Bramvia — Business Central Experts

Subcontracting in Business Central: how outsourced operations flow from routing to purchase order, and what changed in 2026

Send an operation — plating, machining, heat treatment — to an outside vendor and have the cost land on the production order automatically. How subcontracting works in Business Central, the routing and work-centre setup, the subcontracting worksheet, costing, and the 2026 improvements that route instructions and attachments to the vendor.

Short answer: subcontracting in Business Central lets one or more operations in a routing be performed by an outside vendor — plating, machining, painting, heat treatment, assembly — with a purchase order generated for the service, receipt of the finished operation posted as output, and the vendor's cost landing on the production order. The mechanism: a work centre flagged as subcontractor and linked to a vendor, the operation on the routing assigned to that work centre, and the subcontracting worksheet that turns released production orders into purchase orders. The 2026 release wave made it usable in more plants: routing instructions and attachments now flow to the subcontractor's purchase order, an assisted setup exists, and basic warehouse locations support it. Here's the setup, the costing, and the traps.

How it works

1. Work centre with Subcontractor No. set to the vendor. The unit cost on the work centre (or the vendor's price on the item/operation) is what the PO will carry.
2. Routing: the outsourced operation uses that work centre. Everything else stays internal.
3. Production order released. The operation is waiting.
4. Subcontracting worksheet → Calculate Subcontracts → lines for every released order with an operation on a subcontractor work centre → Carry Out Action Message → purchase orders to the vendor, one per operation, referencing the production order.
5. Ship components to the vendor if they need them (a transfer to a vendor location, or the vendor supplies its own).
6. Receive the PO: posting the receipt posts output on the production order for that operation and the capacity cost from the vendor invoice. The order moves to the next operation.

Cost lands where it should: on the production order, in the actual cost of the finished item — not in a purchase expense account nobody reconciles.

What changed in 2026

• Routing instructions and attachments go to the subcontractor PO. The drawing, the spec, the finishing notes — on the PO, not in a separate email. This was the most-requested gap.
• Assisted setup walks through work centre, vendor link and worksheet.
• Basic warehouse locations (bin-mandatory, non-directed) now support subcontracting flows without workarounds.
• Subcontractor receipts with quality inspection: with the Quality Management extension, the returned operation can trigger an inspection before it releases to the next step.

Costing

Two ways to price the service:

• Work centre unit cost — one rate for everything the vendor does on that work centre.
• Item/vendor price — a purchase price per item for the subcontracted operation, which lets the same vendor charge differently by part.

Either way, the vendor invoice posts against the PO, the variance against the expected cost shows on the production order, and the standard-vs-actual analysis picks it up.

The traps

• Components at the vendor. If the subcontractor needs your material, ship it on a transfer order to a vendor-owned location so consumption is recorded when the operation completes, not when the material leaves. Otherwise stock is wrong in both places.
• Partial receipts. Vendors return 800 of 1,000 good and 200 for rework. Receive the 800, and use the quality disposition for the rest — don't force the PO closed.
• Lead time. Set the subcontractor work centre's queue and run times realistically; planning uses them, and "the plater takes a week" needs to be in the routing, not in someone's head.
• Vendor without a PO. If the shop sends parts out on a phone call and the invoice arrives later, none of this works. The PO from the worksheet is the control.

FAQ

Do I need Premium? Yes — subcontracting sits on production orders and routings.

Can one operation go to different vendors depending on load? Yes, by changing the work centre on the specific order's routing, or by having two subcontractor work centres and choosing at release.

How does the vendor know what to do? Since 2026, the routing instructions and attachments on the PO. Before, you emailed them. Now the PO carries them.

Can I subcontract a whole assembly? Yes — a routing with a single subcontracted operation. Or buy it as a finished item, which is often simpler if you never touch it.

Outsourcing operations on a phone call and an invoice? Free assessment, no commitment — we'll set up the worksheet against your real routings.

Bramvia · bramvia.net