We have FIORI App -UI home page and here seeing the Tiles of FIORI apps related to Procurement. Keep up-to-date with SAP information and training. Sir, Here i have mentioned Subcontracting vendor creation, subcon info record and BOM creation with respect to FG material. Alerting is not available for unauthorized users, Right click and copy the link to share this comment, Approve purchase order (optional) Approval Process not, Transfer stock for subcontractor with delivery, Transfer stock for subcontractor without delivery, Goods receipt for subcontract order (without WM). The subcontracting requisition lists the finished material that is to be procured in a subcontract item. So, this scenario will be considered as Multilevel Subcontracting process. Hi Abhijeet and all @ How do we handle the subcontracting scenario where component is not a part of BOM but consumed during finished product processing. Essentially, this order type is the stand-in for what would be a normal order type in a standard OTC scenario. Vendor shall process the item / use the item provided & supply the final item. Posting an incoming supplier invoice. Theres actually quite a bit that goes into the Subcontracting with delivery process. Learn how to integrate SAP S/4HANA with SAP Ariba, SAP Fieldglass, and more. Create/Change/Display/manage/ My Purchase requisitions App Therefore, it was not possible to provide components batches but with background batch determination or to adjust consumption quantities. 2) Keep delivery address to plant as by default. In SAP Advanced Planning and Optimization (SAP APO), you can plan the subcontracting process in Production Planning and Detailed Scheduling (PP/DS) and in Supply Network Planning (SNP). Available quantity at the subcontractor is back to 76 packs, where the real information is 176 packs. Display Material document App Please note the movement types used: 101 for Goods Receipt and 543 for Issue of Components. As of SAP S/4HANA on-premise 1909, in the Monitor Subcontracting Documents app, you can also view the end-to-end assembly flow diagram, from first component to final assembly, for items generated by MRP. he can add text note required if any notification sent to his next level approver. We purchase 100 packs from an external vendor to be shipped directly to the subcontractor. Once PR is approved by Purchasing department top level authority. They charged the company for their services rendered. Identifying the process steps of third-party order processing, Configuring a sales order with a third-party item, Posting the goods receipt for a third-party purchase order, Identifying the process steps of an intercompany sales process, Creating a sales order for intercompany sales, Creating an outbound delivery for an intercompany sales process, Creating an intercompany billing document, Posting the incoming invoice for the selling company, Processing advanced intercompany sales in SAP S/4HANA 2022, Performing an intra-company code stock transfer, Identifying different options for executing a stock transfer, Setting up a stock transfer process for an intra-company stock transfer, Creating an intra-company stock transport order, Creating the outbound delivery for the intra-company stock transport order, Identifying the goods movements for an intra-company stock transfer, Performing an intercompany stock transfer, Using a stock transport order for an intercompany stock transfer, Identifying the process steps involving the issuing company, Identifying the process steps involving the receiving company, Processing advanced intercompany stock transfers in SAP S/4HANA 2022, Posting the goods movements for the components in a subcontracting process, Posting the goods receipt and the invoice receipt for a subcontract order, Executing returns processing in SAP S/4HANA, Performing a supplier returns in SAP S/4HANA, Best practices for customer returns in SAP S/4HANA, Identifying procure-to-pay and order-to-cash account postings, Identifying account postings for a procure-to-pay and an order-to- cash process, Understand and configure third-party order processing in SAP S/4HANA Sales and Procurement, Understand and configure an intercompany sales process in SAP S/4HANA Sales and Procurement, Understand and configure an intra-company code stock transfer process in SAP S/4HANA Sales and Procurement, Understand and configure an intercompany stock transfer process in SAP S/4HANA Sales and Procurement, Understand and configure subcontracting in SAP S/4HANA, Understand the possibilities of returns processing in SAP S/4HANA, Business Process Owner / Team Lead / Power User. Double click on Accounting Document. External subcontracting in procurement Create purchase order Approve purchase order (optional) - Approval Process not Transfer stock for subcontractor with delivery Process deliveries and picking Transfer stock for subcontractor without delivery Goods receipt for subcontract order (without WM) Record results Record usage decision Verify invoice Thanks for visiting. 5.Receive the material against the PO with movement type 101. 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. Start it and selectDisplay against Material Documentwhile inputting thedocument number as shown below and click Enter. Use transaction MIGO to provide components to the subcontractor. Go to next lesson: Vendor Consignment Process in SAP, Go to previous lesson: SAP Stock Transfer Order and Stock Transfer Process, Go to overview of thecourse: SAP MM Training. Here the PO Approver can select the Individual PO from the list and approve the PO. Make sure to implement the note 1397948 - Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1 if you work with subcontracting components in DESADV IDocs. it is more useful apps. Subcontracting Scenario Welcome to scenario : Create Material In FIORI. Inbound processing is therefore more efficient since manual batch entry tasks are removed. user can view the list of the transactions he/she used recently in left side of the home page.using Edit option they can customize i mean arrange the FIORI apps tiles based on their requirement. 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. Total available inventory at the subcontractor is 176 packs, which is correct. Hi, So, how does SAP know when and how to copy data between these two objects? This approach requires more manual effort and accounting acrobatics than is optimal. Create Subcontracting vendor in FIORI. Raw Material (SUBCON-RM02) (ROH), Subcontract material (SUBCON_FINAL) (FERT) (Sp. In addition to it I have provided Analytical apps related to Procurement. The procuring entity may provide these components to the subcontractor either directly (using one of Hit enter to search. I suspect, however, that the issue is that perhaps the status of the serial number is not being updated properly. Subcontracting components in an inbound delivery via DESADV IDoc Context Subcontracting purchasing with inbound deliveries used to be a paint due to problems with components provided to vendor processing - see the notes: 645119 - Problems for subcontracting using delivery Read More LE (Logistics Execution)MM PurchasingSAP ERPSAP S/4HANA 9 List Material document Apps then Subcontracting PR and PO with Approval (Release) and then issuing Raw material to Subcontracting vendor using Transfer posting (movement type 541) and once Subcon vendor manufactures FG material -he will issue back to us and intern we are receiving the FG Material using Goods reciept against PO created for FG Material. Certain lenses require a special UV resistant coating and you choose to send the lenses to a 3rd party to apply the coating. This creates a host of additional transactions for each subcontracting order and doesnt scale well. If a purchase info record has been maintained, the service charges are defaulted into the purchase order. We are sending and receiving same material and same serial numbers. Our issue is that when creating an inbound delivery on the purchase order to be delivered to the subcontractor, quantity to be delivered "disappears" from the ME2O report. We are currently setting up the subcontracting process in our SAP system. Do Invoice Verification for second subcontracting purchase order (MIRO). Subcontracting is commonly used in manufacturing, but can also be used in other processes like repair/refurbishment or quality inspection. The bill of material refers to the end product that the vendor will deliver. Also, you need to provide Material, Quantity, Delivery Date, Plant, and Price. Plastic boxes were provided to subcontractorsand they did required printing on these boxes. Again, that is not necessarily bad, depending on your accounting policies and the specific case. Thanks a lot!!!! One of the workarounds was to decouple subcontracting goods receipt and components consumption with the modification from the note 654613 Batches and goods receipt for inbound delivery for provision of materials for subcontract order. if they are ok with the PO then they can approve it else deny the PO. 6.MIRO to account for vendor's invoice for the service charge& material used by him. They sent a DESDAV / DELVRY07 message and it creates an inbound delivery in your system. However if they have never been shipped due to a loading problem on the subcontractor side, that is definitely not ok. A subcontracting product is valued with the price of the service plus the cost of the components. Analytical/ Report related Apps in FIORI. Is this possible? Lets start with discussing the steps that are involved in the subcontracting process in SAP. Finally, it is necessary to click Post button to save the document. The good receipt and the goods issuewill be done simultaneously by the SAP system. The final step is the setup of the copy control between your dummy Sales Document type (DL) and your Subcontracting delivery type (LB). 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. Editors note: This post has been adapted from a section of the book Sourcing and Procurement with SAP S/4HANA by Justin Ashlock. What is S/4HANA? As the worlds leading SAP publisher, SAP PRESS goal is to create resources that will help you accelerate your SAP journey. Process flow of basic subcontracting process with deliveries 1 - ME21N - Making Subcontracting Purchase Orders In order to create a subcontracting purchase order it is necessary to choose an item type 'Subcontracting': 'L' as highlighted in the screen below. The process uses what you could call a Dummy Sales Document Type. This enables you to assign information about the batches used and the component quantities in the inbound delivery. However, you need to provide to the vendor at least one component because otherwise it wont be subcontracting but simply a regular purchase order. What do you think? Did you learn something new? 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. You order the end product using a subcontract order. ME2O after purchasing and before inbound delivery creation. These two options are now combined into one driven by MRP areas, but it doesnt require material data on all components and can support full-lot sizing and sourcing functionality. A planned order in the subcontractor location produces the material in that location and a stock transfer requisition transfers the material from the subcontractor location to the demand location. Try to test the IDocs with WE19 transaction. SAP MM - Procurement Process. 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 This often is used as justification by finance and other stakeholders on the buyer side for setting up phantom plants to represent the supplier and then moving and tracking the materials in these plants. The vendor will be billed only for items delivered. 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) Uv resistant coating and you choose to send the lenses to a 3rd to... 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