Job Work --subcontracting for customer

[Former Member]

Hi

Our customer is giving us some material and asking us to do processing on it.Actually this material is the material which we have sold to them ,but now they want polishing to be done on this material ,i.e we are only selling services- (processing services) .how to carryout this scenario?

IN MM module we have a functionality called – subcontracting. Where we give materials to our vendors to process them and give them back to us in finished form.(some finished products).

But our current requirement is a reverse one. We have to take material from our customer and process them and give them back to our customer.

Is there any functionality in SD to process this kind of orders?

Plz let me know if some body has gone throug this scenario nad how it has been solved ,

points will be awarded if the answer is useful.

regds

shailesh

[Lakshmipathi]

Dear Shailesh

1) Create the Material with type UNBW

2) Do MIGO so that only stock quantity gets inwarded without any values

3) Create the BOM following regular process for the above, keeping M1 material as the 1st component

4) Confirm the service by one operation with material code M1A (material type HALB) through MFBF (Item Category Group NORM /

5) While doing PGI, stock at servicing plant will get reduced.

6) HALB being sold to manufacturing plant with no ED, Cess, Tax etc.

7) Raise an invoice (charging ONLY for service charges)

thanks

G. Lakshmipathi

[Former Member]

Hi,

Based on your requirement i can give some positive solution but one thing is in SAP there is not standard business process and it purely depends on how you map. The business process is as follows - please correct me if im saying wrong

1. You act as sub contracting vendor and called as Job work by company.

2. Customer send the Finish goods or Raw material to you for processing.

3. Receives the material to your inventory as job work material and issue the material for processing from stores.

4. Polishing the material after issued from the stores.

5. Send back the material after polishing to the customer by raising processing expenses.

If the above what you follows is write then map it as follows-

1. Create MIGO with movement type 501 (GR without Purchase Order)- receive the material into your invenroty with 0 value.

This scenario without PP module

2. Issue the material for processing from stores through MB1A with movement type 201.

3. Generate Produciton after processing through transaction MB1C.

4. Create Job Charges sales order tyhrough VA01.

5. Create delivery for the material after processing.

6. Create billing document for job changes.

7. Create EI with 0% excise duty.

Rewards if it helps

Regards

Goutham

[Former Member]

Hi,

Your profile is a mix of production and services.

So i guess you will have to divide your roles,

e.g. For Role A: you act as production base, where in you procure the material from the different customers.

For Role B: you act as service based whatever the product you have taken for changes are provided back to the same customer .

These are totally my views, not necessarily the correct one.

So please cross check these with some very experienced persons probably in the line of project managers as such.

regards,

Siddharth.