Subcontracting to vendor

hi all,
i am sending material to my vendor for subcontracting directly from my supplier place.how to map this scenario under sap.how to generate subcontracting challan in this case.
Kindly help me out.
Regards,
velu

Hi,
In subcontracting we have 2 types..one is without payment of duty and with payment of duty..anyhow iam enclosing both the scenario's..
Subcontracting without Payment of Duty
Creation of Subcontracting PO (ME21N)
Transfer Posting of Components to Subcontractor (Mvmt Type - 541) (MB1B/ME2O/MIGO)
Creation of Subcontracting Challan w.r.t. Transfer Posting Doc (J1IF01)
Goods Receipt w.r.t. Subcontracting PO and Refer Subcontracting Challan at the time of GR (MIGO) {GR with 101 and auto consumption of components with 543 movement}
Reconciliation of Subcontracting Challan (J1IFQ)
Completion of Subcontracting Challan (J1IF13)
Generation of Annexure IV (J1IFR)
Note: - In this case, you have to maintain the Assessable Value for the Components to be supplied to Vendor in J1ID and also Excise Tax rates for the Chapter IDs linked with these components. So during J1IF01, system will take the Assessable Value as Excise base Value and calculates the Excise Duties by taking Excise Tax Rates.
Subcontracting under Full Payment of Duty
Creation of Subcontracting PO (ME21N)
Transfer Posting of Components to Subcontractor (MB1B/ME2O/MIGO)
Creation of Outgoing Excise Invoice w.r.t. Transfer Posting Document (J1IS) - Used to send the components to Subcontractor's. Here 57F4 Challan is not created.
Accounting Entry: -
CENVAT Input BED - Cr
CENVAT Input ECS - Cr
CENVAT Input ECS - Cr
CENVAT Suspense A/c - Dr
Capture Vendor Excise Invoice at the time of GR of Finished Goods w.r.t. Subcontracting PO (MIGO)
Post Excise Invoice for FG received from Subcontractor (J1IEX)
Accounting Entry: -
CENVAT Input BED - Dr
CENVAT Input ECS - Dr
CENVAT Input ECS - Dr
CENVAT Clearing A/c - Cr
Regards,
Prasath

Similar Messages

Subcontracting with Vendor's own material.

Hello
I have a scenario wherein client sends a component for machining to Vendor and pays for the machining charges to the Vendor.
It happens that Subcontracting Vendor attaches say a nut bolt(hos own material,we have not provided the same) to the maxchine and gives it back.
How this scenario can be mapped in Subcontracting cycle so that we can pay the Vendor for machining and nut bolt.
Regards

SAP procurement subcontract process maps exactly to your real subcontracting process.
Prerequisite: turn the material to a BOM via CS01.
1. ME21N create subcontracting PO
    On the PO screen, select Item caetegory "L     Subcontracting" to make the PO a subcontracting one.
2. ME2O Send material components to vendor
    At this step, there'll no accounting document posted. Components sent are still your company's possesses.
3. MIGO Goods receipt the expected material and sent components to storage location.
    Now, The sent components values will be transferred to the received material. Payable amount is the amount entered on the PO for their additional components and subcontracting service.
Hope this helps,
Best,

Subcontracting Multiple Vendors

Hi,
i have one business process relating to subcontracting .
material has to supply to subcontracting vendor2 directly from the subcontracting vendor1.
in this scenario i have pay money to both subcontarcting vendors
I tried this scenario but not able to enter GR from vendor2 with respect to challan for material provided to Vendor1.
System giving me message the Challan not valid material doc is assign to different Vendor
Means Sending Material M1 to Vendor1 against Challan C1
Want to receive Material M2 from Vendor2 aganist same Challan C1
pls clarify me how to forward in this type of scenario
regards
Edited by: akshay sonurkar on Aug 23, 2008 2:01 PM
Edited by: akshay sonurkar on Aug 23, 2008 2:15 PM
Edited by: akshay sonurkar on Aug 23, 2008 2:41 PM

hi
in this case u have to make to po one to subcontracting vender and one to material vender (component)
then tick subcontracting vender in material vender delevery tab and put that vender no over vender field ,so material will deliver at subcontracting vender address then.
document flow is
po(subcontracting)-->po material->grn material---->grn subcontracting po.

Subcontracting stock : vendor code changed

Hi Gurus,
Can you please help me with this issue.We are using subcontracting orders, and provide components to the vendor (stock mvmt 541). Our vendor code has changed.We still have stock under the old vendor code, but the orders are now placed with the new one. How can we easily transfer materials from one vendor stock to the other ?
Thank you,
Sunny.

Hello Sunny
You have to reverse the earlier document of 541 to take the stock back.
I hope since vendor is changed, Old PO is not valid anymore. Delete / Blocked the old PO.
Then create the new PO with new vendor and send the stock again (541) to new vendor.
I hope it helps
Best Regards
Avinash

Subcontracting (Multiple Vendors Involved) and Production Version's

Hello all,
I would like to know more about this stuff. So do share your valuable thoughts.
I was trying out a sub contracting scenario with multiple Vendors and Production Versions involved. The production version is designated in such a way that lot size/quantity of the requirement determines which of the available version's to be taken into consideration whilst generating procurement proposal via MRP.
#1. Production Version:
5 Version's of the BOM are assigned to various lot sizes.
#2. I had 5 different info records created for the material-Vendor combination. Each one of them were assigned with a Prod version to it.
Sample:
#3. Post these settings i had a MRP run executed. Well !!! the results were different off-course. I neither did see the procurement proposals classified based on the prod version nor the first prod version assigned to the procurement proposals ( i meant i had a different prod version(version 4) assigned to the procurement proposals generated).
Questions:
#1. Well the first thing that did strike my mind was how could i get the source list work for such scenario's ? I guess i can't go with quota arrangement coz which would split the procurement proposals into many halves and assign's it accordingly to the vendor.
#2. How come production version 4 given the top priority here ?
Source List state:
                         a. I had an item (tried the others as well) checked with fixed vendor indicator but the info record of the material-vendor combination had a different Prod. Version in it (well not PR4, i can guarantee you on that)
                         b. I had nothing marked with fixed vendor indicator. Results post MRP still did pick the same prod version (Version 4).
#3. Last but not the least how can i get this thing to work ?
Please do help out.
PS: MRP 4 selection Method: 2 - Selection by Prod.Version
Regards,
Rahul

Hello Rajen,
Well as per your comment "
Regarding the splitting, Not Always.
There are two types of quota arrangement - Allocation quota and splitting quota."
so meaning that allocation quota doesn't split the procurement proposal is it ? If so how are they assigned to vendors ? any other criteria being used up here
Anyhow i had a new lot size method created with the splitting quota field unchecked. So how do i proceed from here ? meaning that how should i manage my quota file to not have my procurement proposals split ?
Please do help out.
Regards,
Rahul

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

Subcontracting in Production, 2 subcontracting vendors involved

Hi,
We have a scenario where in production 4 operations needs to be performed, one of which is a external process [subcontracting]
Process 1 - Drilling
Process 2 & 3 - Subcontracting [External process] u2013 2 processes
Process 4 u2013 Finishing
After drilling process, material is sent to subcontractor A for cutting, after this is done Vendor A will sent product to Vendor B directly for further operation . Once this is done We receive from Vendor B
Then it will go to Process 4 [Finishing]
Can you please help in mapping this scenario in SAP
If there is only one vendor involved then I believe process will be like one subcontract PR [system creates automatically], we issue goods and we receive finished goods
In this case Subcontract vendor A sends directly to Vendor B
Both Vendor A and B sends invoice to US
Any pointers in this regards will be of great help
Thanks

Hi ,
While raising the subcontracting order for vendor A enter Delivery address vendor B address & save.
Raise one more P.O(subcontracting ) with vendor B
when vendor supplied material to vendor do the migo.
then in sap stock will increase at vendor B.
when material recieved from vendor B do migo stock will increaes in respective plant.
you can procees invoice with P.O wise
Try this one & let me know
Rgds
venkat

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

Sub contracting plus vendor consignment.

Hi every body,
_Pl provide me the necessary solution for the following scenario:_ There is a vendor who is on sub contact to supply material A.
The necessary sub components are provided to the vendor to supply the finished product.
When the finished product is received , the product(material A) should be taken into vendor consignment stock,. i.e.,for the same material ,vendor combination both subcontracting and vendor consignment should be enabled simultaneously,
This is a real scenario, which needs immediate solution.Those who could give a solution shall be awarded points immediately.
Venkat.

Hi Venkat
Make Info record of same material and vendor for consignment and subcontracting
Receive the material say A by subcontractor in unrestricted stock and then transfer the stock by 412K into consignment stock and whenever required u can issue from that
regards
Anil

Subcontract order

Hi,
I having subcontract material u201CXu201D,
I made BOM for material u201CXu201D of child material u201CAu201D & u201CBu201D
I want to give material u201CXu201D to subcontract to vendor u201CZu201D
As per the process after making subcontract po to vendor u201CZu201D for material u201CXu201D, We have to send material u201CAu201D & u201CBu201D to vendor u201CZu201D.
We want to combine the functionality of the subcontract process and combine it with the BOM from a work order.
There a way to buy an item from Subcontract which consist of material u201CAu201D &u201DBu201D, in same subcontract po.
When we receive the finished kit, then, in the BOM from the work order on the shop floor, they are not able to see the sub-component of the kit. This is what we want?
(buying subcontract material and giving subcontract for finished goods to same vendor in single po , whether this possible ?, if yes how ?)
please help
Thanks in advance
Prashanth
Edited by: prashanth.venkategowda on Jun 4, 2009 7:25 PM

Hi,
Your question in bold letters are not clear enough. Kindly remake and send it.
Regards,
Prasath

What is Standerd Process of Subcontracting in SAP B1?

Hi experts,
I want to know standard process of Subcontracting in SAP B1?
as i know only the scenario that i have production of chair and i want that chair to give for subcontracting to vendor and again receive that chair and sale it
so how this process is done in SAP B1.
please help me

Hi,
Try this way:
1. Create item master for chair
2. Create item master chair-sub-con without selecting inventory and sales item
3. Create PO for chair-sub-con item to send to vendor for processing and receive item through GRPO.
4. You should have work instruction to follow sequence of operation ( You need some add-on for this)
Thanks & Regards,
Nagarajan

Subcontracting different delivery address

Folks,
I have a material that is subject to subcontracting. The order is placed at vendor 1 but the components first need to be delivered to vendor 2. After vendor 2 is finished, he will deliver the components to vendor 1. Vendor 1 will do his thing and deliver it back to the plant. Vendor 1 will invoice. Vendor 2 only acts as delivery address. How to capture this in SAP?
Thx,
MdZ

Hi Juergen,
Thanks for your reply. Vendor 2 will send an invoice to vendor 1 in this case.
I've thought about 2 subcontracting orders as well but the problem with that is, that I need to send components twice.
I.e. component A & B need to be sent and we receive material C.
So PO 1 subcontracting for vendor 1 with BOM for material C to be received and A & B to be sent. Stokc at subcontractor is material A & B.
So in case I create another subcontracting order but for vendor 2 which needs to be delivered to vendor 1, which material do I send to vendor 2? In case this is C, and I do GR for PO2, the material will be booked into vendor stocks, What do I do with that material?
Regards,
MdZ

Purchase from Vendor B then Sell to Ven A, Then purchase from A

Hi MM Gurus
Please help in mapping below scenario in SAP
In production we need small plates [Material A], MRP gives me total number of small plates needed. We convery this to local Vendor A. We do buy big plates from Vendor B and will sell to Vendor A. Vendor A will sell me small plates we need.
Since we negotiated good price with Vendor B, we sell big plates to Vendor A after buying from B.
Current Process
Total number of small plates needed = 300 [suppose] - From MRP
Big plates needed = 300 * 0.56 = 168
We do buy 168 plates from Vendor B and sell to Vendor A
Vendor A will sell me 300 small plates, no subcontracting process
Please suggest a way out to put this movement in SAP

334,
I think you haven't mentioned the full business requirements. How are you protecting your interests? What is there to prevent A from buying the cheap big plates from you, make them into, say, round plates, and then sell them to his other customers?
I am suspecting that there are further restrictions, or some sort of contractual agreement(s) you haven't mentioned. No matter what you say, it really smells like a subcontracting arrangement with A. For which SAP has a nice planning solution. This is what I would recommend that you explore.
If you are unwilling to treat it as subcontracting, then vendor A is responsible for calculating the required number of big plates, not you. Why all the bother with BOM? Just set a safety stock on Large plates. When A places his order with you, you will ship from stock, and during MRP, onhand balance for big plates will fall below safety stock level, and generate a new PR for the missing qty. Or, if you can stand the delay, just wait for A to place the order, and with zero stock on hand, MRP will immediately give you a purchase req to buy large plates from B.
Rgds,
DB49

Sub Contractor given contract to third vendor

Hi all,
i have scenario. suppose client given sub contact to vendor 'A' then vendor A given subcontract to vendor 'B'. Now vendor B returned material to the client. then How to deal this in MM. please explain with all accounts. Thank in advance.

Hello Babu,
I think you missed out to reply my question for the first post.
I repeat,
- Are you dealing with Vendor A or Vendor B?
- Are you raising PO for Vendor A or Vendor B?
- Are you paying to Vendor A or Vendor B?
If you are raising subcontracting PO for Vendor A, providing material to Vendor A and paying to him only then B will not come into the picture at all even if A is doing subcontracting with B, we have nothing to do with B.
If you are raising sub con PO for Vendor A, Vendor B is providing component material to Vendor A, and receiving material from Vendor A then there will be two saperate business transaction.
1. Subcontracting scenario with Vendor A
Accountig entry will be as follow:
There will be three accounting posting for three processes:
At the time of GR:
(For finished goods received)
DR FG Stock/ SC By-Product Stock
CR Change in Stock (FG/ SC By-Product )
(For moneys payable to Subcontractor)
DR Subcontracting Charges
CR GR/IR Clg
(Material provided to Vendor is now charged for consumption)
DR Consumption (Components)
CR Change in Stock (FG/ SC By-Product )
At the time of IR:
GR/IR will be debited
Vendor will be credited
2. Normal purchaising scenario with vendor B
GR:
Inventory will be debited (component material)
GR/IR will be credited
IR:
GR/IR will be debited
Vendor will be credited
Hope this helps.
Regards
Arif Mansuri

Subcontracting partial material

Several of you contributed to an excellent post last year on "subcontracting" - threadID 427179. We are trying to do a variation and having a challenge. We want to send out a partially completed material to a local vendor to do some work on it (e.g., if our tool is broken), then return it and finish the job:
For material X:
- operation 10: some processing toward X on machine A (BOM component, input, was raw material Y)
- operation 20: subcontract to vendor 123 (we'll send him the pile of partially complete X, which is not yet in inventory; he'll return it)
- operation 30: final processing toward X on machine C (we'll do GR on X)
With that other post, and some other insights, I have an external contracting operation on the routing, and a Purch Info Record with no material; the production order does allow the time for operation 20 based on the PIR; a Purch Req is proposed by the production order.
But two issues:
1. The PR can't be converted - something about no BOM components
2. If I recursively add X to it's own BOM, it doesn't help: I can get the PR to a PO, but I can't do a 541 movement from ME2o - there is no "inventory" anywhere yet (at least no material X's).
Any thoughts on how I might (a) have a 3rd party work on a material, and (b) account for the fact that a not-yet-complete material has been sent off sight and returned?
Thanks for any wisdom!
Thomas.

Thanks for the response - a service PO - that sounds like the kind of thing I'll need, but I still need to have the routing account for the expected time at the service vendor, and I still need to get the material there and back.
Let me try to do a better job of explaining the functionality: Suppose we're building a metal casting - like an engine block (material X). When we're done, we'll just have that one piece of metal. We start with a rough block of metal (raw material Y).
Operation 0010, we do some machining on a big milling machine; but we don't bring the result into inventory yet.
Operation 0020, that big piece of metal has to go into a special oven to heat treat it; ours is full, so we want to send the big piece of metal down the street to a vendor who has a similar oven; he treats it and sends it back
Operation 0030, we now take that heat treated piece of metal and do some final milling on it, the result of which is a block we can put into inventory (as a sub component of some other assembly.
Usually, we have capacity in our oven, so it is easy to have one material go through those 3 operations. That way we just have one routing, one BOM for that component, one production order. All of our other BOMs which need that casting (e.g., to make various other sub-assemblies) expect the completed casting to be material X.
Does that make sense? Thank you for your interest!
Thomas.

Subcontracting to vendor

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