Bill Of Materials (BOM) And Types

A bill of materials – BOM – is the full list of every item necessary to build a product. It enumerates all parts, assemblies, subassemblies, raw materials, and components that building the product involves. It also accounts for the quantities of every item.

BOM in Process Manufacturing

A BOM may be called a product structure, assembly component list, or production recipe. “Production recipe” is the preferred term in process manufacturing industries. Process manufacturing means producing goods by combining ingredients, raw materials, or supplies from a recipe. Process manufacturing goods examples include beverages, refined oil, food, drugs, plastics, and chemicals.

Process manufacturing makes it possible to produce in wholesale quantities. Production typically demands thermal or chemical conversion, especially with heat, pressure, or time. There is no process to separate product resulting from the process manufacturing process into its constituents. Chocolate, for instance, cannot be split into its ingredients. Weight or volume is the standard measures for goods resulting from process manufacturing. But, this article is about the bill of materials.

A manufacturer of bicycles may have a goal to build 1,000 motorbikes. A bill of materials for motorcycles will comprise every single part that makes up a bicycle. It includes handlebars, wheels, tires, seats, frames, pedals, chains, and cranksets. The bill of materials will also specify the quantities and cost of each component.

A proper BOM helps companies achieve the following:

1. Plan raw materials purchases
2. Estimate cost of materials
3. Gain control of inventory
4. Track and plan material requirements
5. Ensure the accuracy of records
6. Ensure robust supply and reduce the incidence of waste

Structure of a BOM

A BOM is intrinsically hierarchical. The finished product sits at the top, and the hierarchy includes costs, quantities, part descriptions, and product codes in addition to other specifications.

The most common representations for BOMs include:

1. Single-level bill of materials – This is a simple list for a product. Each assembly or subassembly only appears once. The corresponding quantity necessary for each product is also on display.
   The single-level bill of materials is easy to develop, but it is not suitable for complex products. The reason is that it does not explicitly state the relationship between assemblies and sub-assemblies, or between parent and child parts. Therefore, if the product fails, a single-level BOM makes it challenging to determine what needs repair or replacement.
2. Multilevel bill of materials – This is more involved and demands more work to create than the single-level bill of materials. However, it provides more details and specificity on the parent and child parts in the product.
   A multilevel BOM shows the total material necessary. The product structure is also essential to show the relationship between assemblies and sub-assemblies, as well as the parent and child product.

Why Use a BOM?

A BOM is the basis of production planning systems. The information it contains provides the primary data for other business processes such as manufacturing resource planning (MRP) and product costing. Others include plant maintenance and material provision for the product.
BOM is a collection of all possible information that goes into building a final product. It also applies outside the manufacturing field, as in engineering, design, and material management. Other examples are sales and plant management. We’ll take a more in-depth look at engineering BOM.

Types of bills of materials

Various kinds of bills of materials exist. There are, however, three main types worthy of study. These include:

1. Manufacturing bill of materials
2. Engineering bill of materials
3. Sales bill of materials

Manufacturing bill of materials (EBOM)

The manufacturing bill of materials (MBOM) consists of a structured list of all sub-assemblies or items essential to produce a shippable finished product. In addition to presenting information on individual parts, it includes information on the parts needing processing before assembly. It also explains how the different components inter-relate within a product.

Manufacturing bill of materials (MBOM) information interrelates with all the integrated systems involved in the ordering and building the product. These include enterprise resource planning (ERP), material requirements planning (MRP), and sometimes, manufacturing execution systems (MES).

Engineering bill of materials (EBOM)

An engineering bill of materials (EBOM) specifies parts or assemblies designed by the engineering department. An engineering BOM showing the component structure from a functional perspective will comprise of a technical or mechanical drawing of a product.
An EBOM is unrelated to the concepts of configurable BOM (CBOM) or modular BOM. Configurable and modular BOMs are to reflect the selection of items to create saleable end-products.

An engineering bill of materials structured from the design standpoint. Instead of the manufacturing standpoint. Engineers mostly develop it with the help of electronic design automation (EDA) or computer-aided design (CAD) tools. Usually, a product will have more than one engineering bill of materials as the design undergoes several revisions.

The engineering bill of materials makes available the necessary components and directions for making a particular product. It includes things such as raw materials, parts, items, sub-assemblies, interrelated data layers. Other factors like those that influence the cost of the product are also part of the engineering bill of materials.

Using the design perspective is how the EBOM focuses on parts. It usually lists items from the engineering perspective; for example, in an assembly drawing. It excludes items like packaging, shipping containers, and other components essential for a shippable product. It also does not specify the grouping of parts should at each stage of production. These items are preferably within the manufacturing bill of materials (MBOM).

Accuracy of engineering bill of materials is critical since the manufacturing bill of materials depends on the EBOM. Inaccurate or incomplete engineering bill of materials can translate to any of the following:

1. incorrect product costs
2. incorrect inventory levels
3. inaccurate accounting
4. production issues and details
5. needless revision cycles

Several other problems can arise from inaccurate EBOMs. A correct level of detail does at least three benefits:

1. provides manufacturing information to plan for new tools and testing
2. makes improved part-purchasing decisions possible
3. prevents undue changes

The importance of aligning bills of materials is such that several voices recommend companies have the objective of a single bill of materials. Management of the engineering bill of materials is usually within product lifecycle management (PLM) software.

A sales bill of materials (SBOM) provides information about a product in the sales stage. The data means the details of the product before assembly. In other ERP systems, a sales bill of material may be synonymous with kits or kitting. In an SBOM, the list of finished products and the components essential to developing them appear as separate entities in the sales order document. Rather than as an inventory item, the management of the finished product is as a sales item.

A significant point to note is that each type of BOM will involve a distinct structure and level of detail. To illustrate, an EBOM may list segments related to a specific function of the product, like circuit board chips. A manufacturing bill of materials by definition contains all materials involved in manufacturing a product.

While MBOM, EBOM, and SBOM are standard, specific ERP solutions may include many different types of bills of materials. Below are just four examples of types we’ve run across through the years.

1. Production bill of materials: Necessary for all Materials Requirements Planning (MRP) runs and standard production orders.
2. Sales bill of materials: Used for sales documents in cases where the parent item is listed not as an inventory item, but as a sales item only.
3. Assembly bill of materials: Similar to sales BOM, since it is the set of individual items with a specific price. The final product is also not managed as an inventory item, but as a sales item.
4. Template bill of materials: While it is flexible, there are also no real instructions with template BOM. Sales and production documents use this bill of materials type. The parent item displays first with the components listed below.

There are a lot of different ERP systems on the market and many offer variations on traditional manufacturing and engineering bills of material. One things’s for sure, no matter what type of bill of material you use, you need a way to integrate the product definitions across platforms. CADTALK connects disparate data transforming it as it’s moved between engineering bills of material in applications like CAD, PDM, and PLM into manufacturing bills of material inside your ERP or MES applications. Watch our short video to learn more.