Subcontracting to a subcontractor as a production order external operation

[AAkash1]

Hi All,

I have below scenario in MTO

Sales order is created, from which we have created a production order where we have one production operation ( external ) to send the semi finished material to a subcontractor, where a subcontractor will perform an operation and send that material to a customer directly .

Here ,do we need to maintain subcontractor as a storage location ? And from this operation, do we need to create a purchase requisition , followed by a po to capture the cost ? Will be thankful if someone can shed the light .

[Prasath]

Hello AAkash1, We would more details help you better. However I can assist as per given information,  If only one operation is involved and that can done by Supplier then I would suggest you to go with Third party sales PO and GR later you can sell it to customer directly. (Via third party sales)

Regards

Prasath

[AAkash1]

Hi Prasath, thanks for your reply. I just want to understand the standard process from SAP.

for example ,

. Sales order is created.

. Production order is created against the sales order, where in production order we have 2 operations

Operation 1 in Warehouse, Operation 2 is done by the subcontractor, we will send the material to subcontractor, receive it back and then send it to end customer. 

for example,

1. Sales order > Prod.order > Operation X(Send to Subcon), here system will create a PR automatically? 

I just want to understand the standard MTO with an operation at the subcontractor, once the material is sent to subcontractor, he will do operations and material will be changed, will there be any goods issue at the subcontractor? what would be the document etc capturing the goods issue of raw material at subcontractor? And most important is that we will be sending E - Stock to subcontractor, do we need to have a specific storage location created for each subcontractor?