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A bill of materials is essential for organizing manufacturing processes, managing resources and reducing waste.
Creating a remarkable product after weeks, months or years in the workshop can be a thrilling experience for an entrepreneur. Although it’s exciting to get a new product up and running, you’ll need to prioritize organization during manufacturing and that includes implementing a bill of materials (BOM).
Once you understand the purpose of a BOM, it becomes much more than a list of items. Indeed, a BOM can shape the effectiveness of your manufacturing and supply-chain processes.
A bill of materials is a comprehensive list of all of the components, subassembled parts and raw materials needed to build your product, along with instructions on obtaining and using said materials. “A BOM is a manufacturer’s recipe for success,” said Edward DeLeon, senior project manager at ECI Software Solutions. “The document outlines the quantity and qualities of each component, as well as the assembly process, through a single source of truth.”
As such, a BOM is a fundamental requirement in the manufacturing world and plays a critical role in developing any unique product. It’s also commonly used in other adjacent departments — engineering, design and even sales — to maintain effective product quality and scheduling.
Whether you are making a toy or a rocket, a BOM helps you accurately manage and oversee resources and identify materials to reduce wasteful spending. Here are a few ways BOMs contribute to efficiency and cost management across the manufacturing process:
Traditionally, the engineers overseeing a given project organize the BOM. They usually complete this process with the help of a computer-aided design (CAD) drawing. Multiple BOMs must be created to keep a client informed during the production process and to account for the specific materials needed for a product.
A bill of materials is designed to show the components, materials and quantities required for each step in the manufacturing process. A BOM displays that information in one of these ways:
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There are many types of BOMs, some of which fulfill unique or specific needs in particular industries. Here are the most common types of BOMs.
An EBOM defines the product as designed, meaning it lists numerous items, components, subassemblies and overall parts needed for a product. For instance, a printed circuit board designed by engineers lists the resistors, capacitors and chips needed to assemble the board. Engineers use electronic design automation to streamline the creation of their EBOMs.
Unlike other kinds of bills of materials, an SBOM outlines the details of the finished product before the production and engineering teams assemble it. Not only do the components appear as separate items, but the finished product is listed as a separate item on the SBOM document for the client.
An MBOM constitutes the assemblies and parts required to create a business’s final product. This document usually contains detailed information about ordering parts and building the product and that information is passed on to the subsequent departments involved in a product’s building phase. The key to these kinds of BOMs is accuracy.
A CBOM is used in industrial and heavy manufacturing industries across the world. It zeroes in on a customer’s specific requirements for components that will be needed to design an item, manufacture it and pass it along to the next department in the product-building pipeline.
A PBOM lays out what will be the bedrock for a customer’s product order. Prices, quantities, descriptions and associated units of measurement are all laid out in a PBOM. This helps the production teams keep track of the right materials that they will then transform into finished products for the next building stage.
An ABOM shows which items are listed to sell versus to store for building. Like an SBOM, an ABOM lists sales items. However, an ABOM does not list the finished product. An ABOM can be single- or multilevel, depending on the product demands.
Although a TBOM has similarities with other BOMs, it breaks down what will be needed in each BOM, without specifically listing each product component, part or stage that is displayed for the product teams in the other bills of materials that will be needed to create a customer’s final product.
Here is the step-by-step process for creating a BOM:
Like a recipe, a BOM ensures your product has the right ingredients (materials and components) to be made correctly. “The more information and data, the better,” emphasized DeLeon. “Include clear and specific component names and descriptions in each list, along with their unique part numbers, quantities and units of measure.”
Whether you are planning your BOM or studying ways to improve your BOM, here are the most important fields to include on your BOM record.
To be useful, BOMs must be highly detailed — and all those details must be both complete and accurate.
“When it comes to BOMs, you can’t afford to wing it,” DeLeon said. “Mistakes such as incomplete details, missing updates or poor naming conventions can quickly snowball into bigger problems.”
To avoid these issues, DeLeon advises building out a complete account of the necessary items and processes, as well as establishing clear and consistent naming conventions. Artificial intelligence (AI)-powered BOM tools can also significantly streamline the input process and reduce instances of human error. “AI BOM builders … automatically create BOMs, removing the labor-intensive manual process,” explained DeLeon. “Manufacturers can upload images, PDFs, CAD drawings or CSV files, which AI can parse to identify materials and their quantities, streamlining inputting and informing estimating.”
DeLeon added that users always have the final say, with the ability to review and edit AI-generated documents to ensure accuracy.
Creating a BOM is not just an ordinary development step; it’s a critical stage to ensure total consistency throughout the manufacturing process. A well-defined BOM will tell you how much of each individual part you need to purchase and when you should make those purchases.
Danielle Fallon-O’Leary and Jared Haw contributed to this article.