on 04-02-2012 9:25 AM
Hi,
recently I've come across one business scenario.
Company A gets order from the customer. But actually company B supplies the required parts to the company A which assembles all the parts in the plant of Company A and delivers the goods to the customer later.
I felt, we can consider this as a regular process. Instead of manufacturing the product, we're procuring the required items from the vendors and doing delivery to the customer. Could you pls help me with your ideas..
regards
Krishna
Hello,
Are company A & B are related in some manner (like if they belong to same Corporate Group)?
If no then this is just a normal Procurement / Sales Process. Company A is buying Raw Materials & assembling them into Final Product which is sold to Customers.
Where is the exact problem you are facing?
Thanks,
Jignesh Mehta
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Hi Krishna,
the above mentioned scenario is nothing but regular process, even though company A procures material from vendor and assembles as whole product , we can still consider him as manufacturer. If the order is specific to the customer requirement with different varient then we can consider this scenario as MTO (Made to Order).
thanks
VSA
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