The fixed quantity indicator is always set automatically for all components, so that no correlation occurs for the component quantities when changes are made to the inbound delivery quantity. Create Supplier Invoice Apps or Incoming Invoice Apps. Analytical apps related to PR, PO, GR, IV- Here we can see the PO is approved- this is Classical App and looks like our ECC PO screen. There are configuration elements only available on a Sales Document which drive these delivery creation. Finally, it is necessary to click Post button to save the document. We want to receive back MAT1-100020. Double click on Accounting Document. Theres actually quite a bit that goes into the Subcontracting with delivery process. The bill of material refers to the end product that the vendor will deliver. Learn how to integrate SAP S/4HANA with SAP Ariba, SAP Fieldglass, and more. Visit SAP Support Portal's SAP Notes and KBA Search. Again that is confirmed by the note 1397948 Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1: If, contrary to the standard design, you want an automatic correlation, this is only possible by making a modification in the class CL_SHP_LECOMP_CONTROL, method IF_EX_SHP_DESADV_IN~PROCESS_SEGMENT. This is where you maintain all the components which need to be sent to the vendor. Itd be a big help for us, and hopefully its something we can address for you in improvement of ourfree SAP MM tutorials. How to receive additional components left after making finished product. Subcontracting is one of the procurement processes available in MM. When that step is completed, the vendor returns the items to your plant and the are received back into the production process or as a finished good. 3.Create PO with item category as "L" . Very easy to understand now. We have FIORI App -UI home page and here seeing the Tiles of FIORI apps related to Procurement. 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. The SAP PRESS Blog is designed to provide helpful, actionable information on a variety of SAP topics, from SAP ERP to SAP S/4HANA. They are summarized below: A material BOM needs to be created before any subcontracting order can be placed. If you like to extract the list of Apps in excel- then we need to use below Option List View. This is done when SC Vendor-02 sent finished product to our warehouse. 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. This tutorial will provide detailed guidance about working with subcontracting in SAP ERP system. Option- 2 User without login to each and every Individual PO -he/she can approve directly form FIORI Home page -Inbox part. Now, when the subcontractor returned the materials after performing the workyou need to enter the received finished material back into the SAP system by using the transaction MIGO. Billing the customer. We only pay the prime contractor, prime pays the subs. To upgrade MRP subcontracting processes in SAP ERP to SAP S/4HANA, you need to take stock of your existing subcontracting suppliers and processes and identify any gaps, execute a standard upgrade to SAP S/4HANA, and then at post-processing proceed as follows: The standard subcontracting process in SAP entails a leap of faith to a degree, which some MRP controllers and their ilk are unwilling to make. Analytical/ Report related Apps in FIORI. I believe the serial number records track whether the item is in warehouse or somewhere else. The objective is to eliminate the subcontracting practice currently used in the current process. 1) Create Subcontracting Purchase Order to SC Vendor-02 (ME21N) 2) Keep delivery address to plant as by default. System will allow to receive same serial number after subcontracting. This improves batch tracking for the sold-to party. user will convert to PO. The first line corresponds to the goods receipt of the final product, whereas the second two lines correspond to theissue of components which you provided to the subcontractor earlier. Next, click OK checkboxes as shown below. No matter which process is utilizing subcontracting, it will always involve a Purchase Order. It can also be done through via MIGO transaction. Do you need to create a recipe for sub-contracting process? A subcontractor provides a product on pallets and they notify a shipment of a full truck load, of say 30 pallets. Now, lets display thedocument that we have just created. Can you explain how to do this process without BOM?? They charged the company for their services rendered. Thanks and Regards, Sapmm user Find us on Privacy Terms of Use Creating a sales order for intercompany sales. You order the end product using a subcontract order. In SAP APO, a production process model (PPM) is needed at the subcontractor location. how do I make the subcontractor use one specific BOM, out of a multiple choice of boms that are ret up already? Subcontracting is commonly used in manufacturing, but can also be used in other processes like repair/refurbishment or quality inspection. Once PR is approved by Purchasing department top level authority. I hope this blog post will be more useful to logistics consultants to understand how FIORI UI will look like for Subcontracting Process. Participants will also learn about the associated customizing settings for the selected cross- application business processes. Am I right or wrong? Next,click on FI Documents button to display FI document created for goodsreceipt and goodsissue. Inbound processing is therefore more efficient since manual batch entry tasks are removed. The components are then supplied to the vendor. Subcontracting is a critical process for many organizations, and from an SD consultants perspective its quite unique. Can any one explain me the step by step procedures of Subcontracting Out Bound Delivery, I have created the purchase order with the finished and the components, the components has to be to be moved to the subcontractor with outbound delvivery, following are the settings i have maintained, 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), 3) i am using only ME2O(NOT ZERO) Transaction for the Outbound delviery, 4)when i am pressing the create delivery in the ME2o report, Essential transfer parameters are missing in record: 000001:Message no. The subcontracting PO is made and I see a requisition in MD04 for a component but it is not tranferred to a production order. Tracking the materials and valuations, which technically still belong to the buying organization, becomes difficult using the standard process. Create/Change/Display/manage/ My Purchase requisitions App he can add text note required if any notification sent to his next level approver. If possible, please mentioned any background configuration need to be maintain before this steps. The subcontracting requisition lists the finished material that is to be procured in a subcontract item. I am a husband and father. I have a question. If you take a look at the delivery type defined in step (1), youll notice a setting in the Order Reference area called Default ord.ty.. 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). It brought: Subcontracting Components in Inbound Deliveries. This is my first blog on SCN and I want to share my knowledge on Multilevel Subcontracting Process. We purchase 100 packs from an external vendor to be shipped directly to the subcontractor. 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. SAP MM - Procurement Process. 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 Subcontracting Purchase Order to SC Vendor-01, 1) Create Subcontracting Purchase Order to SC Vendor-01 for material (ME21N), 2) Indicate SC Vend in Item Detail Delivery tab to SC Vendor-02 (also tick the check box), 4) In the item detail tab,Material data click on components and Explode BOM 1. Proudly powered by WordPress SAP process flow 1. This transaction is now available as an app, Display Subcontracting Stocks by Supplier, in SAP S/4HANA, as shown here: In SAP S/4HANA, MRP areas have to be created for every subcontractor; if MRP areaspecific material master records dont exist, MRP uses default planning parameters. Alerting is not available for unauthorized users, Right click and copy the link to share this comment, 645119 Problems for subcontracting using delivery, 338119 Goods receipt in inbound delivery for SC order, 654613 Batches and goods receipt for inbound delivery for provision of materials for subcontract order, 1397948 Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1, 1397948 - Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1. Configuring intercompany sales. Use transaction MIGO to provide components to the subcontractor. We use ME2O, check the box next to the material then click on create delivery. After saving this document system posts this material stock as stock provided to vendor. Adding this value will open up the Components button located on the item Material Datatab. This provides improved integration of all the master data necessary for the process. You can have it without BOM by entering all the components manually. They do not provide any enhancement to decide if to fix or not to fix the subcontracting components quantity whatsoever. Explore ABAP, FICO, SAP HANA, and more! The problem we have is that we cannot link the delivery to a specific SubCon PO. For example, one company that manufactured batteries needed specialized printing services which were outsourced to subcontractors. Procurement should be done in such a way that materials are ordered in correct quantity, with a proper value at the proper time. SAP MM Procure To Pay Architect (must be good in PP too) Starts 3/13 (or 3/15); duration: 3 + months Location: remote and onsite in Denver, CO - MST hours (local or west coast candidates preferred) They sent a DESDAV / DELVRY07 message and it creates an inbound delivery in your system. How to edit personnel no. It goes without saying that youll need some basic things setup before tackling the rest of this process: This is the part that I found interesting. Thanks. 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. Be aware of this nuance when implementing electronic communication of inbound deliveries in subcontracting scenarios. Thanks for visiting. the issue of components which we provided to the Subcontractor is triggered to 543 Movement type In previous versions of SAP ERP, component materials to be provided to the subcontractor could be planned as a separate stock. Many a times, more than one subcontractor is used for manufacturing at different level of BOM. Implementation of "External Material Processing using Production Orders": Develop a process in SAP to support all efforts related to External Processing using Production Orders as the method for subcontracting. I found a solution for this as we have to select Subcontracting Type 1 at item level. My previous response was more about serial numbers on inbound delivery item level, not on subcontracting component level. It will open the screenshot shown below. System automatically selects movement type 101 O (GR to SC Vendor). 2.Maintain the BOM for the material. Here i have mentioned Subcontracting vendor creation, subcon info record and BOM creation with respect to FG material. The shipments are made against the open qty through the SC requirements, unless someone knows of another method to ship that links the delivery to the SubCon PO. Delivery). Is this possible? Sir, Procurement Overview page Apps. 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. Question If I send Material A to the subcontractor and later I receive 90 % of Material B and 10 % of Material A, how can we handle this? 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. Lets start with discussing the steps that are involved in the subcontracting process in SAP. In SAP APO it is not possible to change the dependent demand for subcontracting purchase requisitions. Hello. Create/Change/Display Bill of material (BOM) App That is confirmed by the note 1397948 Subcontracting: Components cannot be provided using IDoc /SPE/IDOC_INPUT_DESADV1. The provision is a transfer posting from the unrestricted use stock to the stock of material provided to a vendor. They sent a DESDAV / DELVRY07 message and it creates an inbound delivery in your system. 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. Read on for more about the SAP Subcontracting PO Delivery Setup. 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 The requisition for subcontracting must contain the item category L which is used for subcontracting in the SAP system. The good receipt and the goods issue will be done simultaneously by the SAP system. -SUBCONTRACT-01(HALB) (Sp. Maintain subcontracting MRP areas for all subcontracting suppliers requiring provision stocks to be planned separately from requirements. using GR for Purchase order with Movement type 101. The Latest ERP from SAP. Delivery Basics like logistics defaults, pricing for freight, and partner determination have to come from somewhere. SAP Menu Path to ME21N Transaction In ME21N transaction, you need to select a Document Type and provide a Vendor as shown on the below screenshot: SAP ERP all versions ; SAP R/3 Enterprise all versions ; SAP R/3 all versions ; SAP enhancement package for SAP ERP all . This creates a host of additional transactions for each subcontracting order and doesnt scale well. Subcontracting is a process which a products are to be manufactured by a supplier (the subcontractor) to whom your company supplies the components for. Every organization acquires material or services to complete its business needs. 5 * Rating. Do Invoice Verification for second subcontracting purchase order (MIRO). I am a husband and father. As mentioned previously, the STO keys off of a Purchase Order. Create/Change/Display Procurement Info record App Not using Migo or MB1B and 542 movement type. These components are usually associated with a BOM. PR to PO Conversion/ Create PO/Change PO/Display PO/manage PO/My Purchase order App. 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. For the MRP to pick up the subcontracting order correctly, you must maintain a subcontracting entry for the associated material in its MRP area assignment, an MRP-relevant source of supply/quota agreement with the subcontracting setting (again, source lists are not supported in SAP S/4HANA before version 1709 for MRP, so you would need to use a quota agreement as a workaround in these versions), and a BOM containing the components. its plants), or indirectly (using another of its suppliers). Process Flow. Editors note: This post has been adapted from a section of the book Sourcing and Procurement with SAP S/4HANA by Justin Ashlock. We will do our best to consider your request. Now, during unloading you realize that 3 pallets are missing. It is likely to slip through tests and bite you only down the road. Some supplier relationships require you as the purchasing organization to provide the supplier with the components used in their part of the value creation. Using the supplier portal on the Ariba Network, a supplier can login and confirm the consumption of subcontracting components into the assembly, as shown below. Copyright | Create/ Change/Display Supplier App Its being processed by subcontracting vendor, convert it to semi-finish material and deliver back. We would love to hear your feedback in the comments section below. If the material is already available in the client own stock, it will be issued from the unrestricted use stock to the vendor. Now, during unloading you realize that 3 pallets are missing. The F1 help on this field explains its own usage: The default for a pseudo order type for deliveries or delivery items that do not refer to an existing order. Please also include accounting-entries screenshots. You require the subcontracting process in SAP when a companyoutsources parts of itsmanufacturing to subcontractors. ERProof SAP MM SAP MM Training Subcontracting Process in SAP. Lets take a closer look at the handoff from Purchasing to the SD Delivery. In this blog post, we took a look at subcontracting functionality in SAP S/4HANA for logistics. In general terms, subcontracting is the outsourcing ofsomeprocess to an external vendor. Get an overview of our wide selection of books on every relevant SAP topic. The system will generate a purchase order number internally. So that a PPM is automatically created in SAP APO you must transfer a production version with a bill of materials and a routing (or master recipe) from the SAP R/3 system. The invoice is posted. Theme: Baskerville 2 by Anders Noren. 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. Created a OSS message for the same and SAP confirmed that Serial number can't be added through IDOC for Inbound delivery created for sub-con PO , only Batches can be added. Plastic boxes were provided to subcontractorsand they did required printing on these boxes. If you elected to plan without MRP areas, you werent able to use the full functionality around lot sizing and were only able to order full lot sizes. However, the integration with an SAP ERP system requires at least SAP ERP 2005 with Enhancement Pack 03. I'm a career-long IT specialist with a focus on SAP for over 18 years. Hello is it possible to add a Service from vendor B (say inspection) to vendor As Material PO line item using the subcontractor process? Standard Process Flow ME21N - Purchase order creation MIGO_TR - Send components to a subcontractor It is also possible to see accounting documents that were automatically generated by the SAP system during posting of material movements. Does this sound familiar? How to manage serialized material for subcontracting repair? Keep up-to-date with SAP information and training. 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