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Does subcontractor supply Material or Services or both?

Former Member
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234

What does a subcontractor supply? Material Only? Or Services Only? Or can a subcontractor supply BOTH Material & Services?

Accepted Solutions (1)

Accepted Solutions (1)

Former Member
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Ideal subcontracting scenario goes like this..., you supply Raw material to Subcontracting vendor.

By consuming the Raw materials provided by purchaser, the vendor provided you the finished goods.

You are paying the vendor only the service/operations charges, not for the material procured.

End of the day, you are getting a finished product from subcontractor for which you only have provided components. But you are only paying for the services

Answers (3)

Answers (3)

former_member329706
Active Contributor
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Subcontractotr supplies FG material after processing the raw components supplied by us the Raw components are maintained with BOM for final FG material in T-code CS01...................And it can be procured with item category "L" in std PO.... in ME21N (Yes material only)

Serivce based PO are created with item category as "D".. IN ME21N (Yes same vendor can be used for both) with pay service charges........

Former Member
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Yes, we can use two line item in the purchase order and carry out Service and as well as Material

Former Member
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Basically Material....but in case of repair cycle you can take service by paying him the service charge .i.e the item category will be L only but the price you will maintain in the condition tab is the service charge

Regards,

Indranil

Former Member
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Hi,

If you maintain item category as standard, it'll be a standard procurement and iten category "L" it'll be a subcontracting PO.

For the same Vendor you can make both kinds of procurement by differentiating with item category.

Umakanth R