Knowledge Management

Question:
Hi Experts
Is it possible to have an operation on a production order for a subcontracting process?
Instead of issuing material to Subcontract Purchase Order we would like to issue material to a production order, but somehow capture the labor costs from the subcontract vendor. The finished material that the subcontract vendor delivers to us would be received via a 101 movement - production order receipt instead of 101 purchase order receipt.
The reason we are interested in this process is because we want to work exclusively with ATP commitments and subcontract orders do not commit properly with ATP. We don't want to issue material to the subcontract vendor if the material is not available per ATP. Be using production orders we can see what components are short for the subcontract vendor by using the missing parts list.
Answer:
Hi,
Yes u can define externally processed operation in the operation sequence. It is controlled ny the control key attached that operation.
U can also assign what all materials are required to be sent to Sub Contractor
But i don't think that u can receive the material from Sub contractor by confirming production operation.
To my knowledge, a purchase requisition would be created which in turn can be converted into Purchase Order and when the material comes in, u will have to do GR against that Purchase order. By doing GR, that particular operation in Production Order would automatically get confirmed.
I hope that might solve ur query.
Regards,
Mangesh
Answer:
You can get around the problem described by Mangesh by writing the purchase order for a service rather than a product, i.e. instead of having a P.O. for 100 semi-finished units write the P.O. without a material number for the subcontractor's conversion cost for 100 semi-finished units. When you post your receipts against the P.O. the subcontractor's cost will be charged to the production order and you can post the finished production as you normally would. We have done this successfully with our subcontracting operations.
Answer:
Hello Darrell,
I would like to extend query raised by sappro. We have similar situation here.
Once our finished product is ready, we get the FG painted by the sub-contractor. The cost involved in painting is substantial. Our FG doesnot go outside our factory premises ***. The sub-contractor does the painting inside. Right now we are doing service purchase order on the sub-contractor. But this cost does not go to the moving average price of the FG. Is it possible to apportion this cost to the MAP of the FG ? We have not gone for CO.
-Harish
*** Those who have SAP experience in India will know the Excise and other tax complications involved in this. Please advise.
Answer:
HI
I m Extending it further..
One can identify inprocess - out bound subcontraction and schedulle it.. thats fine with me.
My confusion starts here..
For subcontracting, i need to issue some material which is the output of last operation before subcontracting for the receipt material from vendor.
means.. i have to receive somehow that componenet from last operation (bec i need to keep track on the mat. sent to subcontracting) and issue it for subcontractiong and material received from the sucontaction should be persent as a component.
looking at above scenario i can not incorporate inprocess subcontracting in one routing/production order.
i will have to create two production orders..
1 for receiving component for subcontracting
2 for issuing received material from subcontractiong to my main mateial.
m i right?
is there any way to do in single order ??
Answer:
Hi Ashish/fellow SAPiens,
This is a typical problem in all sites.
We have implemneted the solution like this:
Define 2 diff. mat.codes-input and out put mat.codes as required by CIN!!!
The input mat. will have a routing and gets mfg. inhouse and is sent out thru a s/c PO. which will be created for the Output material.U can configure the sytem to generate PRs for the out put mat. directly from MRP also.
This solved all excise and other aspects, but BOM needs to be broken and diff. mat. masters(codes) needs to be created.
Other option we tried was:
Define a externally processed operation(control key) and attach the input material in the routing.The previous operation is a milestone operation with input material attached as a by-product(define in BOM).So, when it is confirmed the by-product gets into stock at a defined location.From there u issue the material against the PR which gets generated for the externally processed operation.
Hope I am clear!
mvm.
Answer:
hi MVM
so i m right with my guess.. but indetifying by- product is dangerous may lead to wrong cost calculation...
thanks for sharing your experience
Ashish
Answer:
hi MVM
so i m right with my guess.. but indetifying by- product is dangerous may lead to wrong cost calculation...
thanks for sharing your experience
Ashish
Answer:
Thanks to all who replied. I will test your suggestions in the next few days.
Answer:
hello experts
i have problem of subcontracting as below
1 header material which GR is made canbe made from Two alternate materials. I have maintained alternate item for 2
how ever while creating subcontracting PO, one one material is selected. is there any way to select items to send in po?
thanks
nitin