Manage mold in production and selling

[Former Member]

I have a scenario like this, customer place an order (make to order) to company , as such this company needs not only produce this special item but also needs to make special mold for this item. Company will quote 2 things separately to customer – mold cost and FG items. However, customer won’t pay mold and FG separately but asking company to allocate mold into FG selling price.

E.g, mold is cost at $100millions  while each FG cost $10,000 . This customer agree to buy 1mils FG in 1 year.

As such, company will sell FG to customer at the price of $10,100. It’s because $10,000 for 1 FG + $100  of mold which came from 100mil/1mils FG

In case by the 10th month of that year, client has bought 1 mils FG in full and wants to continue buying more. The price of FG by then will be $10,000 only as the cost of the mold has been fully allocated.

Anyone have a solution to manage mold in sales and manufacturing, please help me.

Thank you

[Former Member · Accepted solution]

My initial thoughts are:-

1. SAP has material group fields in the material master for the FG which can be used to hold the "mold". Add the material group nn field into the access sequence for your normal pricing.  You can review the condition update function for when you don't need to consider the extra $100.00, etc.

2. The issue for PP is that only the first SO received requires the mold to be manufactured.  Then my suggestion is based on (1) in MV45AFZZ pop out a message on save SO that if the material group nn field has not been maintained then PO to the manufacturer needs to be created for the mold material.

I almost have the same scenario, except the mold is created separtely and before the orders arrive.

Hope it helps.

Regards

Waza

[Former Member · Accepted solution]

Thank you for your help and I have a question related to this.

By agreement between company and customer. Customer must buy 1 mil FG in 1 year.

In case customer bought 1mils FG in the 10th month of that year. My question is: how is the system know that customer had bought enough 1mils FG and automatic update the selling price to $10,000 (not include the price of mold $100.00) if they bought more than 1mils FG.

Looking forward to hearing from yours.

Regards,

[Lakshmipathi · Accepted solution]

The functionality what you had described is nothing but amortization which can be achieved.  Hope you are aware of the scaling functionality in condition record.  Make use of that.

G. Lakshmipathi

[Former Member · Accepted solution]

Hi Waza,

Could you please help me to describe more detail on your idea. As I understand, we use material group as one condition to calculate price for FG ( as my example is $10,100) if customer bought less than 1mils FG in 1 year. And using the condition update function to monitor the accumulate selling quantity of FG. Is it right?

Ex: By agreement between company and customer. Customer must buy 1 mil FG in 1 year.

From 1st month to 9th month, customer had bought 960k FG with price $10,100( cost FG ($10,000) + cost mold ($100))

In the 10th month, they place an order with 100k FG, so how is the system know the price should be that (40k with price $10,100 because it had been allocated 1mils FG as agreement, and 60k with price $10,000 (not include cost of mold))

Please help me to clarify on the issue.

Thanks & Regards,

[former_member184555 · Accepted solution]

In case customer bought 1mils FG in the 10th month of that year. My question is: how is the system know that customer had bought enough 1mils FG and automatic update the selling price to $10,000 (not include the price of mold $100.00) if they bought more than 1mils FG. 

1. Who owns the mold...the customer or the company? Are you treating it as an asset of your company?

2. Are you returning this mold to customer after delivering the complete quantity of FG?

3. What happens if the customer buys less than 1 million FG in one year? Do you charge the customer for the balance non-recovered value of the mold?

Regards,

Ravi Sankar

[Former Member · Accepted solution]

Hi Ravi Sankar,

1. Although company produce mold, customer owns the mold and they will paid money by allocate into FG sellling price (price of FG + mold cost, see my example in initial for detail). We don't treating it as our asset.

2. After delivering complete quantity FG, company will return this mold to customer. If customer want to buy more FG, company will continue using this mold, but the selling price only the price of FG (not include mold cost).

3. If customer buys less than 1mils FG in one year, company will charge the customer for the remain quantity.

if you need more infomation, please let me know and thank you for your concern.

Regards,

Eversouth

[Former Member · Accepted solution]

Dear all,

Anybody have a solution, please give an ideal.

Thanks.

eversouth