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PP: Capacity planning at subcontractor

Former Member
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Hi Expert,

Can anyone explain me the scenario of creating capacity planning at subcontractor and including it into MRP run? I expect complete scenario. Can anyone help me out?



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Answers (3)

Answers (3)

Former Member
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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 are not sending the material outside the company and it is contactor in our company doping this operation and only service fee for completing the operation is to be paid to contactor

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 don’t want to monitor in SAP the stock with subcontractor.

If you don’t 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.

In the second case where you define external operation, see that PP02 in std sap system) is entered as a control key. Usually PP02 will not have a set up for capacity requirement posting, hence you need to do the change as below


For PP02 control key set det capacity requirement check box.

Now you define a work centre in which define all the capacity settings and scheduling parameters

While running MRP see that following parameter is set

Scheduling = 2 – lead time scheduling.

Enter the requirement and run MRP

Planned orders are created and you can see the capacity requirement for this work centre in CM01.

Former Member
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Hi Shiv,

in subcontract control key give cap. reqmt checked box ticked



Former Member
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Shiv Shankar,

Create a Work Centre for the subcontractor as a regular one. Maintain the standard value key ( Set up, M/C and Labor time ), Capapcities, Cost Centre etc.

In the material master of the one that is going to processed at subcontractor mention a unique MRP controller.

Create the PIR for the same and do the MRP run using MD01/MD02/MD03.

Please reward suitably.