Subcontracting in manufacturing is the transfer of certain production duties to third-party vendors or subcontractors. These duties could include developing specific components, assembly procedures, or entire product lines.
Subcontracting allows businesses to supplement their own production capabilities by accessing outside expertise, resources, and capacities.
In today's fast-paced manufacturing industry, firms frequently rely on subcontracting to optimize operations, boost productivity, and efficiently meet consumer needs.
Odoo 17, a complete and integrated business management software, has powerful capabilities for managing subcontracting operations in its Manufacturing module.
This blog will look at the difficulties of subcontracting in Odoo 17 manufacturing, including its features, benefits, implementation stages, and potential pitfalls.
Steps to Setup Subcontracting in Odoo 17
To create a bill of materials for subcontracting a product, begin by selecting "Wood Panel" for subcontracting.
Go to the manufacturing module and click configuration, then settings. Within the choices, select subcontracting and check the box. Save the settings to apply the changes.
When you enable the Subcontracting option, you gain the ability to outsource the production of specific products.
Let us establish a Bills of Materials type specifically for subcontracting a 'Office Lamp'. To begin, navigate to the Bills of Material menu under the Products tab and select the New symbol. Enter information about the Office Lamp product, such as version and quantity.
To subcontract this BOM, simply enable the Subcontracting field. This functionality allows subcontractors to accurately determine the required product quantity.
Next, choose a subcontractor from the available list, being sure to select your company from the options provided. This guarantees smooth coordination, as demonstrated in the accompanying screenshot.
Users can quickly send raw materials to subcontractors by going to the Components page and clicking "Add a line." After you've inserted all of the components, remember to save your modifications.
To refill supplies from subcontractors, users must issue a purchase order. Return to the Odoo 17 Purchase module and begin the procedure by selecting the New icon from the Request for Quotation box.
In the following screen, select the subcontractor 'Azure Interior' as your vendor and add the required materials from the Product tab, as shown above.
Odoo 17 allows you to rapidly complete the purchasing order process and swiftly finalize the purchase order, while also seamlessly automating all subcontracting procedures.
Traceability
The traceability feature ensures that the components supplied by subcontractors are recorded. The receipt includes the relevant serial or lot numbers.
To access the Record Components, simply click the Receive Product icon from the Request for Quotations box, as shown in the screenshot below.
After clicking "Record Components," input the items' Lot/Serial Number in the new dialogue box, as seen in the screenshot below.
If the finished product's lot number has already been tracked, it is also recorded for audit reasons.
To view the recorded Lot number on the receipt, select the "Subcontracting" icon located below the product's right end, as shown in the accompanying screenshot.
Automatic Replenishment of Subcontractors
Return to the Odoo 17 inventory module after you’ve enabled subcontracting in the Odoo 17 manufacturing module.
Proceed to the products tab and select your favorite product. Locate the Routes fields in the inventory page’s Operations section.
Routes are classified into numerous types, including Buy, Manufacture, Resupply subcontractor on Order, and Others.
To automate the provision of raw materials to subcontractors, enable the Resupply Subcontractor on Order option.
This step is important when sending raw materials to your warehouse for subcontracting, as illustrated in the screenshot below.
When supplies are obtained from a vendor, the Buy route can be enabled.
Users can also select the Dropship subcontractor on Order option, which allows vendors to resupply subcontractors directly.
To enable this option, ensure that the Dropshipping feature is enabled in the Odoo 17 Purchase module.
Navigate to the Settings menu on the Configuration tab, and the Logistics Section will appear at the bottom of the window, as seen in the screenshot.
Enabling the Dropshipping option allows users to request that merchants deliver things directly to them. When the Buy route is not selected, a dropship route is initiated.
Users can also monitor raw material inventory at the company’s various subcontracting locations. To support this, enable the Storage Locations feature in the Odoo 17 Inventory module.
Simply turn on the Storage Locations field in the Warehouse section of the Settings window, as shown in the screenshot.
Enabling Storage Locations allows you to quickly track the whereabouts of products in your warehouse.
This feature makes it easy to see current stock in the Subcontracting location window. In the Configuration tab of Warehouse Management, navigate to the Locations menu.
Manual Replenishment
The Odoo database enables for the manual replenishment of subcontractors when the subcontracting field is enabled in the Odoo 17 Inventory module, users will see the Resupply Subcontractor option.
Select this option if you need to send raw materials to your subcontractor.
In the new box, click the New icon and pick your items' delivery address.
Next, choose an option to send to subcontractors.
Subcontracting is important in modern manufacturing operations because it allows companies to gain flexibility, obtain specialized skills, and optimize production processes.
Odoo 17 Manufacturing provides a solid basis for successfully managing subcontracting operations like order creation, supplier administration, production monitoring, and quality assurance.
Businesses can use Odoo 17 services features and functions to improve subcontracting operations, drive operational excellence, and achieve long-term success in today’s competitive market.
