Types of Subcontracting

By Chandra

There are two types of subcontracting relevant for PP module:

  1. Operation subcontracting
  2. Assembly subcontracting.

Operation subcontracting: Within in-house production if some capacity bottlenecks exists in any operations then you can this job to some vendors to carryout this job at his premises and supply us the semi-finished part. This can be done via control key example PP02 (external processing).

Assembly subcontracting: Total product can be given for subcontracting. We have to give the raw materials to vendors and they would supply the assembly.  This can be done with special procurement type 30 with procurement type F.

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