External Processing Operation

[Former Member]

Hi..

i have one finish material , which having five operation. Out of five third operation (Op.30) is external processing operation . Finish material use "metal rod "as a raw material.

After creation of production order system has cretaed PR for third operation.

Now I issued the" metal rod " for the first and second operation . After processing , third operation is External Processing,but my store person not getting the material in stock .Asi issued the metal rod for start the operation.

How should i deal with this condition.

What componenets i should maintain in routing of finish material.How store peson get the stock of material.

What is ideal case fro external process operation ??

Plasehelp out

Thnks

[Former Member · Accepted solution]

Hi

Please check the control key of the work centers assigned for operation 2.

To get as stock control key - PP03 need to be maintained and for thrid operation which is externally processed control key should be PP02

Also ensure current components are allocated thru component allocation.

PP03 - Routing - in-house prod. auto. goods rct

PP02 - Routing/Ref. op. set - external proc.

Regards

Manikandan .J

[Former Member · Accepted solution]

Thnaks for reply..

what will happened if i defined this key in operation. please explain

[Former Member · Accepted solution]

please explain me again

[Former Member]

External operation in PP

When you say external operation-it has 2 dimensions

1.Whether you are sending the material outside your company and track the inventory

Or 2.you are not sending the material outside the company and it is contactor in our company premises doing this operation and only service fee for completing the operation is to be paid to contactor..in this case material movement is not recorded in SAP. Hence I will explain option 1

For first option you need to create a separate material no for product which is coming from subcontractor

Say X material  needs Y materialneeds Z material.

Now Z is given to subcontractor and he will convert it be Y and send it to you.

You produce X from Y

In this case you have production order for X and Z and Subcontracting PR-PO for Y material.

You can book the service cost to production cost centre in PO so that cost is captured in cost centre.

Second option is suitable if you donu2019t want to monitor in SAP the stock with subcontractor.

If you donu2019t what to create so may materials simple solution is as below

Create routing for X in which you define external operation. Assign the raw materials to external operation.

When we want to issue the material to first operation, we will not issue the material, rather we will transfer the raw materials to a different storage location in system. Physically we will issue to production and after first operation it will be sent to subcontractor.

Whatever we receive from subcontractor will be issue to production order using 261 movement type.

This was possible as we did not have any excise/tax implications. If it is there then you have to go for option no 1.

[Former Member]

Thanks

i think second option will be useful..

But where is the new storage location..is it negatice storage location...

[Former Member]

But in the second option you cannot send the material outside yr companies (that means you cannot represent this in SAP) Is it okay?

[Former Member]

Hi,

I hopr you must have created 5 operations in the routing and should have given ext. processing control key for the third operation.

PR is created for 3 rd operation. Convert it in PO.Send the material for ext.. procesing by doing transfer posting.After procesing at ext. party receive the material in MB31 transaction.Then carry put the balance two operations in house .This completes the process.

This surely will help you.Do not forget to reward the points.

Thanks & Regards

Ravindra

[Former Member]

will give reward points..

Tel me first ....after converting PO ...to send material to subcontractor i dont have material in stock. as i already isued during first operation.

[rupesh_brahmankar]

Hi,

Please go throuh this link,

[Subcontracting |http://www.sap-img.com/production/steps-for-subcontracting.htm]

Regards,

R.Brahmankar

[Former Member]

Hi,

In Operation sub concentrating (Ext Op) , stock of components will not be getting increased.

if u want maintain the stock details of component , create inter material code between 2 nd & 3rd Operation.

After finishing the 2nd operation issue the material(from 2nd op) to sub contractor and receive the semi finished material for 3rd OP. Inthat case u have to follow material subcontracting cycle.

Pradeep

[Former Member]

WHy dont you just create an intermediate material send it for external operation. In this scenario , you can get a new material after 1st two operation , then you can issue this material as component for the next material having the external operation , then receive this external processed material & do the remaining operations to get your finished material . This would be a much simpler approach and more easier to generate reports.

[Former Member]

Thnks for ur reply..

But i dont want to create a intermediate material..as it will be tedious and bulky master for my process.

How is the ideal scenario ??

In my case what i have to do ????