Given the range of information a BOM contains, preparing one frequently requires input from a company’s cross-section of departments. Engineering, design, purchasing and materials management are often primary users of different kinds of BOMs.
A BOM identifies the raw materials, assemblies and sub-assemblies necessary to construct a final shippable product. It also provides information on each component and its quantity.
Engineers
The preparation of a bill of materials is the responsibility of engineers, who typically use computer-aided design (CAD) software. A BOM is a list of the parts, components, subassemblies and assemblies that go into the engineering product. The BOM can also contain the purchasing information, supplier information, and cost details. It’s important to ensure that the information is accurate and complete before uploading it into the inventory system. Limiting the number of people who have editing access to a BOM helps prevent errors that could be costly.
For manufacturers, a bill of materials is an essential document for tracking every component used in production. It allows them to identify and eliminate avoidable waste by tracking the exact quantity of each part that goes into a finished product. The BOM can also help them make better trade-offs between time, cash flow and inventory control. It can also be useful when deciding whether it’s more economical to purchase or outsource assemblies.
During the design phase of manufacturing, engineers create an engineering bill of materials (EBOM). This is a special type of BOM that defines the product as designed. It contains the list of items, parts, components and subassemblies that engineer designs, and it is presented in a technical drawing. An EBOM is distinct from modular and configurable BOMs, which reflect the selection of items to create saleable end-products.
An EBOM is also different from a manufacturing bill of materials (MBOM), which lists all the components, sub-assemblies and assemblies that are required to manufacture a product. It can also include the raw materials that are needed to ship the product and account for any scrap or wasted material. An MBOM can be structured in a variety of ways, including single-level or multi-level. Choosing the right structure is important because it can impact production processes, product costs and accounting.
For contractors, a bill of quantities (BOQ) is an estimate of the materials and labour that are required to carry out work. It can be prepared by a quality surveyor, a cost consultant or a civil engineer who specialises in estimating construction materials. The preparation of a BOQ can save significant money for the contractor and reduce the chance of mathematical errors. It can also be provided to tenderers to assist them in pricing the job.
Purchasing Department
Bills of materials are important documents for manufacturing, purchasing and inventory management. They provide a detailed list of the raw materials, assemblies, subassemblies and parts that are required to build a product. A BOM includes information such as part number, part name, quantity, unit of measurement, assembly references, method of parts construction and additional notes. It is used to plan procurement, estimate costs, control inventory and minimize production delays and waste. It also helps in planning and analyzing the entire supply chain for a company.
Besides the engineering department, other departments in a company also use the BOM for many purposes. For example, the Purchasing Department uses the BOM to order raw materials from suppliers. It helps the Purchasing Department know exactly what materials are needed and ensures that these materials meet the specifications of the final product. This ensures that the product is ready for production and avoids costly mistakes.
In addition, the BOM allows Purchasing to calculate the total cost of a finished product. This allows Purchasing to negotiate prices with suppliers and save money on purchases. Moreover, the BOM helps Purchasing plan for and control inventory by ensuring that all components are available in the correct quantities when needed. The BOM also prevents over-ordering and unnecessary expenses.
A bill of materials is often referred to as a product structure, assembly component list, product recipe or production formula (in process manufacturing industries). A BOM is fundamental to the effectiveness of several processes, including design, material requirement planning, inventory planning and scheduling and costing.
A BOM can be displayed in two ways: a BOM explosion or a BOM implosion. A BOM explosion displays an assembly at the top level broken down into its component parts. A BOM implosion displays the linkage of individual components at a lower level to an assembly or sub-assembly at a higher level. Most complex products use multi-level BOMs.
Manufacturing Department
A bill of materials is a key tool in the process of bringing product designs to life. It is a centralized source of information used to manufacture a product, including a list of all components and the instructions on how to assemble them. It also lists the cost of each component and provides an estimate of the total cost of production. Creating and maintaining a BOM can be a complex process, especially since it is likely to go through multiple iterations as the design of the final product evolves. It is also likely to be shared and modified by several people, making it difficult to keep track of all changes and ensure that the most recent version is being used.
A well-designed and up-to-date BOM can improve decision-making, streamline production processes, reduce waste and boost supply chain resiliency. On the other hand, a BOM that is not kept current can lead to inaccurate production estimates, product errors, shortages or overages in materials and costly expediting charges to make up for delays caused by missing parts.
BOMs are utilized by a variety of departments, including engineering, procurement, and manufacturing. The type of BOM required varies depending on the product and business needs. For example, an initial concept or prototype BOM may provide only the basic components needed for a given project, along with ballpark price estimates and minimum order quantities (MOQs). Then, as the design is fleshed out and detailed, the BOM evolves to include a more comprehensive listing of assemblies, sub-assemblies and individual components. This form is known as an engineering bill of materials, or EBOM.
The EBOM specifies the component structure from a functional perspective at the completion of the engineering phase and is sent to vendors for quotation. It contains the names, part numbers, descriptions and quantities for each component, as well as their dimensions. It may also specify alternate or substitution parts, as well as the underlying assembly and its requirements.
The resulting quotes can be entered into the Purchasing Department’s sourcing system, which will then generate a Purchase Order for each item or assembly. This process is often automated to speed up the ordering and receiving of materials. A sales bill of materials, or SBOM, is another common form of BOM that appears in the sales stage. It is created when a product is configured by customers using in-store software and touchscreens. For example, a shoe store configurator will display Shoe X and then the different components that can be selected to create it: a 3D printed sole that matches the customer’s foot impression; fabric and laces in the customer’s choice of colors; and so on.
Logistics Department
A well-written BOM is an essential part of the product development process. It provides information about the materials needed to produce a finished product, as well as the assembly and manufacturing steps required. It also facilitates decision-making and boosts supply chain resiliency. By establishing clear material requirements, a BOM reduces waste and increases production efficiency. It can even help organizations capture customers more quickly, and save money by cutting unnecessary expenditures.
The logistics department is responsible for ensuring that raw materials and semi-finished products arrive at the company’s premises in good condition, and that they are stored and distributed according to the needs of customers. This involves coordinating with vendors, service providers and transport carriers. The department is also responsible for drafting plans, policies and procedures to ensure efficient use of the logistics system.
To prepare a BOM, the engineering department typically utilizes software programs such as AutoCAD and SolidWorks. The resulting BOM is then transmitted to the manufacturing department where it’s used in the product’s production. The manufacturing BOM is similar to the engineering bill of materials, but it includes the specific process of assembling the product. It also includes the corresponding assembly instructions and the exact quantities of each part. The resulting document is sometimes called a material take off (MTO).
Both the engineering and the manufacturing departments can use the information contained in a BOM to make decisions on the best way to produce a product. This can help them avoid expensive mistakes and improve the quality of their work. For example, if the manufacturing department doesn’t have enough parts on hand, it may need to delay production or order additional materials. A BOM can also help them identify and correct errors before they cause a costly delay in production.
The logistics department can also use the BOM as a reference to calculate the costs of each component. The technical department can then carry out cost reduction activities such as replacing expensive aluminum components with cheaper plastic ones. The logistics department can also refer to the BOM when ordering spare parts for a product.