Inventory and Production BOM vs SubContracting BOM

Question

I am looking to convert a raw material to a subassembly part, via a purchased service. In this case, we have inventory on hand of a raw item, that is then shipped to a vendor, modified by a service they provide, and then it is shipped back and is now a different part id. Is the best way to accomplish the appropriate tracking of inventory and the purchased service, by using a subcontract BOM or Production BOM?

Julien Patureau · Answer

Hi JShea 
 If you are using the Manufacturing module already, I would favor using Production BoM and work orders. Even if both flows are very similar, I'd favor work orders because they are more flexible (allowing to mix internal operation and subcontracted operation -even multiple subcontracted operations within the same work order-). When using MRP and Standard cost calculation, you need to pick which BOM you are using ( subcontract BOM or Production BOM), this might lead to some iterations when using both types of BoMs. Another benefit is: you don't need to implement or train your end-users on new functions. Of course, you need to create a routing but with generic routing you only need it for each different subcontracted service. 
 The key reasons to use subcontracting BoM (personal view) are: 
 
 If Manufacturing is not sold or implemented 
 If need of inter-company subcontracting (the subcontractor is another site or company of the group using Sage X3) 
 If your subcontract invoice you the service and components provided in different lines 
 
 I hope this will help but I guess the best is to test now.

Sage X3

Inventory and Production BOM vs SubContracting BOM

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