What is a Bill of Materials (BOM)?
A bill of materials (BOM) is a critical document used in various industries, from engineering and manufacturing to construction and supply chain management. It’s essentially a list of all the components and raw materials needed to build a product or complete a project. The BOM serves as a blueprint for the production process, outlining every step from start to finish.
In engineering and manufacturing, BOMs are commonly used to plan and execute production. They can be created in software such as SolidWorks, SAP PP, and Oracle, and can also be exported in a format such as CSV or PDF. A BOM for a product could include parts, assemblies, sub-assemblies, and materials such as screws, bolts, and nuts. It is also possible to have a phantom BOM in SAP, which is a sub-BOM that does not have any physical components but still needs to be included in the overall BOM.
BOMs can help companies manage the supply chain more efficiently by providing a complete list of all the raw materials needed for production. The BOM can be used to estimate the cost of materials, allowing companies to make better decisions about pricing and budgeting. BOMs can also help companies plan for and manage inventory levels, ensuring that they have the necessary materials on hand when they are needed.
BOMs are not just limited to manufacturing and engineering; they can also be used in construction to estimate the materials needed for a project. For example, a bill of materials construction example might include items such as lumber, nails, roofing, and concrete. This type of BOM can help contractors ensure that they have the right materials on hand and can plan for the cost of the project.
Creating a BOM can be a complex process, but there are many software tools available to make it easier. In SAP, for example, there are tables dedicated to storing and managing material BOMs. These tables can be accessed through transactions such as CS01 or CS02. Similarly, in Oracle, the Bill of Materials module provides functionality for creating and managing BOMs.
What is in a BOM?
- BOM Level—Assign each part or assembly a number to detail where it fits in the hierarchy of the BOM. This allows anyone with an understanding of the BOM structure to quickly decipher the BOM.
- Part Number—Assign a part number to each part or assembly in order to reference and identify parts quickly. It is common for manufacturers to choose either an intelligent or non-intelligent part numbering scheme. Whichever scheme you use, make sure you avoid creating multiple part numbers for the same part.
- Part Name—Record the unique name of each part or assembly. This will help you identify parts more easily.
- Phase—Record what stage each part is at in its lifecycle. For parts in production, it is common to use a term like ‘In Production’ to indicate the stage of the part. New parts that have not yet been approved can be classified as ‘Unreleased’ or ‘In Design’. This is helpful during new product introduction (NPI) because it allows you to easily track progress and create realistic project timelines.
- Description—Provide a detailed description of each part that will help you and others distinguish between similar parts and identify specific parts more easily.
- Quantity—Record the number of parts to be used in each assembly or subassembly to help guide purchasing and manufacturing decisions and activities.
- Unit of Measure—Classify the measurement in which a part will be used or purchased. It is common to use ‘each’, but standard measures like inches, feet, ounces, and drops are also suitable classifications. Be consistent across all similar part types because the information will help make sure the right quantities are procured and delivered to the production line.
- Procurement Type—Document how each part is purchased or made (i.e. off-the-shelf or made-to-specification) to create efficiencies in manufacturing, planning, and procurement activities.
- Reference Designators—If your product contains printed circuit board assemblies (PCBAs), you should include reference designators that detail where the part fits on the board in your BOM. Capturing this information in the BOM can save time and help you avoid confusion down the road.
- BOM Notes—Capture other relevant notes to keep everyone who interacts with your BOM on the same page.
Benefits of BOM
One of the main benefits of a BOM is that it allows companies to plan and execute production more efficiently. By providing a detailed list of all the components and materials required, a BOM can help companies manage their inventory and ensure that they have the necessary raw materials on hand when they are needed. This can help to reduce waste and lower production costs, ultimately leading to increased profitability.
Another benefit of a BOM is that it can help companies to estimate costs more accurately. By providing a complete list of all the components and materials required for production, companies can more accurately estimate the cost of materials and plan for budgeting purposes. This can help companies to make better decisions about pricing and budgeting, ultimately leading to more efficient and profitable operations.
Types of BOM
- Design BOM or Engineering BOM (E-BOM): Used in the product development phase to list all the components and materials required to build a product based on design specifications.
- Manufacturing BOM (M-BOM): Used during the production phase to create the final product. It includes additional information, such as the location of each component on the assembly line and the specific tools and equipment required to assemble the product.
- Purchasing BOM: Used to manage the supply chain by listing all the components and materials required to produce a product and including information about the vendor or supplier for each component.
- Service BOM: Used in industries that provide maintenance and repair services. It lists all the components required to service a particular product or machine, including spare parts and consumables.
- Costing BOM: Used to calculate the total cost of a product.
- Sales BOM: Used to create sales quotes and orders.