Raw materials play an important role in manufacturing industries. To have proper inventory and for an uninterrupted production cycle, the Bill Of Material is vital.
In this article, you will get complete and well-researched information about BOM.
What is Bill of Materials?
A bill of materials primarily consists of all the lists of raw materials, parts, components, assemblies, sub-assemblies, and all other items required to manufacture, repair, or reconstruct an item.
The number of materials needed, the time to be consumed, even the necessary amount of labor in each subpart to be arranged accordingly are available in a Bill of materials (BOM).
The Bill of materials definition generally says that it is like a communication card between the planning and designing units and the manufacturing unit. Hence, it might also be a production recipe if required.
Multiple-level Bill of materials is when providing more essential details and information compared to single-level BOMs.
Bill of materials Example
While building a racing bike, the builder will need an assortment of various tools required to make the bike from scratch.
Items like wheels, brakes, seat, handles, a pulley, a chain, plenty of small nuts, and screws along with various other things.
A BOM for building a racing bike would also contain the quantities required for each of the items.
Now, based on the type of Bill of materials, it might also contain the steps to build up the bike, along with the labor and time consumed by each step.
The BOM is like the basic blueprint laid out to build, rebuild, or repair any item or product of interest. All the workers involved in the manufacturing and post-production processes as well must be aware of the manufacturing BOM. It connects the various units required for the final product to be ready.
In this case, the final product is the racing bike. The bike preparation completes when assembling all parts of the bike along with the seat, handles, and brakes complete.
Even one item missing might stop the product from being viable, such as the cycle here might not work without the chain, might not even start without the wheels, and might not stop without the brakes.
It is essential to know how to make a bill of materials to create the structure for any manufacturing unit.
How does the Bill of Materials help?
It is used in businesses mostly functions as the roadmap to the functioning of a finished product.
- Plans the purchasing with the help of automation.
- Keeps a tab on the total purchases of all the materials required sequentially, helping a cost-effective plan to materialize.
- Maintains proper records and plans materials requirements.
- It also helps in keeping a tab on inventory control, thus preventing and reducing waste.
- Bills of materials designed for any product pave a path ahead and also allow scope for rising productivity and yield, thus resulting in more profit.
Key terms associated with Bill of Materials
The inventory of terms related to the Bills of materials is an essential aspect of the management of BOMs. It is necessary to understand this correctly.
Children’s BOMs are more accurately known as assemblies, sub-assemblies, and parts or levels of BOM hierarchy. These subparts are mostly raw material requirements for a final finished product.
Parent BOM or the main element in a hierarchical BOM is the component that is present at the top.
Only product descriptions and price is mentioned for the parent from which branching of raw materials has been generated to give a hierarchical structure.
An item that is physically built, but not stocked or creates into an inventory simply because it is an intermediate step and gets absorbed in some other process is known as a Phantom item.
Such BOMs are easily accounted for because only a demand for the following product justifies the existence of a phantom item.
A Pseudo BOM generally refers to a more flexible form of the Bills of materials. Mostly related and interchangeable groups with common attributes can be readjusted more suitably and simply.
A Planning BOM is also no different from the regular BOMs. It mostly comprises a summary of the items requires to produce a final thing.
It also plans on unforeseen demands that might arise over time.
Types of Bill of Materials
There are various types of Bills of Materials used in manufacturing units, depending on the nature of the finished product.
A BOM is hierarchical, with the finished goods on the top along with print codes and manufacturing dates.
The next line consists of broad aspects of raw materials required. Separate BOMs have separate designs and structures.
Manufacturing Bill of Materials
A manufacturing BOM is the most common type of BOM for a manufacturing company as it makes the functioning of a manufacturing unit smoother and more coordinated.
A manufacturing BOM or an mBOM displays all the assemblies and sub-assemblies of parts required to manufacture a final finished product.
A manufacturing unit works with other integrated units required for the functioning of several processing events required even before the manufacturing is done.
Hence, a reliable road map with all the information is provided along with the quantities. These quantities make it easier to order all the parts.
This also makes it easier to achieve a cost-effective strategy by negotiating the best possible price from the vendor.
Engineering BOM (eBOM)
An engineering BOM or eBOM is prepared during the design phase of any product.
A computer-based design is ready, along with detailed descriptions of products and parts required under their relationship with the final product, as depicted in the drawing.
A company can have more than one engineering BOM as there might be different angles to a product.
For example, there might be a safety and maintenance angle to a product, and also productivity and yield might be considered as another angle.
When a BOM design is prepared by Electronic Design Automation (EDA) tools, all the prospective ideas regarding the functioning of the product need to be considered.
Questions like how does it function? How does it cope with malfunctions? How to make a cost-effective design? Need to be answered.
A service BOM consists of lists of items required by a service person for installing, repairing, or restocking products.
The service BOM consists of the information needed by the technician for performing their services.
These services could be at the site of business or the place of manufacturing. The company maintains Service BOM and is essential for the proper functioning of the product.
A sales BOM comprises items that have been put upon sale. Items that are for selling, as well as stock, are listed within a Sales BOM with adequate product descriptions alongside every item.
Both the finished product and every part are required to have the final product functioning properly. In the case of a Sales Bill of materials, the critical fact is that all items listed here are not inventory, unlike the other bill of materials.
Production Bill of materials
A production BOM is similar to a Sales BOM in the way that it also consists of items along with their product descriptions and prices.
The items listed here are assemblies and sub-assemblies that ultimately will be converted into a finished product after the production process.
Single level bill of materials
This is the most simple and least complicated type of BOM. The Children or assemblies and materials required in the processing are only up to one level.
All the parts listed under the Parent are required to produce the final product. Most small to medium businesses work with single-level BOMs.
Typically all the components needed are listed here as a broad category. More levels can be added based on the increasing complexity of the product design.
In case of a more complicated product design where more parts and sub-assemblies are required, a multi-level BOM is put to use. In this case, more than one level of children is listed under the final product.
It gives results to a more detailed and well-structured product design with specific descriptions for every aspect of the product.
The standard Bill of materials SAP system allows the use of individual and specific BOMs in an area.
How to create bill of materials?
The first step to creating a valid Bill of materials is the knowledge of your business inside out. Finding out all there is essential. You must ask questions like, what am I manufacturing? How will I manage my BOM?
What are the components to be considered while creating a bill of materials?
The components to be considered while creating a bill of materials are BOM level, BOM notes, Description, Part Number, Part name, Measurement unit, quantity, procurement type, Phase, and requirement of BOM.
This is a ranking given to each part or assembly within the broader BOM. It makes it easier to refer to each component and allows them to be taken into consideration accordingly.
BOM notes are any information other than the required data.
Refers to the information about each material requirement along with the final product to be designed. It is comprehensive and informative.
It helps you distinguish between similar-looking parts and have an idea about each one’s functioning.
It is a number created for each item or assembly so that items can be identified easily and quickly.
It is an easily identifiable unique name for each part, to refer to each item separately.
It indicates the stage of each part in its production cycle.
It is a measuring unit of the items like inches, feet, ounces, drops, kgs, etc. It helps to track the accurate quantities delivered to production.
It is the required amount of items for the ease of planning, and also for maintaining the inventory levels.
Type of procurement
It is a document that tells how each part is purchased. It helps to increase efficiency in the manufacturing and procurement process.
The requirement for BOM
The idea of creating the BOM must be clear. Whether it is still in the planning phase, designing phase, manufacturing, or production phase, the goal to be fulfilled by the BOM eventually determines its course.
Software to be used
Maintaining an effortless BOM account is not as easy as it sounds. It takes choosing the right BOM software to create the seamless Bill of material that you require.
Most companies use traditional software like Excel, but with the increased use of technology and complicated projects, specially designed BOMs are now available.
New technology is to develop advanced software with real-time monitoring capabilities along with other deeper functionalities.
Full functionalities with highly sensitive inventory tracking and smart status tags make modern-day Bill of Materials software so unique.
The bill of materials software for small businesses can be specifically designed for your business or can be bought in a generalized form from the market entirely based on your requirements.
Managing your labor and other manual resources becomes seamlessly smooth. It draws away a lot of pressure off the system and provides scope for other opportunities, thus increasing productivity and performance.
Bill of materials software free can be easily downloaded from the internet or used for a trial period to see if it suits your requirements.
You can later switch over to detail BOMs designed explicitly for your business. Many of the open-source ERP solutions are having BOM functionalities in them.
Future of Bill of materials
With the advent of technologies, modern technologies are soon to be taken over by future generations owing to more significant communications, flexibility, and scope for specificity.
The vision of OpenBOM is the beginning of real-time data collaboration and high-level data management.
The concept of OpenBom might give rise to a 24/7 global collaboration and synchronization, along with a hypersensitized network handling the significant workforce multiplied by many folds.
With OpenBOMs, a global initiative will be in sight, with instant data sharing, different teams, people, and groups accessing data from separate locations.
These new systems will give rise to a prospective future in data AI or Artificial Intelligence. It is essential to upgrade oneself with the changing technology simply to stay relevant and in competition.
BOM or Bill of materials is a necessary part of your manufacturing procedure that cannot be left out whatsoever.
It is vital to consider all the information you can manage to figure out how you want to control the process and utilize the data.
Developing an efficient and seamless BOM is the stepping stone for a more detailed and useful manufacturing process.