Companies contracted for production often outsource the production of components to subcontractors. In order to know how many components to transfer to the subcontractor, there is a link between the subcontractors' operations and the BOM. This facilitates Master Production Scheduling (MPS) and Material Requirements Planning (MRP), and enables contractors to manage their outsourced and subcontracted components.
Special unit prices are often negotiated between main contractors and subcontractors, so an extra subcontracting price list is available.
Work in Progress
You can send an item to a subcontractor and have the subcontractor return it as a Work in Progress (WIP) to the main contractor. You can also send and receive groups of items without forced reference to the item card.