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Former Member

Material handling of in house and external procured material

Hi all,

We have a situation where we manufacture a finished product but also have a external contractor who produces on our behalf (when we cannot fulfill demand with our in house production).

Our current situation is to have two separate part numbers. During the booking in process of the contracted material we convert the part number to the internally produced part number. This means that we only have stock of the part number of the in house material (regardless of where it was produced).

The problem lies with the PPC of the materials when they are sold. All of the boilers will post the PPC (Material, Variable cost and Fixed cost) where as the imported boilers should be using transfer price (as they are made at a different plant within the same company). At the moment we have to manually reallocate the costs based on assumptions of which boilers have been sold.

Is there a way of linking the two part number together,so that on booking in the parts, we do not convert the material and that the sales order to the customer can draw from the stock of either part number posting the TRP or PPC of the materials that have been used?

Its a bit of a puzzle, so i would welcome suggestions.

p.s. I am a controller and not a developer and work on quite a restricted ERP version.

Many thanks.

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