How to Handle VMI on Subcontracted Assemblies

[gstanisic]

Background:
We are currently transitioning to a Vendor Managed Inventory (VMI) model for a specific motor part that is used in two different higher-level assemblies (BOMs). One BOM will continue to use the motor we purchase directly from the manufacturer A, while the other BOM will use the same motor part number supplied directly to our subcontractor through a VMI program. Critical to note these motors are exactly the same and have the same material master.
Goal:
Our primary goal is to ensure accurate demand planning and avoid over-purchasing the motor we buy directly and send to subcontractor number 1. We need to make sure that the consumption of the VMI motor at the subcontractor number 2 is properly reflected in our SAP system so that it is considered when calculating the overall demand for the motor.
Challenges:

• The VMI motor and the directly purchased motor share the same material master and part number, making it difficult to distinguish between them in SAP. That material master is used on two BOMs. One BOM is manufactured by subcontractor A and one is manufacturered by subcontractor B.
• We need to find a way to automatically capture the VMI motor usage at the subcontractor and integrate it into our demand planning process.
  Potential Solutions:
  We are exploring the following solutions within SAP to achieve our goal:
• Consumption-Based Planning (MRP): We want to leverage MRP to calculate the overall demand for the motor based on the consumption of both BOMs. This requires accurate recording of the VMI motor usage at the subcontractor (e.g., through goods issue transactions).
• Subcontracting with Component Supplied by Vendor: We are investigating if this functionality can help us automatically track the VMI motor usage. This would involve creating a subcontracting purchase order where the vendor supplies the motor directly to the subcontractor, and the consumption is automatically recorded in SAP.
  Questions for the SAP Community:
• Has anyone successfully implemented either of these solutions (MRP or Subcontracting) to track VMI motor usage and integrate it into demand planning?
• Are there any specific configuration steps or best practices we should be aware of when setting up these processes in SAP?
• Are there any alternative solutions or workarounds within SAP that we should consider?
• Any insights or advice on potential challenges or pitfalls we might encounter during implementation would be greatly appreciated.
  We are open to any suggestions or recommendations from the SAP community on how to best achieve our goal of accurate demand planning and inventory management for this motor part.