Alternate Job work Processes in SAP to suit Purchase Production & Costing

For the regular Sub contracting processes in the Mixing plants we have 3 vendors where the sub-contracting process is being performed, the SAP Standard sub-contracting processes is being followed in current practice, here the business users are facing following challenges;

The Inventory in SAP system showing as the Vendor Stock without any storage location, so at the time of physical verification of the stock it is causing the difficulties, there is no proper control for the same.
From the PP side business needs to do the capacity planning for the Outside Vendor Capacity, and accordingly the PP MRP and planned order process to be activated.
Consumption of input materials based on the FIFO basis, currently the consumption of materials done at the time of GRN but it is required to be done in the controlled manner;

Solution Approach

Three new plants to be created in System for each of the OSM (Outside Mixing) vendors

8001 : OSM1
8002 : OSM2
8003 : OSM3

The material will be issued to the SAP Virtual Plant of the Vendor by Plant to Plant transfer.
The Consumption of Raw materials will be posted in the production / process order as and when we receive the processed material from the vendor, in our own SAP system in the SAP Virtual plant of the vendor.
It is a regular PP Cycle to reflect the RM, SFG and FG accounting.
Subcontracting charges will be paid to the vendor by way of Service PO with GST in it.
Production planning team will run the capacity planning and scheduling for the outside vendor production facility
Stock of RM will be transferred to the OSM plant by way of a challan
Reconciliation of the RM sent for job work and FG received from Job worker will be done by way of report (on FIFO Basis or Batch to batch basis if batch is being followed properly)

Alternate Job work Processes in SAP to suit Purchase Production & Costing

Solution Approach

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