Subcontracting

[Former Member]

Dear Gurus,

I want to send material for subcontracting to A vendor. Vendor A is aslo using SAP system . How he will recive the Subcontracing material in SAP.

Please explain in detail

Regards,

Ishwar

[Former Member]

Dear Gurus,

This is urgent .

Plz revert back for any clarification.

Regards,

Ishwar

[Former Member]

Hi,

Vendor will do the GR as non valuated goods.So that no financial documents are created and also stock can be maintained. After processing the vendor will do the GI. Vendor will raise the invoice as service invoice and he can also raise the invoice for any material used as sale of that material to u.

Thanks

Arun

[Former Member]

Hi

He can receive material FREE OF COST from customer or he can receive material against sales order.

You just need to check with your sub-contractor what setup he is having to receive your material in SAP.

Regards

Rang

[Former Member]

Dear Arun & Ranganath,

In that case how Vendor will get his costing & profit data.

In case of Sales order , how Vendor will calculate material cost ???

Ishwar

[Former Member]

Dear all,

Please reply.

Ishwar

[Former Member]

Hi,

In case of subcontracting only we can track the vendor stock because no stock movement at the vendor place in thsystem.

Thanx

[Former Member]

Hi,

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.

Regards,

sasi

[Former Member]

Dear Sasi,

Thnx for ur reply.

But I am asking how vendor A will recive material in SAP.

I am asking a Subcontracing Cycle from Vendor point of view.

Ishwar