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Bill of Materials

Overview

A Bill of Materials (BOM) defines the components and quantities required to manufacture a finished product. The BOM module allows you to create, manage, and cost your manufacturing recipes.

Key Concepts

Bill of Materials

A BOM is a structured list that specifies:

  • The finished product being manufactured
  • All component products required
  • Quantity of each component needed per unit of finished product
  • Optional work centers for routing

BOM Types

  • Normal BOM: Regular manufacturing recipe. Sub-assemblies of this type must be produced via their own Manufacturing Orders before being used.
  • Phantom BOM: Used for virtual sub-assemblies. When an MO is created, Phantom components are automatically "exploded" into their raw material constituents.
  • Kit BOM: Used for products that are sold as a set. Similar to Phantoms, they explode into their base components during manufacturing or sales.

Creating a Bill of Materials

Step 1: Navigate to Manufacturing

  1. Go to Manufacturing → Bills of Materials
  2. Click New Bill of Materials

Step 2: Define the Finished Product

  1. Product: Select the finished product this BOM will produce
  2. BOM Code: Enter a unique identifier (e.g., BOM-WIDGET-001)
  3. Quantity: Specify how many units this BOM produces (typically 1.0)

Step 3: Add Component Lines

For each component required:

  1. Click Add Component in the Components section
  2. Component Product: Select the raw material or sub-assembly
  3. Quantity: Enter how many units are consumed per BOM quantity
  4. Unit of Measure: Verify the UoM matches the component product

Example: To manufacture 1 Widget, you need:

  • 2 units of Steel Plate
  • 4 units of Bolts
  • 1 unit of Paint

Step 4: Optional - Add Work Centers

If your manufacturing process requires specific equipment:

  1. In the Routing section, add work centers
  2. Specify the sequence of operations
  3. Define time required at each work center

Step 5: Activate the BOM

  1. Review all component quantities
  2. Click Save
  3. The BOM is now ready to be used in Manufacturing Orders

BOM Costing

Viewing BOM Cost

The system automatically calculates the total cost of a BOM based on:

  • Component product costs
  • Quantities required
  • Current inventory valuation

Cost Breakdown

Navigate to a BOM and view:

  • Total Component Cost: Sum of all raw materials
  • Per Unit Cost: Total cost divided by BOM quantity
  • Cost by Component: Detailed breakdown showing each component's contribution

Using BOMs in Manufacturing

Creating Manufacturing Orders from BOMs

  1. Open the BOM record
  2. Click Create Manufacturing Order
  3. Specify:
    • Quantity to produce
    • Source location (where components are stored)
    • Destination location (where finished goods will be placed)
    • Planned start date

BOM Versioning

When you need to update a BOM:

  1. Create a new BOM with a new code (e.g., BOM-WIDGET-002)
  2. Mark the old BOM as inactive
  3. New Manufacturing Orders will use the latest active BOM

Best Practices

Component Accuracy

  • Double-check all quantities before activating
  • Use consistent units of measure
  • Include all components, even small items

BOM Organization

  • Use clear, descriptive BOM codes
  • Include product name in the code (e.g., BOM-CHAIR-OAK-001)
  • Document any special instructions in the notes field

Cost Management

  • Regularly review BOM costs
  • Update component costs when supplier prices change
  • Use BOM costing to set product selling prices

Multi-Level BOMs & Recursive Explosion

For complex products, the system supports multi-level BOM explosion up to 10 levels deep.

How it works:

  1. Create BOMs for sub-assemblies first.
  2. When creating the final product BOM, use those sub-assemblies as components.
  3. If a sub-assembly BOM is of type Kit or Phantom, the system automatically "explodes" it during Manufacturing Order creation, replacing it with its raw materials.
  4. If a sub-assembly BOM is of type Normal, it remains as a single component that requires its own separate Manufacturing Order.

Benefits:

  • Recursive Math: Quantities are multiplied accurately through all levels.
  • Cost Rollup: The "Structure & Cost" tab provides a total hierarchical breakdown of costs.

Common Scenarios

Scenario 1: Simple Product Manufacturing

Product: Wooden Chair Components:

  • 4x Chair Legs (Wood)
  • 1x Chair Seat (Wood)
  • 1x Chair Back (Wood)
  • 8x Wood Screws

Scenario 2: Multi-Level Assembly

Product: Office Desk Components:

  • 1x Desktop (Sub-assembly with its own BOM)
  • 4x Desk Legs (Sub-assembly with its own BOM)
  • 1x Hardware Kit (BOM with screws, brackets)

Scenario 3: Variable Quantity BOM

Product: Paint Mix (10 Liters) BOM Quantity: 10 Components:

  • 7 Liters Base Paint
  • 2 Liters Pigment
  • 1 Liter Thinner

This allows you to scale production: ordering 20 liters will automatically consume 14L base, 4L pigment, 2L thinner.

Troubleshooting

BOM Cannot Be Deleted

Issue: "This BOM is referenced by Manufacturing Orders" Solution: BOMs with associated Manufacturing Orders cannot be deleted. Mark as inactive instead.

Component Cost Shows Zero

Issue: BOM cost calculation shows $0 for a component Solution: Ensure the component product has a cost set in the Product master data.

Wrong Quantities Consumed

Issue: Manufacturing Order consumed incorrect quantities Solution:

  1. Check the BOM quantities are correct
  2. Verify the Manufacturing Order quantity
  3. Quantities consumed = BOM component qty × MO quantity