System will allow to receive same serial number after subcontracting. The Latest ERP from SAP. the process is same as the ECC subcontracting Process. Then, expertly run your system after go-live with predictive analysis and machine learning. You create a subcontract order, following the standard procedure. You can return it partially or full using a Purchase Order or not. If you are running a vanilla SAP S/4 HANA system, chances are youll be looking at an LB delivery type (Delivery for Subcon.). Serial number is in warehouse only. Raw Material (SUBCON-RM02) (ROH), Subcontract material (SUBCON_FINAL) (FERT) (Sp. PR creation through FIORI Apps- Create PR apps. These components are usually associated with a BOM. This is a concern to us as ME2O is used as a cockpit to manage transfers and/or external purchasing for components and we need to have accurate information on stock levels any time in the process. This often is used as justification by finance and other stakeholders on the buyer side for setting up phantom plants to represent the supplier and then moving and tracking the materials in these plants. Finally, click on Postbutton to save the invoice receipt (IR). It can also be done through via MIGO transaction. We have got 76 packs (splitted in batches 293 and 316) at the subcontractor. Through VL31n tcode, we create the inbound delivery and the new batch for the material. SAP process flow 1. The vendor charges for his or her service. The consumption of the components is posted. Use transaction MIGO to provide components to the subcontractor. To create a subcontracting purchase order, start the transaction ME21N or navigate to thefollowingpath in SAP menu:Logistics Materials Management Purchasing Purchase Order Create (ME21N). The final step is the setup of the copy control between your dummy Sales Document type (DL) and your Subcontracting delivery type (LB). 2) Keep delivery address to plant as by default. Maintain these BOM in production version (Material master MRP 4 view) of respective header material. how do I make the subcontractor use one specific BOM, out of a multiple choice of boms that are ret up already? Also in previous versions of SAP ERP, you could check subcontracting stocks by supplier by running reports from a specific IMG menu path. The stock of the components provided to vendor is reduced as if the entire 30 pallets are shipped. If you are newly implementing subcontracting with PP/DS or SNP heuristics in SAP SCM 410, we recommend using the production data structure instead of the production process model. Thanks for the question, Kumar. Here the PO Approver can select the Individual PO from the list and approve the PO. However, you need to provide to the vendor at least one component because otherwise it wont be subcontracting but simply a regular purchase order. Finally, it is necessary to click Post button to save the document. Second subcontracting vendor process it further and produce finish material (SUBCON_FINAL) and finally send it to the warehouse of procuring plant. Double click on Accounting Document. There are configuration elements only available on a Sales Document which drive these delivery creation. Hit enter to search. If you chose the MRP area route, material data on an MRP area was required for all components. Thanks for your reply. Thanks for reading. Can we send Serialized component details as well in DESADV? You cannot change the transfer SAP Stock Transfer Order and Stock Transfer Process. I found a solution for this as we have to select Subcontracting Type 1 at item level. This is possible with or without creating a delivery. Create/Change/ Display material App No matter which process is utilizing subcontracting, it will always involve a Purchase Order. Legal Disclosure | Did you like this SAP MM tutorial? The system proposes the labor charge from the info record for the subcontracting product. 5.Receive the material against the PO with movement type 101. Therefore the 27 pallets received will be 10% more expensive than planned. You only have to maintain entries in the material masters if special situations exist for lot sizing, purchase requisitions/orders, and/or third-party order processing. Also, you need to provide Material, Quantity, Delivery Date, Plant, and Price. The F1 help on this field explains its own usage: The default for a pseudo order type for deliveries or delivery items that do not refer to an existing order. Capable-to-Match planning (CTM)supports subcontracting with source location in PP/DS and in SNP, and subcontracting with third-party provision of components in PP/DS and in SNP. Your comprehensive guide to SAP S/4HANA sourcing and procurement is here! The components are then supplied to the vendor. Thanks for visiting. Activating PR & PO Approval Notification. 2.Maintain the BOM for the material. Invoices will be entered in the system against the purchase order. When the subcontractor receives the raw SIM cards at his premises, he will inform the client and a goods receipt will be posted with reference to the purchase order increasing the subcontractor stock in the system. Next, click OK checkboxes as shown below. The bill of materials (BOM) is a formally structured list of the components that make up a product. Any one help me to this query ASAP? PO Items relevant for Subcontracting will need an Item Category of L for Subcontracting. Thanks and Regards, Sapmm user Find us on Privacy Terms of Use Some components also come from our warehouses. could you please add by product and co product scenarios in subcontracting process, If subcontractor not consumed all the components/ who need more subcomponents against same order , then how to issue additional components Proc 30) Im a career-long IT specialist with a focus on SAP for over 18 years. Posting Invoice verification using Create Supplier Invoice Apps in FIORI. 3) Enter Net Price (Processing cost) 4) In the item detail tab,Material data click on components and Explode BOM 2 Goods receipt for first subcontracting purchase order items (MIGO) Hi Abhijeet and all @ How do we handle the subcontracting scenario where component is not a part of BOM but consumed during finished product processing. As subcontracting Process everybody knows and it is not a new topic.. the issue of components which we provided to the Subcontractor is triggered to 543 Movement type SAP Training Shop is not currently supported on Internet Explorer. This is where you maintain all the components which need to be sent to the vendor. Eventually, that difference will reach the cost of goods sold and will hurt your profit margin. SAP Ariba Supply Chain Collaboration for Buyers provides an extra layer of visibility that has been sought in the subcontracting process, including component receipt and consumption notices from the supplier, as well as full business-to-business-level manufacturing visibility into the suppliers progress. We can drill down based on the number of days based on PO creation and if any urgent PO requires approval then Po approver can approve it immediately when required. I showed how the STO process has a default delivery type per plant, how that delivery type contains a default (dummy) sales document type, and how those two objects are connected through the standard Order/Delivery Copy Control. As explained above, this is mostly for determining things like copy control and to help determine item categories. SAP MM - Procurement Process. Alerting is not available for unauthorized users, Right click and copy the link to share this comment, 645119 Problems for subcontracting using delivery, 338119 Goods receipt in inbound delivery for SC order, 654613 Batches and goods receipt for inbound delivery for provision of materials for subcontract order, 1397948 Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1, 1397948 - Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1. Very easy to understand now. Here we can see the PO is approved- this is Classical App and looks like our ECC PO screen. Is the Info record mandatory in subcontracting ? Subcontracting is commonly used in manufacturing, but can also be used in other processes like repair/refurbishment or quality inspection. If the material is managed with batches, a batch number will be shown as well. Adding this value will open up the Components button located on the item Material Datatab. Is there a process to bring components back from the Subcontractor . if they are ok with the PO then they can approve it else deny the PO. You can use this business function to enter subcontracting components in the inbound delivery, or you can fill the subcontracting components using a shipping notification from the supplier. Please let me know in the comments. Create/Change/Display Bill of material (BOM) App Sales Order) to the destination (i.e. eg: sending MAT1 with serial number 100020 to the subcontractor for repair. SAP ERP all versions ; SAP R/3 Enterprise all versions ; SAP R/3 all versions ; SAP enhancement package for SAP ERP all . If the components for the finished product are to be provided by another supplier, you can plan as follows: Subcontracting with Third-Party Provision of Components in PP/DS, Subcontracting with Third-Party Provision of Components in SNP. PO Approval App. The shipments are made against the open qty through the SC requirements, unless someone knows of another method to ship that links the delivery to the SubCon PO. Mapping procedure of a given scenario in SAP system. Finally, you will see the accounting document created for goodsreceipt and goodsissue. Your email address will not be published. The transaction shows the requirements for materials from the specified vendor and displays a color coded status in green if the vendor has sufficient quantities of the components, in red if the vendor does not. It is also possible to see accounting documents that were automatically generated by the SAP system during posting of material movements. Subcontracting Purchase Order to SC Vendor-01, 1) Create Subcontracting Purchase Order to SC Vendor-01 for material (ME21N), 2) Indicate SC Vend in Item Detail Delivery tab to SC Vendor-02 (also tick the check box), 4) In the item detail tab,Material data click on components and Explode BOM 1. If there are any additional charges required, you input them in the Conditions tab as shown on the screenshot below. Use the IMG path below for this piece of the config: The only field worth mentioning is that Default Order Type field; the rest of this is standard delivery setup. Get unlimited access to all SAP PRESS books! Without knowing the error message, it is tough to diagnose the issue. A good explanation of Subcontracting process for 2 level. Simple and in an easy language. Next, click OK checkboxes as shown below. (It is already delivered). Procurement Overview page Apps. Right side of the home page we have PO list waiting for Approval- we have the option of approve/deny based on the PO approval persons/authority decision. Does this sound familiar? Abhijeet - Thanks for sharing this blog. Explore ABAP, FICO, SAP HANA, and more! The SIM cards will be issued with reference to the subcontract purchase order. (ls_comp-fmeng = abap_true). We are currently setting up the subcontracting process in our SAP system. The next step of subcontracting process in SAP isto do posting of invoice receiptagainst the purchase orderusing the transaction MIRO. You probably know where this configuration is, but for the noobs: These are all default settings, so again not much to say here. The bill of material refers to the end product that the vendor will deliver. Sub contracting Info Record Created in FIORI. 1) Post Goods Issue according to the Purchase Order number (4500000863) above. no PIR as a subcontracting is not mandatory, Can you help with sub contracting Scrap process. Upon issuing a subcontracting PO and shipping out the components to the supplier, the buyer doesnt technically receive updates on the production of the order until the final product or subassembly with the components is shipped back from the supplier to the buyer. Now receiving the FG Material from Sub contracting vendor to our location. Procurement should be done in such a way that materials are ordered in correct quantity, with a proper value at the proper time. In this blog post, we took a look at subcontracting functionality in SAP S/4HANA for logistics. The PPM consists of components and operations. Make a request for us to schedule training around what works for you? 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