me if am wrong
As per your input,
if the Material Master is Standard Price "S"
I created Sub-contracting PO and when I receive the goods against the PO (MIGO), system will check the price in the material master and price in the MIGO, if any difference it will post price difference account in FI , Material master price with "S" will be remain same.
In such case, am not capitalising the job work charges to the material is it?
Kindly clarify the same
Regards
Elan

Sub contracting postings

Hi Friends,
                          While doing the subcontracting, I have got the below said postings. my problem is semifinish price is picking from material master.But it should add the rm1, rm2, jobwork chg. So please suggest
1     89     22301100     semi finish                     300          bom
2     96     18729001     vendor                     25-
3     91     41301100     chg in stksf     300-          semi finish     1. rm1
4     86     40491100     jobwork chg     25               2. rm2
5     99     22401100     stk rm 1                     2898.71-
6          40401100     consumption     2898.71
7     99     22401100     stk rm 2     10-     10-
8          40401100     consumption     10+
               mat master price
          semifinish     300
          rm1     2898.71
          rm2     10
          service charge in PO     25
Regards
sridhar.k

Hi,
In general FI postings for sub contract will be as under, if
Raw Material Value - 100/-
Job Work charges - 50/-
Semi Finished Material Value - 150/-
Service Tax - 12%
ECess - 2%
Higher Education Cess - 1%
FI Entries during MIGO
Semi Finished Stock - 150/- Debit (BSX) Posting Key - 89
Change in Stock - 150/- Credit (BSV) Posting Key - 91
GR/IR - 50/- Credit (WRX) Posting Key - 96
Job Work Charges - 50/- Debit (FRL) Posting Key - 86
Raw Material Stock - 100/- Credit (BSX) Posting Key - 99
Raw Material Consumption - 100/- Debit (GBB-VBO) Posting Key - 81
FI Entries during MIRO
Vendor - 56.18 Credit Posting Key - 31
GR/IR - 50/- Debit Posting Key - 86
Service Tax - 6/- Debit Posting Key - 40
ECess - 0.12 Debit Posting Key - 40
HECess - 0.06 Debit Posting Key - 40
Posting Keys and GL account numbers may change depends on client.
bye
Sridhar Thota

Job work senario,

I have a Job work scenario, material 999 goes to the sub contractor and comes back after processes and some more material is assembled to it , when it comes back it gets a new material no 888. how do I track the stock for 999 and which type of order do I create to job worker. or is there any other way i can handle this activity.

Hi
First In Transaction code; CS01 , Create BOM for material no :888 and in components provided list you give the material name ; 999
Then Create Subcontracting Info record in ME11
Create Sub contracting PO with Item catagory "L".... for material no:888
In PO, In Item details---->Material Data Tab--> Components Field----.>YOU can view the material which you want to send it to SC Vendor, ie) Material No:999 by default comes ....
Then save the PO
Next goto Transaction code: ME2O-----.>there you can issue the component material 999 to SC Vendor...the material will be transfered in 541 Movement type to SC Vendor...
Then after completion of the process, you can get back the new material no:888 from SC Vendor in Transaction code: MIGO in movement type 101....while you are doing GR, the component you provided to SC Vendor ,ie)Material no; 999 will be automatically consumed in 543 movement type.....
At any time,You can track the stock of 999 in Transaction codes, ME2O or MBLB or MMBE...
Hope I have clarified.
Reward if useful
Regards
S.Baskaran

Job Work Order

Hi Guru's,
Our company does job-work activity for some customer in which we need to keep track of stock - quantity received & dispatched. Hence, how it can be done by raising a service bill as we dont maintain the value for customer stock. Such job-work stock is again sent by our company for sub-contracting.
Please reply asap.
Will assign points for helpful answers.
Regards,
Abhishek
Edited by: Abhishek A on May 24, 2008 11:46 AM

Hi,
Here i explain 2 ways to handle the situation.
Method 1:
If you receive the Materials of Job-work using Goods Receipt PO and Deliver the goods using Delivery Challan after completing the Job - work, then you have to create one Warehouse namely "Job Work WareHouse". For this warehouse you should should assign the G/L Accounts in Accounting tab.
Create seperate accounts for capturing the cost of job work. You map the G/L Accounts which you have created for Job work process in "Job Work WareHouse" --> Accounting tab.
When to send the Goods to party you should generate A/R invoices for Items and Service seperately.(ie., Item/Service Type : Items for Items and Item/Service Type : Service for Service bills)
If you use this method you should be careful when mapping the G/L Accounts. The Stock will also be updated along with price.
Method 2 :
You receive the materials from party using "Goods Receipt" (ie., Inventory --> Inventory Transfer --> Goods Receipt). While recieving select the "Job Work Warehouse" and stock the materials in this warehouse. After performing the Job Work again transfer the Stock to the same warehouse or you create another warehouse and maintain Job work finished stock seperately. While sending the materials to party generate the "Goods Issue" (ie., Inventory --> Inventory Transfer --> Goods Issue).
For generating the Service bill use A/R Invoice (Item/Service Type : Service for Service bills).
I hope this could help you.
Raja.S

Job worker billing analysis and verification through stock transfer note

Dear All,
We give all the material to your job work location and then we get the material packed by our job worker and then we give our job worker packing charges as per the following:
1. Sulphuric Acid 5 L = Rs.10/- per unit
2. Nitric Acid 25L = Rs.50/- per unit.
Like this.
So tell me how should i maintain the job work charges against each FG for the job work, so that at the end of month i can download their monthly bill report through dispatches which they have made between that period.
Kindly also tell me the code which i should use to check their monthly job work bills through dispatch done through stock transfer note.
Regards,
Phalgun Patel

Hi Phalgun,
Mr. Muhammad is right. You have to use Subcontracting process for your requirement.
Just go through below link which gives you standard SAP Subcontracting process with configuration.
http://help.sap.com/bp_bl603/BBLibrary/HTML/138_EN_IN.htm
And also some other links as below.
http://www.sap-img.com/materials/sub-contracting-cycle.htm
http://www.sap-img.com/materials/subcontracting-key-points.htm
http://www.sap-img.com/materials/what-is-subsequent-adjustment-in-process-of-subcontracting.htm
Please check and revert if you have further queries.
Regards,
Hiren Ramani

Very imp job work order

hi friends ,
please let me know whats the difference between job work order and purchasing sub contract order.
thank u in advance.

Hi,
JOB ORDER
A job order is an internal document extensively used by projects-based, manufacturing, building and fabrication businesses. A job order may be for products and/or services. In a manufacturing environment, a job order is used to signal the start of a manufacturing process and will most probably be linked to a bill of material. Hence, the job order will probably state :-
(a) the quantity of the product to be manufactured, built or fabricated
(b) the amount of raw material to be used, its price and amount
(c) the types of labour required, rate (per hour or per unit) and amount
(d) the machine utilisation for each machine during the routing process, its rate and amount
common concept of a subcontractor is in building works and civil engineering, the range of opportunities for subcontractor is much wider and it is possible that the greatest number now operate in the information technology and information sectors of business.
The incentive to hire subcontractors is either to reduce costs or to mitigate project risks. In this way the general contractor receives the same or better service than the general contractor could have provided by itself, at lower overall risk. Many subcontractors do work for the same companies rather than different ones. This allows subcontractors to further specialize their skills.
Regards,
Deepak.

Clarification on job work

Dear friends
The company is A. Plant B and Plant C is attached to Company A.
Plant B Making part and giving job work(Powder coating) to plant C. How it is done in SAP . Is it tru stock transfer or Sub contracting. what are all the setting done. how the profit calculated for plant B and C. Please explaing the procedure and configurations setting neded for the same
Rgds
Madhavan

hi,
You need to make the plant as a vendor for the getting the job work done...here you shd use the subcontracting process...and use the normal subcontracting process only..
Regards
Priyanka.P

Sub-contracting job work

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