Production & Operations

BOM (Bill of Materials)

A comprehensive list of raw materials, components, and instructions needed to manufacture a product.

A Bill of Materials (BOM) is like a recipe for your product. It lists every raw material, sub-assembly, and consumable required to make one unit of finished good. Think of it as the complete blueprint that tells your production team exactly what materials are needed, in what quantities, and sometimes in what sequence.

What Makes a Complete BOM?

A well-structured BOM contains more than just a list of materials. It typically includes:

Item Code/SKU: Unique identifier for each component
Item Description: Clear name and specifications
Quantity Required: How many units needed per finished good
Unit of Measure (UOM): Pieces, meters, kilograms, etc.
Wastage Allowance: Expected material loss during production
Component Type: Raw material, sub-assembly, or bought-out part
Lead Time: How long it takes to procure each item
Cost: Standard cost per unit for costing calculations

Types of BOM

1. Engineering BOM (EBOM)

Designed by the R&D or product development team. It focuses on product design and often includes CAD drawings, specifications, and design notes. This is the "ideal" version of the product.

2. Manufacturing BOM (MBOM)

Used on the shop floor, this includes process steps, work instructions, tools needed, and cycle times. It's the practical version that production teams actually work with. May include additional items like jigs, fixtures, or consumables (like grinding wheels) that aren't part of the final product but are needed for manufacturing.

3. Service BOM

Lists spare parts and components needed for product maintenance and repair. Used by service teams for after-sales support.

4. Sales BOM

Used when selling product bundles or kits. For example, a "Complete Welding Setup" might include welding machine + helmet + gloves + rods, each sold separately but bundled for convenience.

Real Factory Examples

Example 1: Cricket Bat Manufacturing

To make 1 Cricket Bat, a BOM might include:

1 Willow Cleft (Kashmir willow or English willow)
1 Cane Handle
5g Adhesive Glue
1 Rubber Grip
2 Brand Stickers
String for binding (2 meters)
Sandpaper (consumed during finishing)

Example 2: LED Panel Light

1 Aluminum Frame (600×600mm)
96 LED Chips (0.5W each)
1 LED Driver (48V, 2A)
1 Diffuser Panel (Acrylic sheet)
4 Mounting Brackets
16 Screws (M3×8mm)
2 meters electrical wire
Thermal paste (2g)

Example 3: Multi-Level BOM (Bicycle)

A bicycle has a multi-level BOM because it contains sub-assemblies:

Level 0: Finished Bicycle
Level 1: Frame Assembly, Wheel Assembly (×2), Handlebar Assembly, Seat Assembly
Level 2: Wheel Assembly contains – Rim, Spokes (×32), Hub, Tube, Tire

Why BOM Accuracy is Critical

Material Planning: Incorrect BOM = wrong material quantities ordered = production delays or wastage
Costing Accuracy: If BOM is wrong, your product cost calculation is wrong, leading to pricing errors
Production Scheduling: You can't start production if even one BOM item is missing
Quality Control: Ensures consistent product quality by using the same materials every time

Common BOM Mistakes in Indian MSMEs

Not Maintaining BOM at All: Many small units rely on the supervisor's memory about what materials are needed
Outdated BOMs: Product design changed, but BOM not updated in system
Missing Sub-Components: BOM lists "Motor Assembly" but doesn't break down the components inside the motor
No Version Control: Multiple versions of the same product exist, but BOMs are mixed up

Best Practices for BOM Management

Single Source of Truth: Maintain one master BOM in the system, not scattered Excel sheets
Review Quarterly: Verify BOM accuracy every 3 months or after any design change
Include Wastage %: If 5% material is lost during cutting, add 5% to required quantity in BOM
Link to Suppliers: Note preferred suppliers and lead times for critical items
Access Control: Only authorized personnel (Engineering/Production Head) should be able to edit BOMs

How ERP Systems Handle BOM

In a modern ERP like Karygar:

BOMs are digitally stored and linked to product master data
When a Sales Order is created, system auto-calculates total material needed based on BOM
Alerts if any BOM material is out of stock before starting production
Supports multi-level BOMs with unlimited levels
BOM explosion feature: instantly shows all raw materials needed across sub-assemblies
Version control: track BOM changes over time with date stamps
Auto-calculates product cost from BOM material costs

BOM vs. Formula vs. Recipe

While often used interchangeably, there are subtle differences:

BOM: Used for discrete manufacturing (countable items like chairs, motors)
Formula: Used for process manufacturing (chemicals, paints, food) where exact proportions matter
Recipe: Similar to formula but often includes process instructions and temperatures, not just ingredients