Subcontracting process occurs when a company hires (subcontracts) another company or an individual to perform the tasks that typically cannot be done internally. Subcontracting can happen occasionally or be a part of the production process. Generally, a subcontracting process involves transferring of raw materials and components to subcontractor premises where these materials and components are being converted to semi-finished goods and transferred back. For example, if you manufacture shoes, for a new line of winter winter shoes you may need to transfer to a subcontractor subcontractors your stock of leather for dyeing and fabric for waterproof processing. Also, you may need to subcontract molding of new types of soles to be made from your stock of rubber.
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