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How subcontracting process can be handled along with the inter company proc

Scenario is aas the following:

1) Company X raises a PO with L item category (Subcontracting)

2) Company X issues material to Subcontractor = Y( and Y is our sister company in a different country)

3) Y manufactures the finished product for us

4) X receives it against the same process order

How subcontracting process can be handled along with the inter company transfer process?!!!

Former Member
Former Member replied

Hi Ahmad,

in SAP standard the cross-company code subcontracting process would look like this:


- Assign Vendor Y to plant Y in the vendor master data.

- create the components in CoCode X as valuated material. Create the components in plant Y with standardprice "0".

- etc..

1.) Create subcontracting PO in company code X, plant X and enter vendor Y as supplier.

2.) Based on this PO a sales order in plant Y should be created.

3.) Provide the components as usual to the vendor by using either ME2O or MB1B or MIGO.

4.) As soon as the components arrive in plant Y the users can post a goods receipt with movement type 501 in plant Y. As the components do not have a value in plant Y, you would only see them in the inventory overview (not in the financial area of plant Y, because the components still belong to plant X!)

5.) Plant Y consumes the (non-valuated) components and creates the finished product. This product is then shipped to plant X with reference to the sales order.

6.) When the product arrives in plant X you need to post a goods receipt with reference to the subcontracting PO. (with this step the finished product now gets in the ownership of plant X and the components are consumed automatically from plant X).


I hope this could clarify what is currently possible in an ERP standard system. If you are using our ERP DIMP system (with additional industry-specific features) there are some more functionalities available in this area...

Best regards

Uwe Pfisterer

Produkt Manager - ERP Logistics


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