Manufacturing is the process of putting together a product. Yes, there are many other factors, such as costs, time, quality and more. But all of those concerns are tied to the bill of materials, which collects the pieces that’ll be used to build the final product.
A bill of materials, however, is more than a mere list. If you’re manufacturing anything, then you need to know what is a bill of materials, what is it used for and the types of bills of materials you’ll find in production. We’ll even include a free bill of materials template to facilitate the process.
What Is a Bill of Materials (BOM)?
A bill of materials is the full list of all the materials, components and parts that are required in the manufacturing of a product. The BOM includes how many of each item is needed, with the name, a description and the costs for the item.
As we noted above, the bill of materials is more than a litany of what’s necessary to build the product being manufactured. It’s also an instruction manual of sorts, which explains how to get these materials and how they’ll be used on the production line.
Therefore, the bill of materials can be your central record of everything needed to build your product. It helps you plan what you have to purchase by estimating costs. The BOM also can assist in planning and controlling inventory in order to avoid delays and waste.
The more accurate your bill of materials, the more likely you catch issues with products on the production line and be able to replace the faulty part, material or component that isn’t working fast and reduce production delays.
In a sense, the bill of materials is the foundation of your production plan, which includes those resources and costs. You’ll then schedule them to meet your deadline for getting the product to market. ProjectManager is award-winning project management software with robust Gantt charts that help you plan, manage and track your bill of materials in real time. Organize your job with associated resources and their costs, then set a baseline to capture the planned effort so you can compare it to the actual effort and monitor your production variance. Get started with ProjectManger today for free.
What Are the Bill of Materials Used For?
The bill of materials has multiple uses as we’ve explained above. It’s used to help manufacturers plan their purchases of materials, estimate costs, plan and control inventory and help avoid production delays and waste.
It’s useful for identifying the parts needed to assemble a shippable product, including packaging, but it goes further in that it can direct how to get the items on the BOM and how to use them. It takes what can be a very complex process and provides transparency so everyone involved in the process of procurement, assembly or repair, knows what each item is being used for.
A bill of materials is also useful for inventory management. It shows what you need to have in stock and helps forecast orders to ensure they’re on hand when needed. This adds efficiency to the supply chain. Items that show up on time are less likely to create delays in production, allowing you to optimize your stock, which means less capital tied up in inventory and related carrying costs.
Types of Bills of Materials
There are many different types of bills of materials and some are unique to specific business sectors, for instance. As a point of reference, parent items are upper-level assembly that contains items, which are lower-level components needed to build a parent item. Here are some of the more common types of bills of materials.
Single-Level Bill of Materials
This is for products that might have some construction, but it’s not complicated. There are no sub-assembles, for example. A single-level bill of materials lists all the parts used to assemble the product, which is numerically ordered and used as instructions for construction.
Multi-Level Bill of Materials
When dealing with more complicated assemblage, you’ll be using a multi-level bill of materials. It includes sub-assemblies and is even sometimes further broken down into sub-categories. Except for the most top-level item, all item numbers will be linked to a parent item.
Engineering Bill of Materials (EBOM)
This is made during the design phase of the project and is usually based on computer-aided design (CAD) or electronic design automation (EDA) tools. The engineering bill of materials lists items, parts, components, sub-assemblies and more designed by the engineering team.
Sales Bill of Materials (SBOM)
The sales bill of materials differs from others on this list in that it details the finished product before it’s assembled in the sales phase. The finished product and components are separate items on a sales order and the parent is listed only as a sales item, not inventory.
Manufacturing Bill of Materials (MBOM)
This is used to show all the parts and assemblies that are necessary to make the finished product. Any part that needs to be processed before assembly is included in the bill of materials. The MBOM is then shared with all integrated business systems that order parts and build the product.
Configurable Bill of Materials
Here you’ll find every component needed to design and make materials that meet the customer’s requirements. This type of bill of materials is found in industries with highly configurable products such as in job shops, heavy machinery and industrial machinery.
Production Bill of Materials
This lists the components and sub-assemblies that make up the finished product but also includes prices, descriptions, quantities and units of measure. Then, during the production process, these components are made into finished products.
Assembly Bill of Materials
Instead of the parent item being listed as an inventory item, it’s listed as a sales item similar to a sales bill of materials. But unlike the sales BOM, only the finished product is in the sales document. Children don’t show up as sub-items. This BOM can be with single-level or multiple levels.
What Should Be Included In a Bill of Materials?
There are many different types of bills of materials, but most include the same key elements. We have a short description of the components, parts and more that can be found in a BOM. Note that a bill of materials doesn’t include labor.
- BOM level: Shows where the item fits into the larger bill of materials hierarchy. It is designated with a unique number.
- Raw materials: These are raw materials that are required in the production of a finished product.
- Assemblies & sub-assemblies: Parts of a larger assembly or product accompanied by a drawing that shows how the assembly will be put together.
- Part number: Each part or assembly has a corresponding number to make it easily identifiable.
- Part name: Just as each part needs a number, they should have a unique name that makes it easy to identify.
- Part description: Lists the manufacturer of the part, specifications and other general details to help distinguish between similar parts.
- Unit cost: The standard cost for a particular item.
- Total cost: Multiply the unit costs by the amount needed for each component or part and add them to get the total cost.
- Quantity: The number of each item or part that’ll be used for the assembly or sub-assembly.
- Procurement details: Shows how the part or component will be purchased, produced or manufactured by subcontractors.
Bill of Materials Template
If you’re looking for a document that already lists the key essentials that would be found in a bill of materials, you’ll want to download our free bill of materials template. It’s one of the dozens of free project management templates for Word and Excel that are free on our site. You’ll find free templates for every phase of your project and many industries as well.
Use ProjectManager to Track Your Production Process
Having a bill of materials is crucial to manufacturing any product. But once you have the list, you need to implement that information into the manufacturing process in order to build your project. To keep on schedule, manage tasks and track your resources you’ll need project management software. ProjectManager is online project management software that helps you plan, manage and track in real time.
Track Resources With Dashboards, Workload Charts and Timesheets
The bill of materials is resources and resources must be tracked in real time in order to make sure you’re meeting manufacturing milestones. You can get a high-level view with our live dashboard that tracks cost, time and more. There’s no time-consuming setup as with other tools. It’s ready when you are. There are also color-coded workload charts to keep workload balanced and productive as well as secure timesheets to see how long everyone is taking on their jobs.
While managers will likely use our robust Gantt charts to plan production schedules, not everyone in the production line will want to use this tool. That’s why we have multiple project views that share real-time data so everyone is always working off the most current information. Production planning can also be done on kanban boards that visualize workflows and reduce waste. Jobs can be assigned with robust task lists that show the percentage completed.
Managers can also control their supply chain with real-time visibility, give teams the collaborative platform they need to work better together and get customizable reports to get in-depth data when the dashboard isn’t enough. All that, plus, you get unlimited file storage so your BOM, change requests, invoices and more are all in one central hub.
ProjectManager is award-winning project management software that empowers manufacturers to reduce lead time and keep quality high. Reduce waste and avoid costly bottlenecks with production planning. Meet quality expectations and improve processes. Get started with ProjectManager today for free.