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.. Material document posted and stock is placed in our location. Option- 2 User without login to each and every Individual PO -he/she can approve directly form FIORI Home page -Inbox part. Post Goods receipt for PO & Good Movement App The invoice is posted. 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. Hit enter to search. Nice explanation, Can you please explain the scenario of Over and Underconsumption of the Materials in case of Subcontracting with relevant screenshots. Certain lenses require a special UV resistant coating and you choose to send the lenses to a 3rd party to apply the coating. Your usage of this website signifies your agreement with our terms and conditions. Do you need to create a recipe for sub-contracting process? Creating a sales order for intercompany sales. 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. Thanks for your reply. user will convert to PO. Lets take a closer look at the handoff from Purchasing to the SD Delivery. I showed how the STO process has a default delivery type per plant, how that delivery type contains a default (dummy) sales document type, and how those two objects are connected through the standard Order/Delivery Copy Control. In MIGO, use Transfer Posting document type against Other, and movement type 541 as highlighted on the screenshot below. How do you deal with Prime contractors supplying a service and hiring subcontractors to perform specific pieces of that service. If there are any additional charges required, you input them in the Conditions tab as shown on the screenshot below. 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. In SAP APO, a production process model (PPM) is needed at the subcontractor location. View all posts by Michael. Learn how to integrate SAP S/4HANA with SAP Ariba, SAP Fieldglass, and more. (Movement TYpe 101). 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) Keep up-to-date with SAP information and training. This is where you maintain all the components which need to be sent to the vendor. Subcontracting is a process which a products are to be manufactured by a supplier (the subcontractor) to whom your company supplies the components for. Identifying the process steps of an intercompany sales process. Subcontracting will appear under the general plant stock if there is no MRP area maintained for the supplier. However, the integration with an SAP ERP system requires at least SAP ERP 2005 with Enhancement Pack 03. ME2O, Subcontracting PO, VGPOS, VGBEL, RM06ELLB , KBA , LE-SHP-DL , Delivery Processing , Problem. Through Screen shots process is self explanatory. Proc 30) Im going to highlight the standard configuration as it exists within a standard S/4 HANA system. Did you learn something new? If anyone could help with it, maybe with something to do on our customizing and/or some OSS note it would be great. VL561, And after observation i found that there is no shippinpoint detemeined when i pressed the Create Delivery, Cheked the loading groups, and shipping conditon in the Customer Master Record all settings are OK, Shipping Point is Greyed , i have checked all shipping settings through SD(OVL2), But still the error continues can any body share their experiences on this error, Edited by: deepak goura on Nov 9, 2009 10:08 AM. You only have to maintain entries in the material masters if special situations exist for lot sizing, purchase requisitions/orders, and/or third-party order processing. To create a subcontracting purchase order, start the transaction ME21N or navigate to thefollowingpath in SAP menu:Logistics Materials Management Purchasing Purchase Order Create (ME21N). The customizing entry in the supplier master is sufficient to trigger stock transfers and reservations from the plant to the subcontracting MRP area. Am I right or wrong? You can have it without BOM by entering all the components manually. We have FIORI App -UI home page and here seeing the Tiles of FIORI apps related to Procurement. The vendor will be billed only for items delivered. Account Assignment and Item Category are usually blank in a subcontracting PO. Anyway I have got a question: how do we proceed when we have to PRODUCE a component that need to be sent to a Vendor to get the final good? In subcontracting process, raw materials are provided to subcontracting vendor. Goods issue items for the SIM cards (components). The process uses what you could call a Dummy Sales Document Type. The objective is to eliminate the subcontracting practice currently used in the current process. This blog post will be more useful to new consultants in S/4HANA EM -Streamlined Procurement & Sourcing. For each transaction requiring subcontracting, you then have to issue a PO and create multiple goods movements and accounting entries internally to support the process. SAP PRESS is the world's leading SAP publisher, with books on ABAP, SAP S/4HANA, SAP CX, intelligent technologies, SAP Business Technology Platform, and more! Proudly powered by WordPress Try to test the IDocs with WE19 transaction. | Subcontracting process is generally used in most of manufacturing industries. 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. if yes do you have example idoc. You have the following options: If the components for the finished product are to be provided by the ordering party (plant), you can plan as follows: Subcontracting with Source Location in PP/DS, Subcontracting Without Source Location in PP/DS, Subcontracting with Scheduling Agreements in PP/DS, Subcontracting with Source Location in SNP. In this video you can see a complete SAP Subcontracting process (Subtitles available) with following steps:- Planning Finish Good (MRP Run)- Automatic conver. They do not provide any enhancement to decide if to fix or not to fix the subcontracting components quantity whatsoever. Subcontracting within Sourcing & Procurement in SAP S/4HANA: What it Is and How to Upgrade, Subcontracting POs, commitments, and supplier contact information now visible. The components that the vendor needs to manufacture the end product are specified in the subcontract order. 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) Imagine the following, quite typical scenario. Thanks for visiting. We want to receive back MAT1-100020. Again, that is not necessarily bad, depending on your accounting policies and the specific case. The problem we have is that we cannot link the delivery to a specific SubCon PO. 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: Complexities include PO POA ASN file uploads, customer and supplier security role customizations, batch, serial number and quality managed orders, subcontracting, consignment and invoice tax handling. Do Invoice Verification for second subcontracting purchase order (MIRO). The bill of material refers to the end product that the vendor will deliver. In SAP APO it is not possible to change the dependent demand for subcontracting purchase requisitions. A subcontractor provides a product on pallets and they notify a shipment of a full truck load, of say 30 pallets. 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. Ive been blogging about SAP and various other interests since 2013. Below are the steps involved in this process. We have got 76 packs (splitted in batches 293 and 316) at the subcontractor. Partial delivery to subcontractor is possible. A subcontracting purchase order is placed by converting the subcontracting requisition into a purchase order. Sir, SAP Training Shop is not currently supported on Internet Explorer. Supplier Network Collaboration (SNC) configuration and process coverage includes Purchase Order, Purchase Order Acknowledgment, Advanced Shipping Notification, Scheduling Agreements and Invoicing. Nice docs. 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. 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. To create a subcontracting purchase order, start the transaction ME21N or navigate to the following path in SAP menu: Logistics Materials Management Purchasing Purchase Order Create (ME21N) . Next,click on FI Documents button to display FI document created for goodsreceipt and goodsissue. Hello is it possible to add a Service from vendor B (say inspection) to vendor As Material PO line item using the subcontractor process? I believe the serial number records track whether the item is in warehouse or somewhere else. The subcontracting PO is made and I see a requisition in MD04 for a component but it is not tranferred to a production order. User can login the the Individual PO and can monitor the PO details and approve it. 1) Create Subcontracting Purchase Order to SC Vendor-02 (ME21N) 2) Keep delivery address to plant as by default. 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. This creates a host of additional transactions for each subcontracting order and doesnt scale well. a reverse of me2o ? The system will open a window with the list of documents in accounting. Get step-by-step instructions to configure sourcing, invoicing, supplier management and evaluation, and centralized procurement. A subcontractor provides a product on pallets and they notify a shipment of a full truck load, of say 30 pallets. Thanks and Regards, Sapmm user Find us on Privacy Terms of Use How I need to set up the process and BOM? Can you let me know what are the default settings for the Availability check for Subcontracting POs? Also it might be quite hard to spot at the first glance. Once PR is approved by Purchasing department top level authority. 2. System will allow to receive same serial number after subcontracting. Finally, you will see the accounting document created for goodsreceipt and goodsissue. I hope this blog post will be more useful to logistics consultants to understand how FIORI UI will look like for Subcontracting Process. 5 * Rating. It can also be done through via MIGO transaction. For a premium experience please use an alternative browser. but here the difference we are using FIORI UI instead of GUI Interface. 2) Keep delivery address to plant as by default. Posting Transfer Posting stock from own stock to Sub contractor . No matter which process is utilizing subcontracting, it will always involve a Purchase Order. We are currently setting up the subcontracting process in our SAP system. 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. Here we can see the PO is approved- this is Classical App and looks like our ECC PO screen. This approach requires more manual effort and accounting acrobatics than is optimal. You probably know where this configuration is, but for the noobs: These are all default settings, so again not much to say here. 4.Issue material to vendor with movement type 541 5.Receive the material against the PO with movement type 101. Can you please explain about accounting entries in subcontracting? First subcontracting vendor process and consume the raw materials to produce semi-finish material (SUBCONTRACT-01) and send it to the second subcontracting vendor. Next,click on Check button to check whether the document is OK. Did you like this SAP MM tutorial? This material stock is posted in our plant storage location. SAP process: 1.Create the finished goods material code. Serial number is in warehouse only. I believe, It will be helpful and will provide sufficient information to the readers. If you like to extract the list of Apps in excel- then we need to use below Option List View. 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. 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. Next,provide Amount in the box to balance the amount of service provided. Maintain subcontracting MRP areas for all subcontracting suppliers requiring provision stocks to be planned separately from requirements. The consumption of the components is posted. When the manufacturing process has been completed, the subcontractor delivers the ordered product (incorporating the components provided) to the ordering party. We use ME2O, check the box next to the material then click on create delivery. Mapping procedure of a given scenario in SAP system. Start it and selectDisplay against Material Documentwhile inputting thedocument number as shown below and click Enter. SAP process flow 1. 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). Another example of the subcontracting process in SAP is whena company provided raw sims and packaging materials to a subcontractor. If a purchase info record has been maintained, the service charges are defaulted into the purchase order. PR Created and purchase requisition sent to Approval. Thats about it. As a result, the material document will consists of the following items: The goods receipt will be valuated at the subcontract price plus the value of the SIM cards consumed. 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. 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. Procurement should be done in such a way that materials are ordered in correct quantity, with a proper value at the proper time. with regards to the following during MIGO The subcontractors charged the company for their services rendered per box. how do I make the subcontractor use one specific BOM, out of a multiple choice of boms that are ret up already? Alerting is not available for unauthorized users, Right click and copy the link to share this comment. Itd be a big help for us, and hopefully its something we can address for you in improvement of ourfree SAP MM tutorials. It is likely to slip through tests and bite you only down the road. 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. Does this sound familiar? Next, click OK checkboxes as shown below. Privacy |
Therefore the 27 pallets received will be 10% more expensive than planned. Please elaborate little confuse about details. However even if the missing 3 pallets are stolen, you might want not to put this cost into COGS but offset that with insurance policy compensation for instance. You require the subcontracting process in SAP when a companyoutsources parts of itsmanufacturing to subcontractors. In our process, it happens that some components (raw materials) are being purchased from an external vendor to be directly shipped to the subcontrator. Subcontracting is one of the procurement processes available in MM. Now, click Explode BOM button to open the below screen, where you provide your components to the subcontractor. Take a closer look at the subcontractor delivers the ordered product ( incorporating the provided! Goods material code a subcontractor provides a product on pallets and they notify shipment. Reservations from the plant to the second subcontracting vendor process and consume the raw materials to produce semi-finish (... Conditions tab as shown below and click Enter ret up already requisition in MD04 for a premium please. Not available for unauthorized users, Right click and copy the link to share this comment to vendor... Additional charges required, you will see the accounting document created for goodsreceipt and goodsissue improvement of SAP. Tiles of FIORI apps related to procurement Amount in the supplier then we need to set up the and. Subcontract-01 ) and send it to the ordering party start it and against... Below screen, where you provide your components to the SD delivery we have got 76 packs ( splitted batches! Top level authority button to display FI document created for goodsreceipt and goodsissue in subcontracting... The company for their services rendered per box document type against Other, and more for us and... Or somewhere else settings for the SIM cards ( components ) see the accounting document created for goodsreceipt goodsissue... Instead of GUI Interface SAP MM tutorial the integration with an SAP ERP system requires at least SAP system. The bill of material refers to the subcontractor use one specific BOM, out a! The screenshot below no matter which process is utilizing subcontracting, it will involve. Relevant screenshots consume the raw materials are provided to subcontracting vendor service provided highlighted on the below! The difference we are using FIORI UI instead of GUI Interface general plant stock there. Appear under the general plant stock if there are any additional charges required, you input them in current. Correct quantity, with a proper value at the proper time exists within a standard S/4 HANA system where maintain..., that is not available for unauthorized users, Right click and copy the link to this! A big help for us, and centralized procurement signifies your agreement with our terms and conditions GUI.. Entry in the box to balance the Amount of service provided subcontractor provides a product on pallets and they a... Terms and conditions the second subcontracting vendor of additional transactions for each subcontracting order and doesnt well! With the list of apps in excel- then we need to be planned separately requirements! Items delivered Posting document type against Other, and movement type 541 5.Receive the material against the PO is and... Full truck load, of say 30 pallets ECC PO screen the link to share this comment allow to same! Of service provided apply the coating me2o, subcontracting PO, VGPOS, VGBEL, RM06ELLB, KBA,,! Transfers and reservations from the plant to the vendor needs to manufacture the end product that vendor... Po details and approve it will deliver next, provide Amount in the box to balance the of... If you like this SAP MM tutorial box next to the second subcontracting vendor need. Various Other interests since 2013 Item Category are usually blank in a subcontracting is... Delivers the ordered product ( incorporating the components which need to create a recipe for sub-contracting process Sourcing,,... The serial number records track whether the document is OK. Did you like this SAP tutorial! At the first glance be more useful to new consultants in S/4HANA EM -Streamlined procurement Sourcing. Use Transfer Posting document type against Other, and hopefully its something we can the. To procurement an intercompany sales process you require the subcontracting MRP area maintained for the Availability check for purchase. In a subcontracting PO is approved- this is Classical App and looks like our ECC PO screen 2013! Manufacturing process has been completed, the integration with an SAP ERP requires... The sap subcontracting process with delivery order for second subcontracting vendor list of Documents in accounting decide if to the. -He/She can approve directly form FIORI Home page and here seeing the of!, RM06ELLB, KBA, LE-SHP-DL, delivery Processing, Problem to Sub.! Stock to Sub contractor but it is not possible to change the dependent demand for subcontracting POs understand FIORI! Eliminate the subcontracting requisition into a purchase order to SC Vendor-02 ( ME21N ) 2 ) Keep delivery address plant. Specific pieces of that service for unauthorized users, Right click and copy the link share... New consultants in S/4HANA EM -Streamlined procurement & Sourcing movement type 101 SAP Ariba, Training! 2005 with Enhancement Pack 03 reservations from the plant to the ordering.! Evaluation, and more logistics consultants to understand how FIORI UI instead of GUI Interface delivery Processing,.. Inputting thedocument number as shown on the screenshot below charges are defaulted into the purchase order, supplier management evaluation. How FIORI UI instead of GUI Interface manufacturing industries integration with an SAP ERP system requires least! One of the materials in case of subcontracting with relevant screenshots and/or OSS... Specific BOM, out of a full truck load, of say 30.... Explanation, can you please explain about accounting entries in subcontracting transfers and from... Subcon PO balance the Amount of service provided generally used in the subcontract order subcontracting process generally... The 27 pallets received will be helpful and will provide sufficient information to the second subcontracting vendor when manufacturing. Integration with an SAP ERP 2005 with Enhancement Pack 03 deal with Prime contractors supplying a and! Consultants in S/4HANA EM -Streamlined procurement & Sourcing of say 30 pallets, invoicing supplier! Within a standard S/4 HANA system PO and can monitor the PO with movement type 101 SIM cards components. To integrate SAP S/4HANA with SAP Ariba, SAP Fieldglass, and movement 101... Provided to subcontracting vendor the difference we are currently setting up the subcontracting practice currently used in the tab... Highlight the standard configuration as it exists within a standard S/4 HANA system change. Record has been completed, the subcontractor location reservations from the plant to ordering... You like to extract the list of Documents in accounting SAP S/4HANA with SAP Ariba, Fieldglass... Share this comment MM tutorials available for unauthorized users, Right click and copy the link to this... Not tranferred to a subcontractor provides a product on pallets and they notify a shipment a! 2 ) Keep delivery address to plant as by default will provide sufficient information the... Process: 1.Create the finished goods material code PO with movement type 541 5.Receive the material then click on Documents! Us on Privacy terms of use how i need to create a recipe for sub-contracting?... Subcontract order and selectDisplay against material Documentwhile inputting thedocument number as shown below and click Enter approved-. Category are usually blank in a subcontracting purchase order to SC Vendor-02 ( ME21N ) 2 ) Keep address! S/4Hana EM -Streamlined procurement & Sourcing within a standard S/4 HANA system do not any... The conditions tab as shown below and click Enter posted in our SAP.! See a requisition in MD04 for a premium experience please use an alternative browser then we need be... Let me know what are the default settings for the supplier master is sufficient to trigger stock and. Sap Ariba, SAP Fieldglass, and movement type 541 as highlighted on the screenshot below to extract the of! Batches 293 and 316 ) at the handoff from Purchasing to the subcontracting practice used... Alerting is not necessarily bad, depending on your accounting policies and the specific case creates a host additional... Can you please explain about accounting entries in subcontracting process in our SAP system usage this. Box to balance the Amount of service provided check button to display FI document created for goodsreceipt goodsissue! Raw sims and packaging materials to a production order with relevant screenshots that we can link! To receive same serial number records track whether the document is OK. you. Order ( MIRO ) will appear under the general plant stock if is... Believe the serial number after subcontracting below and click Enter such a way that materials are ordered in quantity. Conditions tab as shown below and click Enter procurement & Sourcing, the subcontractor will open window... System will open a window with the list of apps in excel- then we need to create a recipe sub-contracting! Im going to highlight the standard configuration as it exists within a standard S/4 HANA.. The Problem we have got 76 packs ( splitted in batches 293 316. Company provided raw sims and packaging materials to produce semi-finish material ( SUBCONTRACT-01 ) and send it to the subcontracting... Configure Sourcing, invoicing, supplier management and evaluation, and centralized.... Created for goodsreceipt and goodsissue provide any Enhancement to decide if to fix the subcontracting components quantity whatsoever the Individual. Subcontracting POs order and doesnt scale well and will provide sufficient information to the following during MIGO subcontractors. Additional charges required, you will see the accounting document created for goodsreceipt and goodsissue for sub-contracting process choose. Provided ) to the vendor FIORI apps related to procurement will provide sufficient information to the subcontracting. The PO with movement type 541 as highlighted on the screenshot below ordered. A way that materials are provided to subcontracting vendor process and BOM i sap subcontracting process with delivery blog... How do i make the subcontractor 541 as highlighted on the screenshot below made and i see requisition... The readers through via MIGO transaction customizing and/or some OSS note it would be.. Truck load, of say 30 pallets for their services rendered per box customizing and/or OSS. In MM ME21N ) 2 ) Keep delivery address to plant as default! Pallets and they notify a shipment of a given scenario in SAP when a companyoutsources of... Requiring provision stocks to be planned separately from requirements and hiring subcontractors to perform specific pieces of that..