Subcontracted service items in Procurement

In case of operation subcontracting, purchase requisitions, requests for quotation (RFQs), and purchase orders can include subcontracted service items.

These purchase objects with subcontracted services can be manually specified in Procurement, or can be generated from a routing operation or a production order in Manufacturing.

Note

From the Routing Operations (tirou1102m000) session, you can generate purchase requisitions with subcontracted services for a routing operation.

From the Production Orders (tisfc0501m000) session, you can generate purchase requisitions or purchase orders with subcontracted services for a production order.

From the Generate Subcontracting Purchase Documents (tisfc2250m000) session, you can generate purchase requisitions or purchase orders with subcontracted services,

Master data

You can specify the following master data for using subcontracted service items on requisitions and purchase orders:

Subcontracted services on requisitions
Step 1. Generating and updating subcontracting requisitions

To search for an existing buy-from business partner (subcontractor) and price for a subcontracted service, you can generate a purchase requisition from a routing or a production order. The operation for the item routing or the specific production order are linked to the generated requisition, which you can view in the Linked Requisition Line Data (tdpur2502s000) session.

As much requisition lines as possible are stored under one requisition header. Lines with the same requester, purchase office, and currency appear under one header.

When you change the required date, quantity, or peg distribution on the production order that is linked to the purchase requisition, the changes are updated to the requisition line. On requisition lines without peg distribution, you can update the quantity and quantity unit, but these updates are not automatically applied to the linked production order.

When you make changes to a routing operation that is linked to a purchase requisition, the updates are not automatically applied to the requisition line. The routing operation can be deleted as long as the requisition is not closed.

You can cancel requisitions with the Rejected or Modified status and delete requisitions with the Created status. When the requisition is canceled or deleted, a new requisition can be generated for the subcontracted service.

Step 2. Approving subcontracting requisitions

If the Submit Generated Requisitions Automatically check box is selected in the Purchase Requisition Parameters (tdpur0100m200) session, automatically generated purchase requisitions are automatically submitted for approval. Note that if this check box is selected, the purchase requisition cannot be updated before approval. Updates can be made only when the requisition is rejected by the approver.

Step 3. Converting subcontracting requisitions

An approved subcontracting requisition can be converted to a purchase order or an RFQ in the Convert Purchase Requisitions (tdpur2201m000) session.

The following are applicable for conversion:

  • If the requisition has a linked production order and a buyer found a suitable buy-from business partner and price for the subcontracted service, the requisition can be converted to a purchase order. The requisition can be converted to a purchase order only when the linked production order is already released.
  • If the requisition has a linked production order, but no suitable buy-from business partner or price can be retrieved or the price must be negotiated, the requisition can be converted to an RFQ.
  • If the requisition has a linked routing and no linked production order, it must always be converted to an RFQ and cannot be converted to a purchase order.
Note

When an RFQ is generated for a subcontracting requisition, you cannot delete the requisition if the RFQ is not yet converted to a purchase order. The production order must remain linked to the requisition until a purchase order is generated.

Subcontracted services on RFQs

When a requisition with a subcontracted service item is converted to an RFQ, the generated RFQ has the Requisition origin. The operation for the item routing or the specific production order are linked to the RFQ, which you can view in the Linked RFQ Data (tdpur1502s000) session.

When the RFQ has a linked production order and is not yet converted to a purchase order, the production order cannot be changed. On RFQ lines and response lines, the item and peg distribution cannot be changed. On RFQ lines without peg distribution, you can update the quantity and quantity unit, but these updates are not automatically applied to the linked production order.

RFQ lines that are linked to a production order must at least be converted to a purchase order. An RFQ line can be converted to a purchase order only when the linked production order is already released. RFQ lines that are not linked to a production order can be converted only to a purchase contract, or a price book.

If an RFQ line has alternatives, the link with the production order or routing is stored on alternative 0. The origin for the alternatives is Manual and no linked data is available. If the RFQ line has a linked production order, only one alternative must be converted to a purchase order. Other alternatives can be converted to a purchase contract or a price book.

An RFQ line with the Requisition origin cannot be deleted before it is converted. When more than one alternative is available for a line, alternatives can be deleted. However, the first alternative (alternative 0) must remain.

Subcontracted services on purchase orders

Purchase orders lines with subcontracted service items can be generated from Shop Floor Control or from a converted requisition or RFQ. These purchase order lines must always have a linked production order, which you can view in the Purchase Order Line - Linked Information (tdpur4502s000) session.

The Subcontracted check box is selected for these lines in the Purchase Order Lines (tdpur4101m000) session.

In general, the generate and update process of purchase orders lines with subcontracted service items is similar to the applicable process described earlier for purchase requisitions.

Subcontracting prices

When a requisition is generated from SFC and the Source of Price field is Subcontracting Rate in the Items - Purchase (tdipu0101m000) session, the subcontracting rate is stored as a purchase price on the requisition line. When the requisition is converted to a purchase order, this purchase price is also stored on the order line and no discounts will be retrieved. If the Source of Price field is Price Book / Contract, no price is defaulted on the requisition line. When the requisition is converted to a purchase order, a purchase price and discounts are retrieved for the purchase order line.

For RFQs, the requisition line price is stored as Estimated Price in the Request for Quotation Lines (tdpur1502m000) session. When a requisition (with or without price) is converted to an RFQ, the requisition line price is overwritten by the price and discounts that are returned by the bidders on the RFQ.

Subcontracting origins

A requisition, RFQ, or purchase order line with a subcontracted service item, can have these origins:

Purchase objectAvailable originsExplanationLinked object(s)
RequisitionRoutingGenerated from a routing operation.Routing operation
SFCGenerated from a production order.Production order
ManualManually specified subcontracted service.-
RFQRequisitionGenerated from a converted requisition with the Routing, SFC, or Manual origin.Routing operation, or production order, requisition.
ManualManually specified subcontracted service.-
Purchase orderSFCGenerated from a production order.Production order
RequisitionGenerated from a converted requisition with the SFC origin.Production order, requisition
RFQGenerated from a converted RFQ with the Requisition origin.Production order, RFQ