Subcontracting in ProcurementIn Procurement, subcontracting purchase documents can be created. These types of subcontracting can be distinguished:
To start the subcontracting process, a purchase order is required. Operation subcontracting For operation subcontracting, a part of the production process (one or more operations) is subcontracted. These types of operation subcontracting are available:
Item subcontracting For item subcontracting, an item's entire production process is subcontracted. Therefore, it is always used with material flow support. Subcontracted purchase order lines can be generated:
You can always manually change the subcontracted purchase order line, purchase order line peg distribution, and the material supply lines. A material supply line's peg distribution can be updated only from the parent line, that is the purchase order line, the purchase order line peg distribution, or the material supply line. To supply the materials to the subcontractor, supply orders or schedules are generated from the material supply lines using the Purchase Order Material Supply Lines (tdpur4116m000), or the Generate Supply Orders for Subcontracting (tdpur4216m000) sessions. Consumed materials are issued from inventory and the material consumptions are updated by Purchase Control. Note
Unplanned subcontracting (operation and item) Unplanned subcontracting is applicable when you subcontract after generating a production order. For unplanned subcontracting, a purchase order is generated from the production order and the material supply lines are populated by Shop Floor Control. They are based on the estimated material lines of the original production order's subcontracted operation, which is deleted after the subcontracting purchase order is generated. For more information, refer to Unplanned subcontracting. Service subcontracting For service subcontracting, work on an item to be maintained or repaired is subcontracted. This work entails the entire repair process, or only a part of it. Service subcontracting can be used with or without material flow support. To supply material to the subcontractor, supply orders must be generated from the material supply lines in the Purchase Order Material Supply Lines (tdpur4116m000) session, or in the Generate Supply Orders for Subcontracting (tdpur4216m000) session. Consumed material is issued from inventory and the material consumption is updated by Service. Financial transactions are also generated by Service. For more information, refer to Service subcontracting in Procurement. Subcontracting purchase prices To retrieve the subcontracting purchase price, you can specify the pricing data for operation subcontracting, item subcontracting, or service subcontracting. Price determination depends on the setting of the Source of Price fields in the Items - Purchase (tdipu0101m000) session. If the Source of Price is set to Price Book / Contract for the type of subcontracting, subcontracting-specific purchase price and discounts are retrieved for the purchase order line, based on the following search logic that LN uses to retrieve pricing information:
Note For item subcontracting, the source of price is always set to Price Book / Contract. For operating subcontracting, the Source of Price can also be set to Subcontracting Rate. In this case, the subcontracting price is retrieved from Manufacturing. For service subcontracting, the Source of Price can also be Reference Activity. In this case, the subcontracting price is retrieved from Service.
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