Third-Party Order Processing with Subcontracting (252)

1. Third-Party Order Processing with Subcontracting (252) SAP Best Practices

2. Purpose, Benefits, and Key Process Steps • Purpose • This scenario focuses on the combination of third-party order processing and subcontracting • Sold Products are finished by a subcontractor and sent to the customer directly by the vendor • Benefits • Reducing stock and cost, increasing efficiency • Combination of third-party process with subcontracting functionality • Handover of customer’s requirements directly to external supplier • Invoice from subcontractor based on external services • Key Process Steps • Third Party Sales Order • Convert Purchase Requisitions to Purchase Order • Shipping of components to subcontractor • Post Statistical Goods Receipt with consumption of components • Invoice verification • Billing

3. Required SAP Applications and Company Roles • Required SAP Applications • Enhancement package 5 for SAP ERP 6.0 • Company Roles • Sales Administrator • Warehouse Clerk • Accounts Receivable Accountant • Purchaser • Purchasing Manager • Billing Administrator • Accounts Payable Accountant

4. Detailed Process Description • Third-Party Order Processing with Subcontracting • The system automatically creates purchase order requisitions for subcontracting based on a third-party order in the Sales Order (SD-SLS-SO) component and passes on the necessary information (such as delivery address) for shipping to the end customer. • A buyer validates the accuracy of the purchase requisition and converts it into a subcontracting purchase order. The sub-contracting components are sent out with a outbound delivery via Subcontracting Cockpit . • The vendor sends a shipping notification. After that a statistical goods receipt is posted. The consumption of sent components is recorded upon receipt of the value-added finished material. • The vendor sends the invoice for the services provided which is paid during the normal payment cycle. • The incoming invoice from the vendor updates the billing quantity, so that the customer-billing document can only be created after entering the invoice from the vendor.

5. Process Flow Diagram Third-Party Order Processing for Subcontracting Sub- Contr. Send Shipping Notification/ Confirmation Drop Ship Product to 3rd Party Incoming Vendor (Subcontractor) Invoice Customer Customer Request for Material Order Confirmation Billing Document Sales Administrator Create Sales Order (Optional) Change Order Quantity Auto-generates a SC Purchase Requisition Purchasing Manager / Purchaser Display List of Purchase Requisitions to Be Assigned Convert Assigned Requisitions to SC Purchase Orders Approval of SC Purchase Orders Ware- house Clerk Create Outbound Delivery Request for SC components Post Statistical Goods Receipt for SC Purchase order incl. consumption of SC components Pick Subcontracting components Post Goods Issue into SC stock Billing Administrator Billing AR–IncomingPayment (157) Accounts Payable / Receivable Accountant AP–OutgoingPayment (158) COGS Vendor Invoice Receipt Sales: Period End Closing Operations (203) AP = Accounts Payable, COGS = Cost of Goods Sold, GR = Goods Receipt

6. Diagram Connection Legend <Function> Hardcopy / Document External to SAP Financial Actuals Business Activity / Event Budget Planning Unit Process Manual Process Process Reference Existing Version / Data Sub-Process Reference Process Decision System Pass/Fail Decision