What Makes a Good Bill of Materials?

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An effective Bill of Materials (BOM) can enhance businesses productivity and operations. A BOM is a lengthy list that comprises everything a company needs to manufacture and deliver a product. It outlines the entire lifecycle of a product. This can include a list of raw materials, parts, components and quantities of inventory stock needed to make the product come together. It will also highlight procurement and logistics information and tools needed on the assembly line. Effectively, a BOM outlines every single critical aspect of a product’s lifecycle and what is involved in its production journey. It is like a map that guides a business through A to Z of what happens with a product. A BOM can be simple, listing the contents for one product or technically involved for a complex family of products.

In order to create an effective BOM, check out these tips to enhance or alter your current BOM.

Understand your users

Who is reading your BOM? If you want to have a successful BOM, you need to ensure it speaks to all of your integral readers. The BOM is a blueprint for a product. Therefore, this blueprint should articulate exactly what is going on. The readers should walk away from it knowing precisely what’s required for the product.


When creating a BOM, look to automate it as much as possible. Automation will ensure that the products can be traced. When there is automation and you can trace components, this will increase your accountability. Automation can decrease human errors and inventory stock can be tracked throughout the process. This also can increase efficiency on the production line.

Stop using spreadsheets

Historically, businesses have crafted their BOMs on a spreadsheet. This involves manual data entry, which is time-consuming and can cause errors. It’s another feature that should be automated and streamlined as much as possible. Look to incorporate a cloud-based software that can make updates easier. With a more dynamic system, you can track changes to component numbers, procurement prices, inventory stock numbers, and make edits as you see fit.

Use one master version of your BOM

Different stakeholders and teams in the business need BOMs for different reasons. Often, BOMs are edited but the changes are difficult to keep track of if multiple versions exist. Someone could open up an email with a BOM, but it might not be the latest version. This can waste time, cause confusion and people can become frustrated. Look to move your BOM into the cloud where you can track changes in real-time and everyone has access to the most recent document.

Get the information in early

Don’t wait to update the BOM. When anything changes to your system, such as a piece of warehouse equipment or a specialised part you’ll need to add that into the BOM. Get the product’s BOM information from the supplier and add it in promptly. There’s no reason it can’t be in your system before it’s up and running. This avoids backlogs and gaps in information in the BOM.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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