Saturday, December 3, 2011

SAP MM: Subcontracting Process in SAP MM


What is Subcontracting: 

During Subcontracting Process, our company orders material from an external vendor. Unlike a normal procurement process, our company makes the components for the production of the materials partially or completely available to the vendor.
Main thing is that we ordered the finished or semi-finished goods from vendor and we provide the components for the production of this material partially or completely available to the vendor.

Subcontracting Process in SAP MM: 

  1. Subcontracting Info Record (For vendor and finished or semi finished material)-Possible but Not mandatory.
  2. Go to Purchase Order - Item Category- L
  3. Go to Purchase Order - Explode BOM (Bill of Materials) at Material Data Tab - - - Create the provided subcontracting items (Materials master record) and enter these at explode BOM.
  4. Making initial stock entries for all components by using Transaction code MIGO and movement type 561.
  5. Then provide components to vendor by using Movement Type 541+O (O is Special stock type Indicator).
  6. Save.
  7. Now Vendor provides the finished goods. Using MIGO and Movement Type 101, enter goods receipt against purchase order.
  8. Save and note down the material document number.
  9. Stock of material provided to vendor(Consumption of components only for if vendor consumes more components than provided)- - goods issue for Consumption by using Movement Type 543+O (Special stock type indicator)
  10. Subsequent Adjustment: MIGO – Subcontracting Adjustment  - Purchase Order
  11. Enter the item for which we want subsequent adjustment and enter the different quantities specified.


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