Avoid double work orders (mixed ownership of component)



Reputable Poster
Hi all!
This company has manufacturing sites in US and in Europe.
Some components are owned by the European company but shipped directly from supplier to US and the actual manufacturing process takes place in US.
When the process is complete, the European company sells the finished product to US customer

We have suggested to use outside operations for this but it is a bit work-intensive
1. Create purchase order for component in the Europan branch with the actual costprice on PO
2. Create 0-cost purchase order in US (componen7 07-cost in US is zero) to also get the component stock to US branch

3. Raise work order in US with components in US branch only
4. Process the work order in normal fashion in US branch
4. Sell product from US company to the european company (price = labour hours + US-owned components cost)

5. Raise outside operations work order in European company with the US company as supplier for the *OP OX purchase order
6. Issue the component in European branch to the work order + receive the OX order against WO
7. Complete outside ops work order in Europe
8. Sell the product to US customer (reduces stock in European branch)

The customer would like to automate this process but i fear that automating outside operations process is going to be a very tedious task and prone to errors due to the setup requirements + exceptions (reversal of completions and issues etc.

So we are investigating if we can either
1. Only have the component in the european branch and have US branch issue the component from the european branch
2. See how the intercompany invoicing could be handled using the above
3. How to create inventory of the finished goods in the european branch or possibly use a non-stock sales, maybe direct ship order to sell it to the customer

I would like to hear from anyone who had similar requirements?

With kind regards
I would expect the best solution would be direct ship with EDI generating the required sales orders on the US company.
The above query is quite Old, just noticed that. However the above scenario can be managed through MRP Process of Multifacility planning On (R3483)
Branch Plant relationship to be defined from EU Plant to US Plant for components and from US Plant to EU Plant for FG.
When the order is placed at EU Plant, MRP will consider it as demand, and generate following messages in sequence :
1. ST-OT from US to EU Plant for FG
2. WO at US Plant for FG
3. ST-OT from EU Plant to US Plant for components.
4. OP for Child item at EU Plant from 3rd Party suppliers. If EU Plant is manufacturer then it will suggest Work Orders.

This way, it will only have one Work order and two ST-OT Orders.