Subcontracting Processing charge Issue.

Dear All,
With regards to one of my subcontracting scenario, I would like to post the following issue.
We have one finished Material "D" for making D we provide the component "A".Subcon vendor process their side A to B, B to C and C to D.Finally we got the product D from subcon vendor with the Processing charge Rs.6.00 (each activity having Rs.2.00). In some cases we provide Component B or C (In house produced) to subcon vendor directly to make finished product "D".For that we only charge either Rs.4.00 (from B to D) or Rs.2.00 (from C to D).
But here we found the problem that all the activity price coming from Inforecord (Subcon) only and in Inforecod I can only maintain one price.So kindly help me to address this issue ??
Regards
AKS

Hi AKS,
You can do it in two ways.
1. You can maintain the BOM for the finished material with A B C and explode the BOM when you are providing all the materials to the SC vendor. In PO you are mentioning the price against D (FG) only and you have the option to enter the price of your choice depending on which components you are providing.
2. You can do it without BOM, and in PO you should mention only those components being provided to the SC vendor and enter the charges as said above.
You should maintain two PIRs, 1 with all the components and the other with limited components.
Hope it helps
Revert if needed..
Regards
Shiva

Similar Messages

Error while releasing Billing document in Subcontract process

Hi All,
We are working on Subcontract process as explained below:
Company code X purchases the component A and sends it to Company code Y on Subcontract. Company codes X and Y belongs to one company using single operative chart of Accounts, Controlling area & operating concern. FI configuration has been maintained in OBYA by treating above company codes Inter company GLs. The component A is sent to company code Y as non value added item. Through 501 movement type, as the component is sent by Company code X.
Company code Y will add some components (like B,C and charges some expenses as service component D for preparing Finished good) and send this FG to Company code X. For this company code Y will raise a Sales order and followed by MRP run and Production order is created.
In VA02 of above Sales Order, while entering Item details, where the Settlement rule is asking for PA Transfer structure (in Account assignment tab of Item details) and giving the following error analysis:
Enter a PA transfer structure
Message no. KD 044
Diagnosis
A PA transfer structure is required for settlement to profitability analysis.
System Response
You cannot save this settlement rule.
Procedure
Enter a PA transfer structure. To do this, choose the "Parameters" function in the settlement rule. As part of customizing, you can also store a default value for the PA analysis structure, in the settlement profile. The system then uses this default value when you enter a settlement rule.
In addition to above, another issue has raised while releasing the Billing document after doing PGI. Accounting document is not getting generated and while releasing the Billing document (VF02) it is throwing an error as
Enter profitability segment as cost object for Revenue and COGS posting
Message no. ZC 001.
MM,PP,SD & FICO configuration settings maintained:
1. All required OBYC settings
2. All cost element and Cost element categories have been maintained
3. From MM side the system is generating FI & CO documents
4. Settlement profile in Production Order type is maintained (in KOT2). Allocation structure and PA transfer structure were maintained in (OK06, OK07 & KEI1). In PA transfer structure we have assigned the required Sources and Value fields and settlement cost elements.
5. In VKOA condition types KOFI and KOFK were maintained for relevant Customer & Material Account Assignment groups.
6. Required settings have maintained in OKB9.
Movement types 501 (sub contract), Received back to Company code X through Movement type 101. In spite of these settings still we are getting the above mentioned errors.
Could any one help to provide some inputs on the above issue as early as possible.
Thanks in advance.

Hi,
check in the sales order line item procurement tab . u can get the requirement type. in SPRo check the requiremnt class for the requirement type. in that requirement clas u will get settrlemnt profile for the sales order. Check that settlemnt profile there u have to maintain the PA transfer structure.
I think both problem will get solved by maintaing the PA structure..
You are doing sales order costing right....and i hope it is non vsaluated sales order costing .....
If help ful please assign points.
cheers
Prabhat

Steps in Subcontracting Process

Dear Experts,
In Subcontracting process if the subcontracting period of 180 days is completed and if material is still with Vendor, how to complete the process.
Also how to reverse the Cenvat Credit.And how cmplete/reconcile the challan.
Please explain detail steps and Tcode.
Thanks and Regards,
Sapmm user

Sub Contracting Cycle
(1) You have a material that can be procured externally, and you have maintained BOM with components. Any waste generated and received during subcontracting process can be maintained as component with negative quantity.
(2) You create a subcontracting PO (PO with Item Category L). You can also maintain Purchase Info Record for Subcontract category for material and subcontractor.
(3) You make a transfer posting to issue components for SC PO. Material is sent to subcontractor. As material remains under your ownership, system does not make any value entry. But quantity is shown as "Material Provided to Vendor"
(4) You receive finished material against SC-PO. You also specify components consumed in manufacturing of finished goods. Additionally, if you have negative components in BOM, now you'll also receive subcontracting by-products. There are three events, so three accounting entries are generated:
DR FG Stock/ SC By-Product Stock
CR Change in Stock (FG/ SC By-Product )
(for finished goods received)
DR Subcontracting Charges
CR GR/IR Clg
(for moneys payable to Subcontractor)
DR Consumption (Components)
CR Change in Stock (FG/ SC By-Product ) 0
(material provided to Vendor is now charged to expense)
(5) You do the IV for SC Invoice, and the process is complete.
Process of Subcontract in MM
Sub-contract business process:
You want to buy material from the supplier (processed material/ assembled item) , but for some reason (quality of certain item / price ) you will give some component to vendor .
Vendor shall process the item / use the item provided & supply the final item.
SAP process:
1.Create the finished goods material code.
2.Maintain the BOM for the material.
3.Create PO with item category as "L" .
4.Issue material to vendor with movement type 541
5.Receive the material against the PO with movement type 101.
6.MIRO to account for vendor's invoice for the service charge& material used by him.
Note:: At the Time of GR 543 Mvt is up dated for Raw Material.
Can anybody tell me how a process has to be given to subcontracting?
Suppose, I have 3 operations 1)weaving 2)dyeing 3)cutting & packing
if no 2 process (i.e Dyeing) has to be given to subcontracting, what process should i follow ?
The following process to be followed for subcontracting.
1. Item code(material master) to be created at the stage of before dyeing.
2. Item code(material master) to be created after Dyeing as subcontracted item.(F30)
3. Bill of material to be created for the material(2) calling for material(1)
4. Info record and source list to be created for material(2) with the corresponding vendor
5. PO to be released for material (2)
6.Along with PO the material(1) to be issued to vendor
7.On receipt of material when GR is made the stock with vendor will get updated.
How to Create a Subcontract Order?
To create a subcontract order, proceed as follows:
Enter the material you want to order and the item category for subcontracting (L) in the order item.
Press ENTER to display the screen for component processing.
Enter the components that the vendor requires to manufacture the product.
Please note:
u2013 You do not need to enter the date required for the components. This date is proposed by the system when you press ENTER.
It is calculated as follows:
Delivery date of the item - Planned delivery time
u2013 If you do not want the quantity of the components to be changed if the order quantity of the end product is altered, set the indicator Fixed quantity (column F).
u2013 You can determine whether the components are available on the date required by selecting Edit -> Availability check.
If you entered a bill of material as the material in the subcontract order, the components are created automatically.
If you want to determine the components in the bill of material at a later date (for example, if the bill of material is subsequently changed), choose Item -> Component -> New BOM explosion. The existing components are deleted and redetermined in the bill of material.
Save the purchase order.

Subcontract Process in MM

Hi All,
I have to map the following scenario in SAP.
There are three materials A, B & C.
We send material B to the vendor.
Vendor purchases material C.
Vendor adds material B to material C and sends us material A.
We pay vendor for material C and labour charges.
Now I want to achieve the above process by using the subcontracting process in SAP. I maintained a BOM for material A with material B as the component.Price of material A in PO = service charges for producing A + cost of matrl B. I could run the process this way.
But my client wants to have material C also in the BOM (even though they do not purchase the same).They say they want it for costing of material A. So material C must be in the BOM with matrl B.
So is it possible to have two seperate BOM's for material A , one for costing(matrl B + matrl C) and the other for using in the subcontract process (only matrl B)? And if we can have it that way how do I ensure that the BOM which contains only Matrl B gets selected when I create a subcontract PO?
Any help would be really appreciated.
Regards,
V S

Hi:
It is possible to have the two separate BOM one is costing BOM and other is your regular production BOM.
However while creating these two BOM select BOM Usage as 6 for costing BOM and 1 for production BOM so in subcontract PO system always select production BOM which must be having only one child component which you wanted to issue.
And ask you controlling to use costing BOM for the costing purposes which would have two child components.In controlling there is a provision to proritise the BOM usage.
Hope this would helps you.
Cheers
Rahul.
Awards plz. if helpful.

Subcontracting Process

Hi
If any one can explain in detail about scenario material vendor posting directly to subcontracting vendor
It 's very urgent
Thanks & Regards,
Sadhish

Hi Sadhish,
Sub Contracting Cycle
(1) You have a material that can be procured externally, and you have maintained BOM with components. Any waste generated and received during subcontracting process can be maintained as component with negative quantity.
(2) You create a subcontracting PO (PO with Item Category L). You can also maintain Purchase Info Record for Subcontract category for material and subcontractor.
(3) You make a transfer posting to issue components for SC PO. Material is sent to subcontractor. As material remains under your ownership, system does not make any value entry. But quantity is shown as "Material Provided to Vendor"
(4) You receive finished material against SC-PO. You also specify components consumed in manufacturing of finished goods. Additionally, if you have negative components in BOM, now you'll also receive subcontracting by-products. There are three events, so three accounting entries are generated:
DR FG Stock/ SC By-Product Stock
CR Change in Stock (FG/ SC By-Product )
(for finished goods received)
DR Subcontracting Charges
CR GR/IR Clg
(for moneys payable to Subcontractor)
DR Consumption (Components)
CR Change in Stock (FG/ SC By-Product )
(material provided to Vendor is now charged to expense)
(5) You do the IV for SC Invoice, and the process is complete.
Process of Subcontract in MM
Sub-contract business process:
You want to buy material from the supplier (processed material/ assembled item) , but for some reason (quality of certain item / price ) you will give some component to vendor .
Vendor shall process the item / use the item provided & supply the final item.
SAP process:
1.Create the finished goods material code.
2.Maintain the BOM for the material.
3.Create PO with item category as "L" .
4.Issue material to vendor with movement type 541
5.Receive the material against the PO with movement type 101.
6.MIRO to account for vendor's invoice for the service charge& material used by him.
Can anybody tell me how a process has to be given to subcontracting?
Suppose, I have 3 operations 1)weaving 2)dyeing 3)cutting & packing
if no 2 process (i.e Dyeing) has to be given to subcontracting, what process should i follow ?
The following process to be followed for subcontracting.
1. Item code(material master) to be created at the stage of before dyeing.
2. Item code(material master) to be created after Dyeing as subcontracted item.(F30)
3. Bill of material to becreated for the material(2) calling for material(1)
4. Inforecord and source list to be created for material(2) with the corresponding vendor
5. PO to be released for material (2)
6.Along with PO the material(1) to be issued to vendor
7.On receipt of material when GR is made the stock with vendor will get updated.
How to Create a Subcontract Order?
To create a subcontract order, proceed as follows:
Enter the material you want to order and the item category for subcontracting (L) in the order item.
Press ENTER to display the screen for component processing.
Enter the components that the vendor requires to manufacture the product.
Please note:
You do not need to enter the date required for the components. This date is proposed by the system when you press ENTER.
It is calculated as follows:
Delivery date of the item - Planned delivery time
If you do not want the quantity of the components to be changed if the order quantity of the end product is altered, set the indicator Fixed quantity (column F).
You can determine whether the components are available on the date required by selecting Edit -> Availability check.
If you entered a bill of material as the material in the subcontract order, the components are created automatically.
If you want to determine the components in the bill of material at a later date (for example, if the bill of material is subsequently changed), choose Item -> Component -> New BOM explosion. The existing components are deleted and redetermined in the bill of material.
Save the purchase order.
When you print the purchase order, the components are printed per order item
Subcontracting - Key Points
Special Procurement Process.
Item category: L
Order type: NB
In info record vendor should be maintained as subcontractor.
Vendor (Subcontractor) receives the components used to manufacture a finished product directly from your company or through third party.
Your company should place a purchase order for the finished product. In this manually you can enter the required individual components or it can be determined via the explosion of BOM (if exists).
Stock check at vendor level: ME2O
Company stock check: MMBE
GR for individual components through movement type: 501 or 561 (if with out PO or without reference).
GI to subcontracting vendor: through movement type 541.
GR from sub contracting vendor: through movement type: 101
Movement type 543 is displayed to cancel the material cost account.
If the subcontracting order has to be generated through materials planning,the special procurement key has to be set in MRP 2 screen.
- To create the Subcon Info Record : Tcode ME11 - Info Category - Click Subcontracting
- To create Material BOM : Tcode CS01
- With the Info and Material Setup, you can then create the Purchase Order in Tcode ME21N
Hope it wud have answered ur question
Reward if useful
Aasif

Intercompany - Subcontracting Process

Hi
We have a subcontracting process where RM/PM is issued by Parent company and other company charges processing fees and sends back FG to parent company.
So this is typically a subcontracting process in SAP where one company sends the material to vendor( 2nd company ) and vendor processes the goods for 1st company and charges processing fees. In 1st company stock will be reflected as stock with vendor and in vendor books (2nd company), this stock will be not appear.
Both the companies are on SAP and using same client.
Now our requirement is as under -
1. Parent Company needs Inventory tracking which is being issued to Vendor for their materials ( because both the companies are on SAP )
2. Vendor needs to generate an invoice for processing fees with following details:
1. Material Produced
2. Quantity produced
3. Batch details
This is legal requirement where Invoice should capture Processing charges details at the time of dispatch..
Kindly advice how this scenario can be mapped with above details. Issues which we are facing are :
1. If we use simple sub contracting process, material tracking is not possible in Parent Company
2. When material is issued to Vendor (Company Code 2), How to receive/dispatch FG material in Vendor so that complete processing in PP can be mapped.
thanks,
Manoj

There is no restrication that Automatic PO will not be created if the PR is created from the Sales Order.
Please elobarate on the exact error you are getting.
However please follow & check if these general settings are in place.
1.Material has the auto PO checked in Material Master.
2. Vendor has the Auto PO checked in Vendor Master.
3.Source list is maintained if material master has source list checked.
4.Valid conditions exist in the Sub Contracting info record.
5.Right variant ex - doctype,Plant etc exist or are entered in ME59N.

Serial numbers for subcontracting process

Hello Experts,
We are using SAP ECC 6.0 and trying to implement the subcontracting process with serial numbers. This scenario is focused on those materials that we need to keep track on how many times it has gone to repair (for example, a motor) by specific item. Suppose there's a material called "Material A". However, there are MANY "Motor A"'s, and thus, the need for serial number to keep track on the number of repairs each one has had.
So, having said that, the scenario is working so far. However, the user CAN'T type in the serial number of the material at the REQUISITION LEVEL. This can be done at the PO level and at the goods receipt level.
This brings a problem since the Purchasing dept. doesn't know the serial number. This information is known by the user, but there's "serial number" functionality in the requisition. Is there a configuration for this? Could it be possible for the serial number to be in the requisition and then inherit it to the PO?
We want this in order to automate the process.
The configuration we made was in the "Plant Maintenance and Customer Service" section, using procedures MMSL "Maintain goods receipt and issue doc." and POSL "Serial numbers in purchase orders". There's no procedure for purchase requisitions. If this can be also done from a Work Order, that will be just fine.
Let me know if it is possible or if you have any idea on how to do this.
Regards,
Gilberto Gallardo.

Hi,
Serial no can be used for the following business transactions.
1. Goods Receipt/Goods isssue and other inventory postings.
2.sales orders and delivery notes
3.maintenance orders
4.production orders.
Settings:
1. create a serial number profile in customising.
2. Assign the serial number profile in the material master record in work
scheduling view for fert and raw material in plant data / stor2 view..
Business procedures may be assigned in configuration to a serial number profile.
The assignment to the serial number profile determines if serial numbers are required , can be assigned, must be assigned,are assigned automatically
MMSL : Goods issue , receipts,stockj transfers,stock transport orders
Thanks
nandha

G/L accounts updation in subcontracting process

Hi,
i request you provide details of G/L accounts while ;1) updation while we supply materials to vendor
2) while we recieve the finshed product.3) And while settlement to vendor.
Thanks & Regards,
Ramesh kumar.

Hi,
If Material has Price Control as "V" (MAP)
(BSX) Stock A/c of Assembly - Dr
(BSV) Change in Subcon Stock - Cr
(FRL) Subcontracting Charges - Dr
(WRX) GR/IR Clearing A/c - Cr
(BSX) Stock A/c of Components - Cr
(GBB-VBO) Consumption A/c of Components - Dr
If Material has Price Control as "S" (Std. Price)
If Material is having Price Control as "S" then Price Difference A/c will also in picture.
This depends on configuration; SPRO > MM > Inventory Management and Physical Inventory > Goods Receipt > Price Differences for Subcontract Orders at Goods Receipt
Price Differences for Subcontract Orders at Goods Receipt
In this step, you configure for each valuation area whether price differences are generated for a Subcontract order at the time of a goods receipt if the manufactured material is managed at standard price and the standard price varies from the receipt value (externally performed service + value of components + delivery costs).
Example
Finished product: $400 (value at standard price)
Subcontract order:
o Ext. service : $250
o Components : $100
Posting schema without price differences:
Stock account FERT : 400 +
Stock change : 400 -
GR/IR clearing acct : 250 -
External service acct : 250 +
Compon. stock account : 100 -
Consumption account : 100 +
Posting schema with price differences:
Stock account FERT : 400 +
Stock change : 350 -
Price difference : 50 -
GR/IR clearing acct : 250 -
External service acct : 250 +
Compon. stock account : 100 -
Consumption account : 100 +
And cost center is mandatory for subcontracting process
the accounts for the BSX FRL and GBB-VOB needs the cost elements
Sometimes if you have freight the key FRN also gets used.
Edited by: venkatesh kumar on May 11, 2010 12:46 PM

Overhead on Subcontract Vendor Charge

We have implemented Raw Material Costing, adding overhead through use of a costing sheet.
We use subcontracting (PrcTypF/SpcPrcTyp 30). In most plants it is a minor portion of the cost, so we did not need to know how to add overhead to the vendor charge
At One of the plants that we are converting now to Raw Material costing, the Subcontract vendor charge is 80 - 90% of the value. We need overhead added to that charge.
I thought I could just check the box in the valuation variant for Overhead on Subcontract Materials and it would calculate.
It did not..
I did add the subcontract cost element to the BASE on the costing sheet.
What else do I need to do to get the overhead
thank you
Althea

Have you specified OH costing sheet under the tab overhead? This costing sheet needs to be specified for the Finished/semi finished field.
Please check if you can see the OH sheet under the valuation tab. Also check if the cost element in OH costing base is showing in itemization.
I think it is a OH costing sheet issue and not subcontracted material issue.
Sanjay Wagh

Excise treatment during subcontracting process with excise duty

Dear all,
Iam aware of the subcontracting process STEPS, but my query is while dealing with Excise in Subcontracting process, will the Excise duties captured in J1IS(create outgoing excise invoice) be RECONCILED with excise duties captured in J1IEX(subcontractor's excise invoice). As per my scenario both the duties are different unlike reconciliation process in the process without excise duty. My questions are
1.Do both excise duties during j1is and j1iex should be same or can it be different (since in j1is we capture Duties on raw material's assesable value where as in j1iex we capture duties semi finished goods given by sub contractor.)
2.Kindly eloborate treatment of excise duties captured in these steps.
Revert if you didnt understand this scenarion.
Regards,
Sravanthi.Y

Hi,
57fc challan will be issued when we send raw materials to subcontractors WITHOUT EXISE DUTY.Hence not relevant in my case. But my case is WITH excise duty.we send subcontractor the excise invoice by using j1is. later he will process these raw materials and will give back the semi finished goods along with excise invoice(which we will capture n post using j1iex). so my question will excise duties differ in j1is(excise invoice TO subcontractor) and in j1iex(excise duty FROM subcontractor)?

Returns in subcontracting process

In subcontracting Process once materials is delivered by vendor and if the material has to be sent back to vendor whatis the Procedure? If the company is in bangalore and vendor in Mumbai what are the documents needed for return?

Hi,
If material is excise and Returnable(by vendor) plz follow this procedure..
a) Issue Mb1B with 541 mov type and create Challan in J1if01make 541 mov type doc as Delivery note Doc
If material is excise and Non-Returnable(by vendor) plz follow this procedure..
b) create return PO(ME21N) and do GR 161 mov type..
regards,
Priya

FICO Impact for Subcontracting process

Hi Experts,
can u please explain the impact of Subcontracting Process (specialy in GR/IR) On the FICO area, with transaction keys (FRL ....) involved.
thank u very mutch.
NB: If u have a doc on this please send on [email protected]
Thanx In advance.
S.D

Hi
Suppose you have semi finish product for which subcontractor consumed one raw material from you,then while doing GR and IR your accounting entries are as follows:--
While making GR:-
1.Dr in Stock accountBSX.OP+RMP
2.Cr in Change in stock accountBSVOP+RMP3.Dr in External activityFRL.OP
4.Cr in GR/IR clearing acctWRXOP
5.Dr in Raw material consumption acctGBB(VBO).RMP
6.Cr in Stock acct of raw martlBSX.RMP
OP:-Operating price or labour price
RMP:-Raw material price.
While making IR:-
1.Cr in Vendor account--OP+Tax or deviation
2.Dr in GR/IR clearing AcctWRXOP
3.Dr. in Tax account(Input)--VST maintained in Tcode OB40-Tax or deviation.
FRL transaction key used for posting your labour cost and same will be credited in your GR/IR clearing acct.
Because in subcontracting you only pay for Subcontractor's Labour charges.
Reward if it helps
regards
rb

PPDS Subcontracting Process

Hello Experts,
I am trying to replicate the subcontracting process through PP/DS run.
Business case: Handover the components from the destination location (DEST) to the subcontracting vendor (SUBV) to manufacture the finished goods. There is absolutely no operation that we do related to this. Subcontracting vendor provides us back the finished goods and we sell it.
Steps I followed:
1. For the finished goods product, I have created the BOM which includes the components which we handover to subcontracting vendor.
2. I have defined the finished goods product as procurement type X and Special Procurement key as 30 (Subcontracting)
3. The PDS is created. With production line as Subcontracted workcenter. Routing set up as N.
4. On the APO system, I have created a handling resource and assigned to model 000 and then assigned this Inbound handling resource for the location DEST. Please note that SUBV is not part of our supply chain, we are planning without source location.
5. Inforecord is created as a subcontracting inforecord and Production version is assigned at this Inforecord.
6. SUBV is CIFfed, Part is CIFfed, PDS is CIFfed, Subcontracting Inforecord is CIFfed and it created the transportation lane as well and default means of transport is assigned (and not product specific means of transport). Also there is no transportation resource assigned to this means of Transport.
7. Now when I ran the PP/DS Heuristics, it creates a Planned order. At this point, there is no subcontracting purchase req or order created on ERP system. And we don't CIF the planned order as well to ERP.
8. Now I trigger the convert planned order to production order manually by setting the conversion indicator. At this moment, a production order of type PP01 is created on ERP system. And this production order is also visible on APO system.
But the issue is still there is no Subcontracting purchase requisition or Subcontracting purchase order created in the ERP system. Is there something else like a basic settings which I am basically missing? Or is there anything wrong in my steps?
Thanks,
Suresh

Hi Shankar,
Yup, I can see the PDS. And regarding the second point, planned order is created as Inhouse. And it doesn't choose the subcontracting PReqs. I see the following error message, if I try to change the source of supply as Externally procured. I have maintained the Inbound Handling resource on DEST location. But I haven't maintained any transportation resource. Is there anything I am doing wrong?
Subcontracting PurchReq from location SUBV to loation DEST not created
Message no. /SAPAPO/RRP156
Diagnosis
The following causes are possible:
No handling resource has been specified in one of the locations involved.
No transportation resource has been specified in the transportation lane between the locations.
These resources must be available for subcontracting since the system executes detailed scheduling for the relevant orders on the basis of the resource calendar. (The relevant orders are a purchase requisition in your own location and a planned order at the subcontractor's location. The orders are linked by a cross-order relationship.)
System Response
The system cannot create the subcontracting purchase requisition.
Procedure
Enter the resources required in the location or in the transportation lane.
Thanks,
Suresh

Subcontracting process to multiple vendors

Dear friends,
We have got the subcontracting process as below.
1) Material is given to subcontracting vendor for making finished product.This job consists of 5 operations.
2) After making 1 operation at first vendor ,for remaining operations,partly processed material is given to second vendor from outside vendor to vendor.
3) After 2 nd operation is completed,remaining 3,4,5 operations,material is given to 3rd subcontracting vendor.
Then material is recieved to our place.
Material is moved from vendor to vendor without coming to our location.At the end of the process only finished prioduct will come to our location.
How to handle this scenario if finished product is completed within 180 days
---How to handle this scenario if finished product is completed more than 180 days.
--One condition is that it is not possible to take GR every time to our location and issue to next vendor because materials handling is very difficult every time.
Please suggest.
regards,
Canand

Hi Anand,
1. Create a PO to 1st vendor.
2. Maintain the required entries.
3. Go to delivery address tab tick SC Vendor
4. Maintain 2nd vendor here.
It means that after finishing first operation 1st vendor sends a matl. to 2nd vendor.
If u post migo for 1st PO(i.e. for 1st PO vendor) system says that matl is with 2nd vendor.
So u need not to send the matl to 2nd vendor.
Similarly, do it for other vendors also.
Here important thing is U have to send a PO to respective vendors for respective operations.
For the last vendor who gives u the finished product dont tick SC vendor to him. Maintain ue company delivery address.
and "answer for ur 180 days"
Who ever with the material once the matl went from ur company premices, from that day ur 180 days starts.
If it comes within 180 days no tax to pay on that material, other wise u have to pay tax.
further u need any clarification, do reply
Reward if useful
Regards
Viru

Subcontracting Process in SAP

Hi Friends,
Please help me to make me understand of subcontracting process for Automotives.
FYI our Plant is a 3rd party warehouse system. Our requirement is how (which triggers) the Delivery/Delivery Due list shipment of the components of the Subcontracting Assembly from Plant to Subcontractor can be done in SAP.
How the Planning of the components of Subcontracting Assembly can be done with help of MRP at Subcontractor level. Also we want to keep the safety stock at all the locations including subcontractor for components.
Any suggestions would be helpful..
Thanks and Regards,
Nabin

Dear,
There are two main options, I have not clearly understood your requirement, however please go through my explanantion, may be helpful
The procedure you are talking about in you serial no 1 to 4 is the <b>material subcontract...</b>the procedure is as below
Let us say you have a final product C.
C needs B
B need s A
A needs raw material X and Y
In the above case
C and B is having routing
In A material master MRP2 view....enter special procurement key as subcontracting(in STD sap the key is 30), procurement key = F
A has a BOM having items X and Y. No routing for A
When you run MRP
System will create Pl order for C and B, SUBCONTACTING PR to A and PR to x and Y
After you procure X and Y, You can convert PR of A to PO.
Then you will send the material i.e. issue the material to subcontractor through 541 and special stock O.
This stock you case see in MMBE with special stock O.
Once you receive the material A, when you do GR, the materials are issued to A and A will be inventarised with mov type 101.
The cost of serve and the cost of raw material is booked to cost center entered in subcontracting PO.
The cost of this will be settled to production order later.

Subcontracting Processing charge Issue.

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