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Subcontracting overview

Subcontracting selected operations to a vendor is common in many manufacturing companies. Subcontracting can be a rare occurrence or an integral part of all production processes.

Note

Subcontracting is a Microsoft-published extension. You can install it from the Extension Management page or get it from Microsoft Marketplace. Learn more in Set up subcontracting.

Basic subcontracting tools

The following tools are available without the Subcontracting app:

  • Work centers with an assigned vendor. You can set up a work center that is associated with a vendor (subcontractor). You specify this subcontract work center on routing operations, and the cost of the operation can be designated at the routing or work center level. Learn more in Set up subcontracting.
  • Work center cost based on units or time. You can specify whether costs for the work center are based on production time or a flat charge per unit. Although subcontractors commonly use a flat charge per unit, Business Central can handle both options.

Extended capabilities in the Subcontracting app

The following sections outline the extra capabilities that the Subcontracting app offers.

Subcontracting worksheet

Use the subcontracting worksheet to find production orders with material ready to send to a subcontractor and automatically create purchase orders for subcontract operations. Learn more in Order subcontracting.

Order subcontracting from production orders

Create subcontracting purchase orders directly from released production order routings. You don't need to use worksheets or other journals, which reduces the risk of errors when you verify purchase invoices. Learn more in Order subcontracting from production orders.

Subcontractor prices

Store prices from subcontractors and view all item prices at a glance. You can use filters to search for specific prices. Learn more in Manage subcontractor prices.

Component management

Component supply methods control how to handle components. For example, whether the subcontractor purchases them, they're already stocked at their location, or transferred from your warehouse. Business Central automatically manages locations and supports transfer orders for moving materials. Learn more in Manage components in subcontracting.

Item charges

Assign other costs such as transport, packaging, or other incidental costs directly to subcontracting operations. Item charges enable precise cost allocation to production orders. Learn more in Assign item charges to subcontracting receipts.

Location management

Business Central automatically assigns and manages locations in subcontracting, from provisioning components to transferring them to the subcontractor. Learn more in Set up locations for subcontracting.

Role center navigation and cue tiles

The Subcontracting app adds navigation entries and activity cue tiles to several role centers so you can access subcontracting features without searching.

The following role centers include a Subcontracting navigation group with links to the subcontracting worksheet, purchase orders, and transfers:

  • Production Planner
  • Manufacturing Manager
  • Shop Supervisor
  • Purchasing Manager
  • Purchasing Agent

The following activity pages show subcontracting cue tiles:

Cue tile Description
Subcontracting Purchase Orders The number of open purchase orders that are subcontracting orders.
Outstanding Subc. Purch. Lines The number of outstanding subcontracting purchase order lines that haven't been fully received.
Total Subc. Purchase Lines The total number of subcontracting purchase order lines.
Transfers to Subcontractor The number of transfer orders to subcontractors.
Returns from Subcontractor The number of transfer orders that are returns from subcontractors.

Set up subcontracting
Order subcontracting
Manufacturing
Setting Up Manufacturing
Purchasing
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