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Different price for a product because of consignment raw materials

former_member335556
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Dear Experts,

Based on some contracts, we have to produce a product in different ways:

- In some cases we make the product completely by ourselves (raw materials, product and labor)

- In some cases we procure some raw materials but the others are consignment (procured by customer) and again we have labor cost.

The percentage of consignment raw materials are different in different contracts, so we have different price for semi finished and finished materials and also have raw materials with zero price (consignment) which will use in our production orders.

Except using split valuation for semi finished and finished material and using non-valuted material for raw materials, do you have any suggestion to handle this process?

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Answers (4)

Answers (4)

former_member197616
Active Contributor
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Hi ,

For the Contract 1 ----we buy X2 and X3 and use them in production order to produce X1.. I think this is straight case. PO for X2 and X3 and GR them and Produce X1 with X2 and X3 as BOM .

For Contract 2 : You are getting a PO which is subcon in nature , as you get X2 and X3 from your customer and labour them and send simple .This case you can manage with another BOM or alternative BOM . Here yiou can show the manufacturing cost variation

For Contract 3 : In the third contract we buy X2 but X3 is procured by customer, so we have labor cost and the cost for X2..This is also same as case1 more or less .

former_member335556
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Dear experts,

Any Idea?

former_member335556
Participant
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Dear raghavendra,

Thanks for your prompt reply.

For example we make X1 (finished) from X2 (Raw) and X3 (Raw).

- In the first contract, we buy X2 and X3 and use them in production order to produce X1.

- In the second contract X2 and X3 are procured by customer and we just have some labor cost to produce X1.

- In the third contract we buy X2 but X3 is procured by customer, so we have labor cost and the cost for X2.

So X1 will have three different actual cost.

We cannot use consignment PO (Item category: K) because we want to have trace of them in the system (GR and then GI to production order).

former_member197616
Active Contributor
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Hi ,

Not sure the consigned materials of Raw being procured by your customer and which have 0 value .

When you make the product at your facility SAP tackles this through PP by a production Order / process order with labour cost too .

You mean to say you use X1 as raw material , in the way you procured with one cost and another X1 procured consigned raw material with another cost ?

If so how you are going to get the Consigned Raw Material X1 FOR YOUR production through a Consignment PO with K . Your solution lies in this answer . Are you going to show the consigned raw in SAP ?

Normally the consigned material unless you use SAP will not valuate for that quantity .

If not you do not want to use split valuation , do you want to create another material X1-1 for Consigned Raw and show with diff errant price ?

If you want to create the non valuated Raw -- How , though you need a account assignment .

Also one more question is differrant contracts of differrant percentage of same Raw material price is differrant ?

Regards,