Subcontracting Procedure material provided by vendor

[pavan_kulkarni3]

Hello Experts,

Customer is sending one product out from factory for services. The Service Vendor will add the required components to the semi-finished product and convert it into the finished product and send it back to the factory. Here, I was thinking of Subcontracting process. But, the required components are not sending by Factory and these are added by Vendor and send the invoice of those products including the service Charges.

I believe this can not be achieved in the Subcontracting Scenario. Is there any way to handle this using standard SAP?.

An example is like below :

A material ( Semi-Finished) will go out from the factory to X Vendor.

X Vendor will add A1, A2 and A3 Components and send the final product to the Factory.

X Vendor create the Invoice of A1, A2, A3 Component values and Service Charges, Etc.,

The Factory settles the invoice.

Please let me know any such scenario possible with Standard SAP Configaration.

Thanks and Regards

Pavan

[kenmelching · Accepted solution]

From your standpoint you do not need to show consumption of the materials provided by the vendor since they are not processed through your inventory. You will pay the vendor for their services and the material they procured but the details of their procurement are for your information only. Those are details on their invoice.

The value on the subcontract PO includes their services and the materials they procure. That is what they invoice. Usually the vendor is responsible for the costs of they materials they provide, it sounds like in your case the vendor is paid their services plus the material cost, you would need to adjust the PO price in that case.