In subcontracting process, the subcontractor/vendor will be provided with materials (components), which he consumes to produce the finished product.

We have to create MRP area for each subcontractor, If we want to plan provision of components for individual subcontractors separately from the usual requirements.

In this blog we will be discussing about the below mentioned scenarios,

• Stock Transfer of Components to be Provided for subcontracting.
  
• Third-Party Order Processing for subcontracting.

Stock Transfer of Components

In this case, We will procure the components that are required for subcontracting from a vendor Z and then transfer the stock from the plant storage location to the MRP area of the subcontractor X.

Third-Party Order Processing

In this case, the components to be provided for a subcontractor is procured externally from the vendor Z and then it is delivered directly to the MRP area of the subcontractor X.

Scenario

We will be issuing the component RM material BW-R1003SC and BW-R1004SC to the subcontractor to produce the SFG material BW-S1001SC.

We will perform the Stock Transfer process for the Component RM BW-R1003SC and will perform the Third-Party Order Processing for the component RM BW-R1004SC.

Prerequisite Master Data Setup

• Bill Of material

Using Transaction code CS01 – Create Subcontracting Bill Of material for the SFG Material BW-S1001SC.

• Production version

Using Transaction code MM01 – Assign the Production Version with the Subcontracting BOM to the SFG Material BW-S1001SC

• Material Master – MRP Area and Special Procurement Key assignment

Maintain the special procurement key Subcontracting 30 for the SFG Material BW-S1001SC

For the component material R1003SC. Assign the Subcontracting MRP Area and maintain the Special procurement as Z4 , If Stock Transfer of Components to be Provided to the subcontractor.

In Customizing – Special procurement key Z4 is created for Stock transfer from plant to MRP area.

• Procurement type : F for External procurement
  
• Special procurement: U for Stock transfer
  
• Plant: Number of plant 1710 , to which the MRP area belongs.

For the component material R1004SC, Assign the Subcontracting MRP Area and maintain the Special procurement as 20, If the component material is externally procured with delivery directly to the subcontractor .

• Purchasing Info Record

For the SFG Material we should have a valid subcontracting purchasing info record with automatic sourcing indicator.

And for the component RM materials, we should have the standard purchasing info record with automatic sourcing indicator.

Process Flow

• Maintain the Forecast / Demand as Planned Independent requirement.

In Transaction code MD61 maintain the PIR for the SFG material BW-S1001SC at plant level.

In Transaction code MD04 , Stock Requirement List is displayed.

SFG Material

RM Material

• Material Requirement Planning

In Transaction code MD01N, MRP Live is executed.

In Transaction code MD04, Stock Requirement List is displayed.

For the SFG material BW-S1001SC Subcontracting Purchase Requisition 0010093462 is created.

For the RM material BW-R1003SC

Material Reservation 0000100166 is created for subcontracting (541 Movement type – Goods issue to subcontractor) and a Purchase requisition 0010093464 is created as we don’t have enough stock at Plant MRP Area level.

Transfer requisition 0000100166 (With respect to Material reservation) and subcontractor requirements for the purchase requisition 0010093462 are created at the subcontractor MRP Area level.

For the RM material BW-R1004SC

No MRP element is created at Plant MRP Area level.

Purchase requisition 0010093463 is created as we don’t have enough stock and subcontractor requirements for the purchase requisition 0010093462 are created at the subcontractor MRP Area level.

• Procurement of Component Raw material

For the RM material BW-R1003SC PR 0010093464 is converted to PO 4500491341 and GR at plant / storage location is posted.

For the RM material BW-R1004SC PR 0010093463 is converted to PO 4500491342 and GR at subcontracting vendor location is posted.

• Processing of Subcontracting Order

For the SFG material BW-S1001SC , The Subcontracting Purchase Requisition 0010093462 is converted to Subcontracting Purchase order 4500491343 using the transaction code ME21N.

In Transaction code ME2O, the component material are issued to the subcontractor.

For the component RM material BW-R1003SC, the subcontracting stock is Zero.

For the component RM material BW-R1004SC ,We have already received the stock directly in supplier location. So the subcontracting stock is 100.

For the component RM material BW-R1003SC, the required quantity is posted to the subcontracting vendor location after stock transfer.

Both the component RM materials BW-R1003SC and BW-R1004SC has the required stock in the Subcontractor Location.

In the transaction code MIGO, Perform Goods receipt against the subcontracting purchase order is performed.

In the transaction code MD04 – Stock Requirement List, the forecasted quantity is procured by subcontracting process.

The post S/4HANA Planning for Components to be Provided in Subcontracting Process appeared first on ERP Q&A.

In certain business scenarios, the need arises for purchase requisitions generated by Material Requirements Planning (MRP) to have delivery dates aligned with specific dates based on a planning calendar. This requirement becomes especially crucial when dealing with MRP-generated stock transfer purchase requisitions, where materials will be shipped from one plant to another based on a predefined calendar and delivery schedule.

This article will delve into achieving this functionality using standard SAP configuration. By implementing the following steps, businesses can ensure that MRP-generated purchase requisitions are scheduled to be delivered on specific dates, as per the requirements dictated by their planning calendar.

Below are the high-level steps:

1. Understanding the Business Need: First and foremost, it is essential to comprehend the specific business requirements that necessitate the alignment of delivery dates. This could include stock transfer purchase requisitions generated by MRP. Sometimes, business requires a certain ship schedule for the replenishment outbound delivery created for stock transfer orders. As SAP works on delivery schedules, fixing the delivery date and configuring the route properly is important to achieve the shipping schedule.
   
2. Configure the Lot Sizing Procedure: The lot sizing procedure is the key and brain for the whole process. The lot sizing procedure must be configured based on the delivery date.
   
3. Creating the Planning Calendar: In SAP, a planning calendar can be created or utilized to map out specific dates when deliveries are expected to occur. This is the heart of the whole process. This calendar should consider factors like weekends, holidays, and other company-specific non-working days that might impact the delivery schedule.
   
4. Linking Planning Calendar and Lot Sizing Procedure to Material Master: Lot sizing procedure and planning calendar need to be assigned to the material master at the respective plant where you want MRP-generated purchase requisitions to follow the delivery date as per the planning calendar. This linkage will enable the system to calculate the appropriate delivery date based on the predefined schedule.
   
5. Create a demand: Demand can be based on planned independent requirements or customer orders or reservation or consumption-based planning (i.e., reorder point or forecast based)
   
6. MRP Run and Purchase Requisition Generation: Once the configuration is in place, perform the MRP run to trigger the generation of purchase requisitions. During this process, the system will consider the planning calendar and lot sizing procedure to compute the delivery dates according to the established rules.
   
7. Review and Adjustment: After MRP generates the purchase requisitions, reviewing the results and verifying that the delivery dates align correctly with the planning calendar is crucial. Adjustments can be made to the planning calendar or other configuration settings to fine-tune the process.

Configuration Activities:

Step 1: Understanding the Business Need: Let’s say that the business requirement is to have purchase requisitions delivery date every Wednesday.

Step 2: Configure the Lot Sizing Procedure

SPRO IMG Path: SPRO -> Materials Management -> Consumption-Based Planning -> Planning -> Lot-Size Calculation -> Define Lot-Sizing Procedure -> MRP Lot Size (T-code: OMI4)

Create a New Lot Size (for Example, ZK) by coping Standard SAP Lot Size: PK and change Date Interpretation = 1 – Delivery Date.

Step 3: Creating the Planning Calendar (T-code: MD25)

Step 4: Linking Planning Calendar and Lot Sizing Procedure to Material Master (T-code: MM02)

Step 5: Create a demand (t-code: MD61)

I am loading the forecast/planned independent requirement using MD61 in this example.

Step 6: MRP Run and Purchase Requisition Generation (T-code: MD01N)

Step 7: Review and Adjustment (T-code: MD04)

Note: 1st purchase requisition was created on 8/9/2023 because of 7 days of purchasing department processing time.

The post Planning Calendar Driven Purchase Requisitions Delivery Date appeared first on ERP Q&A.

1. Delete all the unnecessary demand and run MRP. So that all the open planned orders will be deleted from the system.
   
2. Finish all the production bookings in MFBF, so that there’s no more cancellation. Ensure all the reprocessing records are processed successfully that are lying in MF47(if any).
   
3. Coordinate with costing team to process Overhead calculation/ WIP calculation/ Variance calculation & Settlement of the product cost collectors.
   
4. Set the deletion flag for the product cost collector in KKF6N once the cost balance is zero.
   
5. Uncheck the ‘REM Allowed’ indicator in the production version and Save the production version.
   
6. Select the required production version and delete.
   
7. Remove the REM profile, REM allowed indicator, and Action control from the material master for which REM to Discrete conversion is required.

Steps:

1. C223– Not able to delete the production version.

2. MF47– Clear the COGI/ Post processing error.

3. MF45– Clear reprocessing components: Rep.Manuf.(Cross checking)

Order settlement process

4. KKAS– WIP Calculation

Maintain below input data and click execute.

5. KKS6– Variance calculation.

Maintain below input data and click execute.

6. KK87– Actual settlement- product cost collector.

Maintain below input data and click execute.

Master data changes

7. KKF6N change – Product cost collector.

Edit> Deletion flag> Set and Save.

8. C223 or MM02- MRP4 Production version.

Uncheck Rem allowed, remove production line, click continue and save.

9. Select the relevant production version, click the delete button, and save.

10. MM02– MRP4 View

Uncheck Rep mfg, remove rem profile, remove action control, and save.

The post Convert Repetitive Manufacturing into Discrete Manufacturing Process appeared first on ERP Q&A.