PR to PO Conversion/ Create PO/Change PO/Display PO/manage PO/My Purchase order App. After saving this document system posts this material stock as stock provided to vendor. Posting the goods receipt for a third-party purchase order. Total available inventory at the subcontractor is 176 packs, which is correct. Trademark, SAP ERP Central Component all versions ; SAP ERP all versions ; SAP R/3 Enterprise all versions ; SAP R/3 all versions ; SAP enhancement package for SAP ERP all versions ; SAP enhancement package for SAP ERP, version for SAP HANA all versions, During the Subcontracting process there is no Delivery and Purchase Order link, Using ME2O transaction to create an Outbound delivery there is no direct link between the subcontracting Purchase Order and the delivery note, SAP Enhancement package for SAP ERP, version for SAP HANA. Next,provide Amount in the box to balance the amount of service provided. Through Screen shots process is self explanatory. We use the ME2O transaction to manage inventory at the subcontractor, and we use inbound deliveries on all our purchasing processes (inbound deliveries are used through VL06i to provide the subcontractor a report with incoming receptions, and to create batches). Subcontracting will appear under the general plant stock if there is no MRP area maintained for the supplier. They sent a DESDAV / DELVRY07 message and it creates an inbound delivery in your system. It brought: Subcontracting Components in Inbound Deliveries. Its being processed by subcontracting vendor, convert it to semi-finish material and deliver back. Get an overview of our wide selection of books on every relevant SAP topic. SAP process flow Create a subcontracting Purchase Order (ME21N) Delivery of components to subcontracting vendor (ME2O) Post Goods Issue (VL02N) and ship the materials to the Subcontracting Vendor using a delivery challan. Proudly powered by WordPress I believe the serial number records track whether the item is in warehouse or somewhere else. First, well start with. Raw Material (SUBCON-RM01) (ROH) Analytical/ Report related Apps in FIORI. demand for the finished item in the subcontractor location, nor can you change the component demand in the subcontractor location. The system will generate a purchase order number internally. Goods receipt items for the packaged SIM cards (end product) supplied by the vendor. (Movement TYpe 101). | Create/Change/Display Procurement Info record App However, the integration with an SAP ERP system requires at least SAP ERP 2005 with Enhancement Pack 03. no PIR as a subcontracting is not mandatory, Can you help with sub contracting Scrap process. SAP process flow 1. Below are the steps involved in this process. In our process, it happens that some components (raw materials) are being purchased from an external vendor to be directly shipped to the subcontrator. The process uses what you could call a Dummy Sales Document Type. They sent a DESDAV / DELVRY07 message and it creates an inbound delivery in your system. The components that the vendor needs to manufacture the end product are specified in the subcontract order. Really its very useful for content. To illustrate with an example, your company manufactures lenses. When delivery papers are needed, a delivery should be created. 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. Learn how to integrate SAP S/4HANA with SAP Ariba, SAP Fieldglass, and more. Here, the manufacturer places an order with an assembly provider for a certain number of finished goods, then provides the parts that the assembly supplier is to use for putting the finished product together. 1) Post Goods Issue according to the Purchase Order number (4500000863) above. 5 * Rating. I'm looking forward for the next ones , Thanks for sharing. It means that the Cost(per unit) which is reflecting in MIGO is sum of raw material and the additional cost given in condition tab in subcontract PO. Please keep posting the knowledge. Subcontracting materials are sent to vendors for processing finished products. Account Assignment and Item Category are usually blank in a subcontracting PO. Subsequently, the IDoc inbound scenario DESADV / DELVRY07 was enhanced to support subcontracting components in inbound deliveries communicated electronically the note 1397948 Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1, The problem with the above solution is that subcontracting components quantities transferred with DESADV / DELVRY07 message get fixed in the inbound delivery. A subcontractor provides a product on pallets and they notify a shipment of a full truck load, of say 30 pallets. Subcontracting is a form of procurement in which the product to be procured is manufactured by a supplier (the subcontractor) to whom the procuring entity supplies components for the purpose. Additional subcontracting SAP Fiori app functionality includes the following: In SAP, there are multiple ways of setting up this transaction, but many approaches add more complexity than they are worth. Legal Disclosure | Adding this value will open up the Components button located on the item Material Datatab. You cannot change the transfer (here material and components are MAT1 only). Thanks for visiting. Terms of use | The components are posted to the stock of materials provided to the vendor. The customizing entry in the supplier master is sufficient to trigger stock transfers and reservations from the plant to the subcontracting MRP area. It is likely to slip through tests and bite you only down the road. I wanted to highlight this process because it is cross-functional and is a bit different than other SD processes. 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 ME2O, Subcontracting PO, VGPOS, VGBEL, RM06ELLB , KBA , LE-SHP-DL , Delivery Processing , Problem. Billing the customer. So it will automatically explode when we create purchase order. Have any questions or comments? If you chose the MRP area route, material data on an MRP area was required for all components. First subcontracting vendor process and consume the raw materials to produce semi-finish material (SUBCONTRACT-01) and send it to the second subcontracting vendor. 2.Maintain the BOM for the material. Lets take a closer look at the handoff from Purchasing to the SD Delivery. Unfortunately they did not. The materials that are provided to the subcontractor are managed as stock provided to a vendor. The system proposes the labor charge from the info record for the subcontracting product. To access this piece of configuration, youll want to navigate to the IMG node below: Theres not much more here than assigning the plant to the Delivery Type. The subcontracting requisition lists the finished material that is to be procured in a subcontract item. Privacy | Material document posted and stock is placed in our location. 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. In MIGO, you need to choose Goods Receipt against Purchase Orderwith movement type 101 as shown below. Please note the movement types used: 101 for Goods Receipt and 543 for Issue of Components. Thanks a lot. After we post goods receipt through VL32n, inventory is shown into the ME2O tcode, and available quantity is back to 176 packs. I've just check that serial numbers are visible in the IDoc structure on both levels: But I don't have ready made examples. The subcontracting PO is made and I see a requisition in MD04 for a component but it is not tranferred to a production order. 1) In the SPRO> MM>Purchasing>set up Subcontractor order>assigning plants to the delivery documet LB 2) I have created a Customer master record in the same sales area as Material and then assigned it to the Vendor Control data (Vice versa also setting done:cCustomer master record control data vendor assigned) SAP process: 1.Create the finished goods material code. Now, press to display the components provided to the subcontractor for the finished material as shown on the screenshots below. Also it might be quite hard to spot at the first glance. In previous versions of SAP ERP, component materials to be provided to the subcontractor could be planned as a separate stock. Create/Change/ Display material App We are currently setting up the subcontracting process in our SAP system. We would love to hear your feedback in the comments section below. Here we can see the PO is approved- this is Classical App and looks like our ECC PO screen. This can be doneeither manually or through the use ofa BOM. You create a delivery for the lenses to be shipped to your vendor. Every organization acquires material or services to complete its business needs. The vendor charges for his or her service. Thx. Depending on the case it may be correct or not. Sales Order) to the destination (i.e. Create a subcontracting Purchase Order (ME21N) Click on "Material Data" tab under "Item details" and then click on "Components" to view the components / make changes. There are configuration elements only available on a Sales Document which drive these delivery creation. 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. In SAP, subcontracting is a sub-process within the MM Purchasing module and it almost always involves the delivery of goods from inventory to the vendor. 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. The outside person or company in this arrangement is known as a subcontractor. 1) Create Subcontracting Purchase Order to SC Vendor-02 (ME21N) 2) Keep delivery address to plant as by default. Procurement Overview Page- here we can see the overview of all the activities and we can track the process and expectation business will look for. The next step of subcontracting process in SAP isto do posting of invoice receiptagainst the purchase orderusing the transaction MIRO. Did you like this SAP MM tutorial? A delivery is then created with reference to that Purchase Order, but the delivery needs certain information in order to be processed correctly. Vendor shall process the item / use the item provided & supply the final item. We use ME2O, check the box next to the material then click on create delivery. In my opinion the business life is richer and more complex than the simplistic approach of SAP standard here. Case it may be correct or not Purchasing to the vendor needs to manufacture end. Document which drive these delivery creation the Amount of service provided delivery creation somewhere else the! Sap Ariba, SAP Fieldglass, and more complex than the simplistic of! Components button located on the case it may be correct or not vendor process and consume the raw materials produce. Subcontracting requisition lists the finished material that is to be shipped to your vendor address to plant by... ) Keep delivery address to plant as by default closer look at subcontractor... 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