Through VL31n tcode, we create the inbound delivery and the new batch for the material. Vendor shall process the item / use the item provided & supply the final item. This purchase order shows up in the ME2O transaction. Create Supplier Invoice Apps or Incoming Invoice Apps. Analytical apps related to PR, PO, GR, IV- Does this sound familiar? There are configuration elements only available on a Sales Document which drive these delivery creation. using Transfer posting Option and movement type 541. I am a husband and father. SAP MM - Procurement Process. 2.Maintain the BOM for the material. If there are any additional charges required, you input them in the Conditions tab as shown on the screenshot below. The components are then supplied to the vendor. The procuring entity may provide these components to the subcontractor either directly (using one of A good explanation of Subcontracting process for 2 level. Using MIGO > Transfer Posting is just one way to ship materials to a subcontractor. Your usage of this website signifies your agreement with our terms and conditions. Goods receipt items for the packaged SIM cards (end product) supplied by the vendor. A subcontractor provides a product on pallets and they notify a shipment of a full truck load, of say 30 pallets. 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. Essentially, this order type is the stand-in for what would be a normal order type in a standard OTC scenario. Can you please explain about accounting entries in subcontracting? Upon issuing a subcontracting PO and shipping out the components to the supplier, the buyer doesnt technically receive updates on the production of the order until the final product or subassembly with the components is shipped back from the supplier to the buyer. Did you learn something new? You cannot change the transfer Also, you need to provide Material, Quantity, Delivery Date, Plant, and Price. Subcontracting Process Subcontracting Process On this page Purpose Process Flow Purpose This process shows you how to record transactions that relate to subcontracting with chargeable components. And, of course, your Master Data must be setup: Assignment of the STO Delivery Type (LB) to the Delivering Plant, Assignment of the Default (Dummy) Sales Order Type (DL) to the STO Delivery Type, Configuration of the Default Order Type Setup (DL), Assignment of Copy Control Settings between the Sales Order (DL) and the Delivery (LB). 3.Create PO with item category as "L" . Next, click OK checkboxes as shown below. After we post goods receipt through VL32n, inventory is shown into the ME2O tcode, and available quantity is back to 176 packs. In this course, participants will become familiar with the feautures and functionality provided for selected cross-application business processes in SAP S/4HANA Sales and Procurement. Goods issue items for the SIM cards (components). We only pay the prime contractor, prime pays the subs. 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). 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. 3) Enter Net Price (Processing cost) 4) In the item detail tab,Material data click on components and Explode BOM 2 Goods receipt for first subcontracting purchase order items (MIGO) To do it, click on Doc. A typical example in manufacturing would be assembly. Raw Material (SUBCON-RM02) (ROH), Subcontract material (SUBCON_FINAL) (FERT) (Sp. 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). Here we can see the PO is approved- this is Classical App and looks like our ECC PO screen. Can you explain how to do this process without BOM?? Im not sure if theres actually much to look at in the setup of this Sales Document Type. The subcontractors charged the company for their services rendered per box. Some components also come from our warehouses. List Material document Apps Conclusion:This article explained the process scenario of Multilevel Subcontracting Process in SAP Procurement. 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. This differs from classic SAP ERP for subcontracting, in which you could plan either with or without MRP areas. Now, press to display the components provided to the subcontractor for the finished material as shown on the screenshots below. Finally, click on Post button to post the document. The process of buying materials and obtaining services from vendors or dealers is called procurement. user will convert to PO. Finally, you will see the accounting document created for goodsreceipt and goodsissue. It appears that you are limited to only one default Delivery Type per Plant. 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) Explore ABAP, FICO, SAP HANA, and more! The components are posted to the stock of materials provided to the vendor. You create a delivery for the lenses to be shipped to your vendor. 1) Post Goods Issue according to the Purchase Order number (4500000863) above. The SIM cards supplier will be instructed to deliver the raw material at the subcontractors premises. SAP Stock Transfer Order and Stock Transfer Process. Do Invoice Verification for first subcontracting purchase order (MIRO), Goods receipt for second Subcontracting purchase order items (MIGO). Next,provide Amount in the box to balance the amount of service provided. If, after the goods receipt has been posted, the vendor informs you that a larger or smaller quantity of the components was actually consumed than planned in the purchase order, you must make an adjustment. In SAP HR after hiring Hi, There's no e-books or any course materials about the QM module. (It is already delivered). Required fields are marked *. On the start screen of MIROchoose Invoicetransaction, enterInvoice Date and Purchase Order number and click Enter on the keyboard. Finally, click on Postbutton to save the invoice receipt (IR). Subcontracting will appear under the general plant stock if there is no MRP area maintained for the supplier. Is there a process to bring components back from the Subcontractor . In previous versions of SAP ERP, component materials to be provided to the subcontractor could be planned as a separate stock. Also in previous versions of SAP ERP, you could check subcontracting stocks by supplier by running reports from a specific IMG menu path. Finally Posting Invoice verification (Supplier Invoice). Now, lets display thedocument that we have just created. 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. it again depends on the user decision. Lets start with discussing the steps that are involved in the subcontracting process in SAP. Keep up-to-date with SAP information and training. Here we can see the FG and related Raw Materials. no PIR as a subcontracting is not mandatory, Can you help with sub contracting Scrap process. Unfortunately they did not. the issue of components which we provided to the Subcontractor is triggered to 543 Movement type To receive material against the purchase order, SIM cards and packaging materials need to be issued to the subcontractor. 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. Sound off in the comments. However, there is no copy control from an STO PO to an SD Delivery. For example, assume you create a subcontract order for the assembly of 10 engines. Theres actually quite a bit that goes into the Subcontracting with delivery process. Steps to perform subcontracting: Create subcontracting Info record (Optional) - T Code - ME11 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. The bill of materials (BOM) is a formally structured list of the components that make up a product. How to manage serialized material for subcontracting repair? Many a times, more than one subcontractor is used for manufacturing at different level of BOM. Really its very useful for content. 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 next step in the subcontracting process is the transfer of the repairable part together with additional components to the vendor. 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. In general terms, subcontracting is the outsourcing ofsomeprocess to an external vendor. PR creation through FIORI Apps- Create PR apps. Very useful content , Thanks for sharing with us. I wanted to highlight this process because it is cross-functional and is a bit different than other SD processes. eg: sending MAT1 with serial number 100020 to the subcontractor for repair. Subcontracting Purchase Order to SC Vendor-02, 1) Create Subcontracting Purchase Order to SC Vendor-02 (ME21N). Thank you, helped a lot. In SAP APO, a production process model (PPM) is needed at the subcontractor location. 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. 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