Subcontracting material

HI MM GURUS,
HERE i AM FACING A PROBLEM
MATERIAL IS SENT TO SUPPLIER WITH MOVEMENT TYPE 541
AND BY MISTAKE OF GR MAKER , DURING MIGO HE DID ONLY GR WITH MOVEMENT TYPE 101, NOT 543.
DUE TO THIS STOCK AT SUPPLIER IS NOT CONSUMED, WHAT IS THE WAY TO TAKE OUR STOCK BACK.
IS SUBSEQUENT ADJUSTM,ENT WITH RESPECT TO PURCHASING DUCUMENT IS CORRECT WAY?????
WITH REGARDS
NAGARJUN

Hi Nagarjuna Reddy
Your colleigue might have done goods receipt with zero quantities of components.
In goods receipt screen, you will find posting lines for parent material and components. The qty of components have been calculated by the system w.r.t parent material receipt qty and the composition in subcontracting order.
So, by making goods receipt with zero quantities of componenets, your parent material is valuated with conversion charge only and not with components, obviously your components remained at subcontractor.
So, now you can do over-consumption (subsequent adjustment) of the components against the same receipt to match the valuation and ensure consumption of components. The net effect is same. Hence you can proceed with.
warm regards
sairam akundi

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Moving average price of subcontracted material not picked for Cost estimation

Hi Experts
I have the below scenario:
Finshed Product A has components B, C.
C is a subcontacted material and it has its own BOM with components D & E.
We are maintaining moving average price for the subcontracted material C, (because the subcontracter is adding X & Y in addtion to the components D and E, which are sent from us).
In the mateial maste of C, Procurement type is F and Spl. procurement type 30 are maintained.
When i do costing for the Finished product A, moving average price of C is not picked up (where as system calculates the std cost for C by adding the values of D & E and purchase info record price).
Is there any way to Calculate Price of A by using the mvg avg price of C.
I maintained the below valuation variant settings.
If i remove the spl. procurement type 30 in the material master of C, it picks up the mvg. avg price. but it affects the MRP planning of items D & E.
Please advice.
Thanks in advance.
Regards
Bala

Hi Big choi
Thanks for your response.
I understand.
1. if we maintain spl. procureent key 30, system calculates standard cost based on raw material and service charges.
2. If we don't maintain spl. proc key, it considers the material as purchased and picks the mvg avg price from material.
But, is there any way to pick the moving avg price from material master eventhough i maintained the spl. procurement type 30?
Thanks
Bala

Goods receipt for subcontracting material

Hello friends,
i am doing operation subcontractiing. My first operation is subcontracted. So, I have assigned PP02 control key to first operation (external processing and no auto goods receipt indicator) and maintained external processing data for opration in routing. When i saved the order, for that operation PR gets generated.
Now, I converted PR into PO and assigned raw material that has to be send to vendor. By 541 mvt. type material is issued to vendor. When i do goods receipt in MIGO, system is not showing storage location field. I dont find material in stock anywhere.
But i can see quantity received in external processing tab of first operation in routing overveiw in order.
Then how can i issue the material from storage for second operation if it is not in stock?
How can i get stock of subcontracted material by MIGO?
Please help me.
Thanks in advance!

Kiran,
Since your scenario is Subcontract of operations, you will not find a material referance in your PR/PO, so there is no GR of Material happening, in this Scenario GR means delivery of the operation.
If you really want to track, then you need to create an additional material number and assign that material number with Special Procurement key "30", here in this case you can recieve the product after subcontract as this is product sub contract process. In this case Production order is not relevant.
Regards,
Prasobh

Subcontracting material in Blocked QI stock

Hi all-
We have some material that we subcontract out and the material has QI inspect required on it. The material was received into a subcontractor and we are now having a bit of an issue getting it out of QI/blocked stock.
I am not seeing an inspection lot for the material that we can release, nor can I cancel the receipt of the material, and I am unable to do a transfer posting from block to unrestricted since I do not have a storage location. Can I get some guidance on what I may be missing?
Thxs.
Larry

hi,
You are doing the subcontracting process totally wrong....this is because for VENDOR Subcontractor we have only Unrestricted stock type to which you post via 541....
The reason for having one stock type is because the reason you have given above....Ie. it has no storage location...
So, that's the reason we valuated the subcontracting material at plant level only....
Now you should try to cancel the posting...and try to make the new one...
I hope you understand the reason....
Regards
Priyanka.P

Returnable transport packaging for Subcontracting material

Dear All,
I have a doubt regarding a new process to be followed in our company. We need to issue raw material to our subcontractor for processing. We also intend to send packaging material to the subcontractor along with the raw material. Ie We are sending the raw material to the subcontractor along with the packaging material ( say, in boxes).
I would like to know how to address this issue.
What We tried
Standard SAP is allowing the vendor's Packaging material to be "received" from the vendor when we Purchase material from the vendor using movement type 501 'M'. After this, we are able to see this as a "special stock" as RTP ( Returnable Transport Packaging ) in T code MMBE. After this we can issue the packaging material back to the vendor using movement type 502 'M' . There is also a provision to send " our" packaging material to a customer through a Sale order, and receive it back from them.
But is there any standard process for sending "our" packaging to a subcontractor and receiving it back from them ?
We also tried including the packaging material in BOM, and sending it through 541 movement but in this case, when we perform Goods receipt ( 101 movement of the parent material ), the packaging material gets consumed, which should not happen. We want them back in stock.
We also tried using the option "Non - Ordered item" for the packaging material while performing Goods Receipt of the parent material. But this would increase the stock of the packaging material without us even issuing the same to the vendor initially. ie More stock will be there than is actually present.
So how else do we address this issue ?
Regards,
Velu

Hi Velu,
This scenario can be automated as well in BOM.
While maintaining the BOM for the subcontracting material, include the packaging component as twice, but one with negative quantity. PFB screen shot.
Also turn of the costing relevancy indicator and maintain material provision indicator as "K"(customer material) for both the line item.
So while doing GR for the sub contracting, system post automatically 543 and 545. Hope this is useful, if it is so, your rewards are awaited .
Regards,
Chinna

Scheduling agreement with Subcontracted material

Hello Gurus,
There is scheduling agreement with subcontracted material.
While maintaining the schdule with ME38 , I want to make the warning message of "Please create components" ME114 as error message. I went into configuration and set this message as " E" . But still while maintaining the schdule with ME38 , I am getting this message as Warning only and not error message.
I would like to know is there any other setting other what i did?
Please help me
Thanks in advance

Thank you for your reply.
By going into the T code OBMSG , and doing the needful config., still result is not achieved.
Please guide

Subcontract material

Hi Experts,
Please tell me following.
1. In costing variant --- Valuation variant -
Overhead , there is check box for Overhead on subcontracted material
I want to know what & where do I get its effect if I mark or unmark this check box.
2. I have fully processed on process order till GR,in which I did not issue extra raw material quantity. Status of order now is REL CNF DLV PRC BASC BCRQ GMPS MACM . where I found Total target cost for component is 1040.70 & Total actual cost 1041.00
& Target/Actual varience is 0.30. Why system showing this variances as I issued only planned quantity.
Regards,

Hi,
Pasting SAP help, guess it is quite descriptive & should answer your query, else revert.
Regards,
Vivek
Overhead on Subcontracted Materials
Indicator specifying whether, in respect of materials subject to subcontracting, overhead is applied in accordance with the costing sheet in the valuation variant.
Use
Set this indicator if you want to apply overhead to subcontracted materials (for example, to include material and administrative overhead).
Note
The application of overhead to subcontracted materials is included in material costing as well in unit costing on a manual basis for any subcontracting items entered.
Dependencies
When a material cost estimate is transferred to a unit cost estimate, items are flagged as Do not apply overhead if the indicator is not set in the valuation variant of the receiving object.

Subcontracting material valuation

Hello,
Is it possible to mark labour costs on a subcontracting Material as cost not relevant during costing valuation on a per material basis? We would like to implement subcontracting, but keep the ability to mark the labour as cost not relevant for some materials.
Any suggestions appreciated.
M

Hi
Welcome to SDN!
Lab cost relevant or not is decided at Cost Comp Structure Level in OKTZ... This applies to the Plant / Comp Code as a whole
This cant be controlled at Material level
Sorry that I could not offer you a +ve reply on your 1st post.. But thats the correct answer
br, Ajay M

Subcontracting Material MRP.

Hi friends,
Here is my issue,
We have a material 'A' which is a subcontracting material and its subrequired material is 'B'.
when we run MRP (MD04) for the material 'A', here it generating the PR's as required. but when we run
the same for material 'B' it is generating the Planned orders (pldOrd). but this material is not in-house
produced one..
Why it is generating the pldOrd for the material B
Please explain why it is happening and how it should be corrected.
Regards,
Mohan.

Hi,
Check the below settings
1. For Matrl A Ensure the MRP2 , Procurement key is F and spl.proc.key is 30
2.For Matrl B ensure the MRP2 has the Proc key F if you are buying this product externally
Hope you would have maintained BOM as Matrl A header and Matrl B as lower material
3. If you need PR to be generated, Put MRP relevant indicator as '1' in source list by giving proper vendor
4. If you need Sch lines to be created,enter the Sch.agrmnt # in the source list and give MRP relevant
5.Run the MRP for Matrl A in MD03,give the below MRP Control Parameters
           Processing Key NETCH
           Create Pur req    1
           Delivery Sch       3
           Create MRP       1
           Planning mode   3
           Scheduling         2
6.By this MRP run,the lower level material also will get run automatically.
7. If not,run MD02 with the above MRP control parameters 1,3,1,3,2

Report for subcontracting material

Dear all,
I need your help.
we have two plants suppose plant 1 and 2
plant 1 have sent some material to plant 2 by subcontracting challan
so i need a detail like
1) material sent via 57f4
2) input material (raw material)
3) output material (finish material after subcontracting)
4) vendor
5) price, qty
is there is any report like this....

Hi
Go to J1ILN > Indirect taxes > procurement > subcontracting > reports > chalan Listing.
This may be of your help. beyond this you will have to develop client specific report.
Best Regards
Nishant Shende

Rejection of subcontract material to vendor without return of material.

Dear friends,
There are some subcontracted (semi finished) parts kept with us which were received from Subcontractor after their process. As usual at the time of GR, the raw material sent to them were consumed at our end and relavent labour charges were paid to them towards this.
Later it is found that the parts are faulty and decided to reject the same to the Subcontractor.
1. We like to scrap the semi finished material at our end which will be later sold to external customer. For this stock of the scrap material to be maintained. (The scrap material is maintained in another material number and also it is in kg which is different than the semi finished material).
2. The value of the rejected semi finished good after deducting the scrap value has to be debited to Vendor account.
3. The labour charges also to be debited to the vendor account. (Can this be posted by subsequent credit?)
Friends, is there any solution to this issue. Please guide.
Thanks
Harikrishnan.

1. We like to scrap the semi finished material at our end which will be later sold to external customer. For this stock of the scrap material to be maintained. (The scrap material is maintained in another material number and also it is in kg which is different than the semi finished material).
After making the GR complete the cycle upto invoice verification and book the total labour charges.After that you scrap the semifinish material with movemen type 551.Then make a copy of movement type 561 say z61 after that upload the stock with scrap codes with Z61 and sell it.
*2. The value of the rejected semi finished good after deducting the scrap value has to be debited to Vendor account.
Pass the subsequent Credit in invoice verification for rejected semifinish scrap value.
I hope this way you can work out your requirement
Regards
Vivek Sharma

Setting for issue subcontract material with ME2O

Hi,
In our system presently we are issueing all the material to subcontract with MB1B movement type 541, I wan tto knowthe settings and process of issue the material with ME2O, what settings are needed this is to control some that we can see the issue qunaity against that PO to the vendor.
regards,
zafar

Hi,
I have created a Subcontract PO now in ME2O I can see that POthen I select the PO number and click on Post goods issue, but system is giving error message
Please select header line(s) or reservation(s)
Message no. ME152
but which is the this header line or reservation i have not found reservation number in ME2O screen in our system.
regards,
zafar

Valuation type need to maintain for Subcontracting material FG

Hi,
i have a scenario like plant A is subcontracting SFG to Plant B and receiving FG to Plant A from Plant B.
i have maintain this as V valuation type.
when i am doing billing in Plant A for this product i am getting error like no cost estimate found for product.
As it is "V" and it has BOM and it has price in it.
And i have maintain in KEPC setting aganist this material type against this plant.
if i remove this setting probelm can be solved
but this plant has got some other FG products which are produced in house so we do costing run for it.
is there any solution for this material type that can allow billing with "V" price also with out making changes in KEPC.
thanks
kareem

HI Ajay anna,
thanks for ur reply
do i need to assign same costing key for the product in KE4H .
or do i need to create new costing for it.
please can you tell me what i need to select if i need to create new costing key for those they dont have cost estimate.
Like Period indicator,
costing date.
waiting for ur reply anna.
thanks
kareem

Subcontracting material directly to subcontracting vendor

hi all
i created BOM in cs01 for material suppose m for three child materials .these components i procure from a regular vendorA. and give it for subcontracting to vendor C. i am creating a PO in this at item tab delivery address is of subcontracting vendorC ,SC vend field is ticked and PO is given to vendor A. now when i want to do GR for this material i am getting error that "MATERIAL DATA AND PO DATA DO NOT MATCH"
any help

thanks i got the answer it can be planned via mrp

Individual purchase order with subcontracting material

Hi all,
I've implemented a individual purchase order in a sale order by means of 'TAB' category item. The material has been set as 'subcontracting'.
When I create the sale order, a purchase requisition is automatically created with M imputation and special stock 'E'.
Once I create, the purchase order with reference to purchase requisition, I set 'L' category item. Then I save the purchase order.
In order to simplify the flowchart, the vendor has enough stock to manufacture the required material.
Then, Tx. MIGO, stock input with reference to purchase order.
For the FERT material --> movement 101 E + is set.
For the component --> movement 121 E - is set.
How can I obtain 121 'O' - movement for components in order to decrease SC vendor stock?
Thank you very much in advance for your support.
Best regards,
Alberto Ramos.

Dear Charlie,
Thank you very much for your response. As you comment, I made a mistake with the number of movement. Certainly the movement for raw material consumption is 543.
I have executed the flowchart you describe. In your case, an independent subcontracting purchase order is done. This flowchart works correctly (with the results you comment. Actually the raw consumption are related to mov. 543 O -).
The problem is when purchse order is related to a sales order. That is:
1. Sale order TA with only one position material A. Category item 'TAB'.
2. Material master for material A --> MRP 2 view --> Special procurement field: 30 - Subcontracting
3. An automatic purchase requisition is created (thanks to 'TAB' category item, schedule line, ...)
4. Tx. ME21N --> I create a purchase order with reference purchase requisition:
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    4.2. I manually set Item category field to 'L' for indicating subcontracting (I don't force this to be 'L' from sales order / purchase requisition because I need to use the same flowchart for subcontracting and not subcontracting materials)
5. Tx. MIGO
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    5.2. For raw materials the system exectures mov. 543 E - ( instead of 543 O -). I would like to obtain the reduction of subcontracting stock, because this material is in my center but povided to SC manufacturer.
Should I do a 'Subsequent adjustment' by means of Tx. MIGO the movement are:
- FERT material 121 E - (depending on adjustment)
- Raw materials 543 E - (again 'E' instead of 'O' which is the result I would like to obtain).
I will very much appreciate your comments.
Thank you again,

Subcontracting material

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