Manage Spares for Subcontract PO – A summary of the activity

In aviation industry, at times cost of procurement is high for some parts which can be manufactured if all the raw materials are readily available resulting in low cost in comparison to procuring the same part. Hence the provision to facilitate subcontract manufacturing in PO enables to ship the raw materials to vendor and receive the manufactured part and also returnable spares. The “Manage Spares for Subcontract PO” activity aids the buyer to subcontract the manufacturing of Parts by shipping the spares to vendor resulting in less cost comparing to the procurement of Parts.

The Subcontract manufacturing in PO facilitates the following:

• Spare parts can be identified for Subcontract manufacturing against each PO Line # (Part Level).

• Issue Spare parts and ship it to vendor against the PO document.

• Record Usage information of spares and facilitate return of unused spares.

• Ship additional spares as requested by the vendor without requiring PO approval.

• Add spares cost during receipt of manufactured parts along with the Order Cost and value in inventory.

• Shortclose PO document and receive the spares back.

• Separate Numbering type for PO spares issue.

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