Bills of materials for the manufacturing industry: everything you should know

Blog 5 min.

You have Bills of Materials (BOM), and then you have Bills of Materials for the manufacturing industry. Often in this industry you will deal with more complex things than a couch or other furniture, and iwn turn the bill of materials will be much more complex. More often than not you will have to deal with coherence between moving parts, electronics, and software. And then there is the exact configuration a customer has chosen, which you will have to measure up to. To deliver high quality, your bills of materials should be of high quality as well. In this blog you will read all you need to know about bills of materials for the manufacturing industry. Good to know in advance is that they are often referred to with the abbreviation BoM. 

Back to the basics: what is a BoM for manufacturing (Bill of Material)?

When talking about BoMs, we mean an overview of all required parts and materials to realize a customer’s configuration. And when we say all of them, we mean all of them. This means physical items that have to be produced or bought. When a part needs to be created, an underlying BoM will be necessary to determine the materials required to make this part. Further adjustments of parts will also be present on the BoM, for instance when a piece of steel should- or should not have coating. And even for this coating a separate bill of materials may be needed. The same principle counts for electronic components and associated software.

Why is a good bill of materials essential?

The short answer: with a good bill of materials every department in your company knows exactly what work should be carried out.

  • The sales department can determine the selling price based on a correct BoM. No small detail, and important to have in a clear and complete manner.
  • Sales will ensure the BoM is usable for engineering. They will check what exactly this department should do for the selected configuration.
  • Production can determine which parts should be bought or produced based on the bill of materials.

Because all departments know exactly what is expected from them, fewer mistakes will be made and both time and money will be saved. Less frustration will occur and management will be able to make better informed choices. On top of that a good BoM process creates clarity for the customer and ensures an exact translation of the customer’s wishes for production.

BoM creation: How do you create a good bill of materials?

Now that you know why creating a good BoM is essential, you naturally want to know how to actually create one. This is very dependent on the amount of modularity within your product range. It works as follows.

The most important part is that with your bill of materials, you constantly serve the next stage in your production process. So a salesperson should know which options they can sell at all.

That has to be presented in a way that is clear for them and the customer. Next, engineering should be able to see what applies to them on the basis of the BoM. The same goes for production. The function of all these steps is to translate the customer’s wishes to a technical product.

To optimize this process it is important to make all possible modules and configurations insightful, and to know how one module cooperates with another. With this insight the creation of bills of materials nearly becomes the most complicated step.

Simply put, you need to ensure that every department gets a bill of materials with the level and content that suits their job. For instance, a salesperson sells an option of which they do not need to know how exactly said option works with the rest of the product. That is the engineers’ job. Just like a production employee does not have to think about the price of a certain configuration. 

Using product configuration for BoM processing

Each department works at their best with a BoM configuration that is as specific as possible. When you work with a product configurator, you already make a big step here. As it ensures a direct translation from the customer configuration to parameters and BoMs for all other departments further in the process. The logic and coherence between the different modules is already secured in the sales process, so that your salespeople can directly indicate a correct price.

Are you interested in BoM processing with product configuration? And how a product configurator can elevate your manufacturing business?  Request an Elfsquad demo, and we will gladly show you!

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