Special thanks to Business.com for posting this article first.
Regardless of what you are selling, when it comes time to make your product, there is one thing all manufacturers will ask you for: a bill of materials, or BOM.
It doesn't matter if you are just starting out and searching for someone to manufacture your product, trying to shave off some of your cost of goods sold (COGS), looking for a more efficient means to manufacture your product, or just asking a factory for a quotation – all manufacturers will ask you to provide a BOM.
What is a BOM, and why is it so important?
A BOM is a fact of life in the manufacturing world and plays a critical role in the development of any product. Simply put, you cannot manufacture a product without one. In essence, a BOM is a comprehensive list detailing all the components and sub-assembled parts and raw materials needed to build your product.
Whether you are making a toy or a rocket, a BOM helps you to accurately manage and oversee resources and identify materials to reduce wasteful spending. It provides you with accurate information, which will help you to make better decisions to manufacture your product efficiently and cost-effectively.
What should a BOM include?
Like a recipe, a BOM ensures your product has the right ingredients (materials and components) to be made correctly. Whether you are planning your BOM or studying ways to improve your BOM, here the most critical fields to include on your BOM record.
Material: Knowing what material your product is composed of is crucial, depending on your product's function, and necessary to determine where to shave off costs. Simply stating "plastic" will not be good enough; the exact type of plastic should be defined.
Finish/texture: Like color, texture and finish of a product is one of the most critical aspects in the customer buying process and can be the difference between an end customer purchasing your product or going with your competitor. Don't be lazy – include the type of texture or finish you are looking for.
Quantity: This allows you to record the number of parts used in each assembly and will help you make purchasing and manufacturing decisions. For example, you might need five of the same screws for assembly, so, under Quantity, you should include 5.
Unit: This allows you to classify the measurement in which a part will be used or purchased. Standard measures include pieces, centimeters, inches, feet and yards. As a rule of thumb, you want to remain consistent throughout to help ensure the right quantities are procured and distributed to the production line.
Supplier: Record the name of the supplier that provides you with that part. If you are sourcing multiple suppliers, it might be a little confusing, so keeping track of which supplier you are using for production becomes critical.
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 when and how much of each individual part you need to purchase.