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Fixed and variable cost subcontract work center

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Posted on by Hokitika

Is it possible to have a subcontract work center that has a fixed cost and variable cost for a subcontract work center? For example, a processing fee of $ 25 and then $ 1 / unit produced.

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KasparsSemjonovs 4,177 Super User 2025 Season 1 on at

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RE: Fixed and variable cost subcontract work center

Add Run time for the first routing line and then try to refresh the Production order
Hokitika 5 on at

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RE: Fixed and variable cost subcontract work center

If I refresh the production order, I get a divide by zero error when the work center with only setup time is included. This is the routing.
Jun Wang 7,681 Super User 2025 Season 1 on at

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RE: Fixed and variable cost subcontract work center

yes you can do that.
Hokitika 5 on at

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RE: Fixed and variable cost subcontract work center

Thanks for your help.

I need to create a purchase invoice for the costs. Otherwise, I would use a non-inventory item in the BOM with no work center.
Hokitika 5 on at

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RE: Fixed and variable cost subcontract work center

Is it possible to have a subcontract work center with only setup time as the fixed cost ?
KasparsSemjonovs 4,177 Super User 2025 Season 1 on at

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RE: Fixed and variable cost subcontract work center

That is a valid concern - this has to be tested - if the item is linked via Routing Links to the Subcontracting operation - then it could be that it is posted there, but I haven't tested this setup myself
Jun Wang 7,681 Super User 2025 Season 1 on at

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RE: Fixed and variable cost subcontract work center

my question on the other option is that the non inventory item cost, as a component, will not be posted to the subcontractor
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KasparsSemjonovs 4,177 Super User 2025 Season 1 on at

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RE: Fixed and variable cost subcontract work center

Processing fee can be added a purchase line on PO. You can set it up as recurring line that is automatically added to each order, but this could make it difficult, if You have several items in each order and for each You need to pay the processing fee.

Another option You can explore is that You add an Item of type Non-Inventory where cost is 25$. Then add it to the components of Production BOM and if needed You can add a Routing link - so that this Item is consumed only at the specific operation in your Routing. With this setup tricky part is regarding the consumption quantity - as You cannot specify in BOM that for each unit 1 processing has to be used, but I think You can provide that 0.00001 for each peace has to be used, and on the Item card provide Rounding precision of 1. This will work if You are not producing more than 99k finished product units in each production
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Jun Wang 7,681 Super User 2025 Season 1 on at

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RE: Fixed and variable cost subcontract work center

I don't think you could set up that on the work center level. but when user creates purchase order for subcontractor, user could add a line as an item charge for the processing fee