RE: subcontracting work to vendor
Yes, it is possible to automatically consume the parts supplied by the customer for installation when receiving the finished goods from the vendor using the warehouse management functionality in an ERP system.
One way to achieve this is by setting up a Bill of Materials (BOM) for the finished goods and including the customer-supplied parts as components in the BOM. The BOM can then be linked to the item code for the finished goods.
When receiving the finished goods from the vendor, the system can automatically generate a production order for the assembly of the finished goods. The production order will include the customer-supplied parts as components, and when the finished goods are received in the warehouse, the system will automatically issue a backflush transaction to consume the customer-supplied parts and complete the production order.
This process can be further optimized by setting up an automated replenishment system for the customer-supplied parts, such as a vendor-managed inventory (VMI) program or a kanban system, to ensure that the parts are always available for consumption during the assembly of the finished goods.
