In basic subcontracting, a company's product is produced entirely by a subcontractor. The product is first purchased from the subcontractor, who acquires their own components, manufactures the final product, then delivers the final product to the contracting company's warehouse.
The following documentation covers how to configure a subcontracted product and trigger the subcontracting process.
To use subcontracting, contractors must first configure products with a :ref:`vendor pricelist <purchase/products/pricelist>` as well as a subcontracting-type |BoM|.
The pricelist allows the contracting company to purchase the product from the vendor (subcontractor) through a |PO|, while the |BoM| allows the product to be manufactured externally by the subcontractor.
To configure a product's vendor for basic subcontracting, navigate to :menuselection:`Inventory app --> Products --> Products`. Then, select a product or create a new one.
On the product form, click the :guilabel:`Purchase` tab and add the product's subcontractor as a vendor by clicking :guilabel:`Add a line`. Select the subcontractor in the :guilabel:`Vendor` drop-down menu.
Then, enter the price of the product in the :guilabel:`Price` field.
Finally, set a :doc:`lead time <../../inventory/warehouses_storage/replenishment/lead_times>` for the product in the :guilabel:`Delivery Lead Time` field to specify the number of days for the subcontractor to produce and deliver the final product.
Note
Since contractors are only responsible for purchasing and receiving the final product, they do not need to additionally configure manufacturing lead times on a |BoM|. Instead, provide only a single Delivery Lead Time on the vendor pricelist that factors in both the subcontractor's manufacturing and delivery time.
After specifying the vendor, configure a subcontracting-type |BoM| for the product. Click the :guilabel:`Bill of Materials` smart button on the product form. Then, select the desired |BoM| or create a new one.
Tip
Alternatively, navigate to :menuselection:`Manufacturing app --> Products --> Bills of Materials`, and select the |BoM| for the subcontracted product.
In the :guilabel:`BoM Type` field, select :guilabel:`Subcontracting`. In the resulting :guilabel:`Subcontractors` field, add one or more subcontractors.
Because the components and manufacturing are both handled by the subcontractor, there is no need to list any components in the :guilabel:`Components` tab of the |BoM|.
The basic subcontracting workflow begins by :ref:`creating a PO <subcontracting_basic/workflow/create_po>` to purchase the product from the subcontractor (1).
The contractor (YourCompany) then confirms the |PO|, which creates a receipt to transfer the final product (2). The subcontractor manufactures the product and delivers it back to the contractor when done.
Once the product has been produced and received, the contractor :ref:`validates the receipt <subcontracting_basic/workflow/validate_receipt>` (5) to trigger :ref:`inventory moves <subcontracting_basic/workflow/track-inventory>` from the subcontractor to the company's stock (3, 4).
To create a |PO| for the subcontracted product, navigate to :menuselection:`Purchase app --> Orders --> Purchase Orders`, and click :guilabel:`New`.
Begin filling out the |PO| by selecting a subcontractor from the :guilabel:`Vendor` drop-down menu. In the :guilabel:`Products` tab, click :guilabel:`Add a product` to create a new product line. Select the subcontracted product in the :guilabel:`Product` field, and enter the quantity in the :guilabel:`Quantity` field.
After adding the product, the :guilabel:`Expected Arrival` field is updated with the finished product's expected delivery date, as configured earlier with the vendor's Delivery Lead Time.
Finally, click :guilabel:`Confirm Order` to confirm the |PO|. A receipt is automatically created, and a :guilabel:`Receipt` smart button appears at the top of the form.
After the order is confirmed, the subcontractor manufactures the product and delivers the finished good back to the contracting company.
To receive the finished product from the subcontractor, click the :guilabel:`Receive Products` button on the |PO|, or click the :guilabel:`Receipt` smart button at the top of the page. Then, click :guilabel:`Validate` to enter the incoming shipment into inventory.
Note
If :doc:`multi-step inventory flows <../../inventory/shipping_receiving/daily_operations>` are enabled, additional transfers must be validated to enter the incoming product into stock.
After validating a receipt, Odoo automatically generates inventory moves to track the movement of subcontracted products between locations. To view these inventory moves, navigate to :menuselection:`Inventory app --> Reporting --> Moves History`.
To track inventory movement in subcontracting, Odoo sends any product components to a dedicated Subcontracting Location. A :ref:`virtual location <inventory/warehouses_storage/location-type>` called Production then consumes the components and produces the finished good. Once produced, the good then moves back to the Subcontracting Location before finally entering the contractor's stock when the receipt is validated.
Note
Because no components are sent in basic subcontracting, there is no movement from the Subcontracting Location to the Production location.