What is subcontractor in SAP SCM-APO-PPS - Production Planning and Detailed Scheduling?

SAP Term: subcontractor

• Component: SCM-APO-PPS

• Component Name: Production Planning and Detailed Scheduling

• Description: Vendor who manufactures an ordered product for an ordering party, for whom required components are to be provided by the ordering party or a third party. In subcontracting, these components are called products to be provided. Once production is completed, the subcontractor sends the ordered product back to the ordering party, who then uses the ordered product as a component for the finished product.

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• Key Concepts: 
  Subcontractor is a term used in SAP's Production Planning and Detailed Scheduling (PPS) component of the Supply Chain Management (SCM) application. It refers to an external supplier or vendor that provides goods or services to a company. The subcontractor is responsible for producing parts or components that are then used in the company's production process. 
  
  How to use it: 
  In SAP PPS, subcontractors can be used to outsource certain production tasks. This allows companies to focus on their core competencies while still meeting customer demands. To use subcontractors, companies must first define them in the system and then assign them to specific tasks. The subcontractor will then be responsible for producing the parts or components needed for the production process. 
  
  Tips & Tricks: 
  When using subcontractors, it is important to ensure that they are reliable and able to meet deadlines. Companies should also consider the cost of using subcontractors and compare it to the cost of producing the parts or components in-house. This will help ensure that the most cost-effective solution is chosen. 
  
  Related Information: 
  For more information on using subcontractors in SAP PPS, please refer to the official SAP documentation. Additionally, there are many online resources available that provide tips and best practices for working with subcontractors in SAP PPS.