Bill of Materials

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Bill of Materials

• Janean F. Lulloff
• Business Management 361 Section 1
• Dr. Foster
• Marriott School
• Brigham Young University

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Contents of Tutorial

• Definition of a bill of materials
• How a bill of materials is used
• Types of bill of materials
• Bill of materials information
• Benefits of a bill of materials
• Examples of bill of materials

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Definition

• Bill of Materials (BOM)
• A listing of all the subassemblies,
  intermediates, parts, and raw materials that go
  into a parent assembly showing the quantity of
  each required to make an assembly.

Bozarth, Cecil C. and Handfield, Robert B.
Introduction to Operations and Supply Chain
Management . Pearson Education, Inc., Upper
Saddle River, New Jersey, 2006. p.461.
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Definition Explained

• Basically, a bill of material (BOM) is a complete
  list of the components making up an object or
  assembly.
• It is also part of material requirements planning
  (MRP)

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Processes that utilize a BOM

• Production
• Materials planning
• Product costing
• Plant maintenance

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How can a BOM be used in your organization?

• Several software programs are available that
  store item information and prepare bill of
  materials automatically

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Types of BOMs

• Static (fixed) bill
• A bill of material for a part that is normally
  made from the same components, labor and raw
  materials.
• Used for standard assemblies, components, and
  engineer-to-order customer orders.
• Example
• A bill of materials for a standard chair

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Types of BOMs

• Dynamic (parametric) bill
• A bill of material for a product or part for
  which size, color, laminate, and other options
  can be selected.
• Example
• A bill of materials for a Dell computer

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Types of BOMs

• Single level bill of material
• A bill of material that lists the materials,
  parts and labor required to make another part.
• Example
• A bill of materials to make a Dell computer

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Types of BOMs

• Multilevel bill of material
• A bill of material that lists the components,
  assemblies, and materials required to make a
  part, the components, assemblies, and materials
  required to make each component and assembly of
  the part, and so forth.
• Example
• A BOM for the battery inside the Dell computer.

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Structure of a BOM
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What information is on a BOM?

1. Quantity
2. Item ID
3. Description of Item
4. Cost of Item
5. Total Project Cost

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Quantity

• Tells user how many of each part is needed for
  each project
• Example
• A chair needs 1 seat, 4 legs, 1 back, and 5 nails.

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Item ID

• Tells us which part to order
• Can be any of the following
• Catalog number, UPC, or any other identification
  number.
• Example
• The chair needs a 2PC seat, 5DR legs, 6TU8 back,
  and 1 inch nails.

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Description of Item

• Provides a check that the correct item is being
  ordered.

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Cost of Item

• Cost is included to show how much each part is
  per item and the total cost of all like parts.
• Example
• The cost of a leg is 5 per leg. Then the total
  price of the legs ordered would be 20 because
  there are 4 legs.

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Total Project Cost

• Shows the total cost of all items and is also the
  total cost of the direct materials used in the
  project.
• Example
• Seat-10, Back-5, Leg-5 per leg, Nail-.5 per
  nail
• Total Cost of a chair 10 5 54 .55
  37.50

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Benefits of a BOM

• Optimize engineering, planning and purchasing
  efforts by providing centralized and up-to-date
  information in Make-To-Stock, Repetitive, JIT or
  Job Shop environments.
• Improve material management by responding to
  changes in production.
• Reduce inventory levels and obsolete parts.
• Reduce manufacturing costs.

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Benefits of a BOM

• Minimize clerical and engineering efforts by
  optimizing the tasks of maintaining and changing
  multi-level bills.
• What-If capabilities for estimating or quoting.
• Supports variable length part numbers and
  unlimited descriptive text.
• Easy methods for accessing part information

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BOM Example

• Quantity ID Description Unit Price Total Cost
• 1 6TU8 Back 5/Unit 5.00
• 4 5DR Legs 5/Unit 20.00
• 1 2PC Seat 10/Unit 10.00
• 5 1 Nails 0.50/Unit 2.50
• Total Project Cost 37.50

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BOM Example

• 161kV H-Frame Tangent
• Quantity Catalog No. Description
• 2   70-foot Wood Pole
• 1 DP1-457-156-156 Crossarm Shop Assembly
• DP1-457-156-156W
  Crossarm, 3-5/8" x 9-1/2" x 32'-0",
  Laminated
• 3 5860-3545
  Adjustable Spacer Filling Assembly,
  8-3/4" to 12-3/4
• 6 W4104-4S Bolt, Washerhead, 1/2" x
  10- 1/2", SN
• 12 W5050-3S Bolt, Washerhead, 5/8" x 5", SN
• 1 41058BS Bolt, Bent Double End 7/8" x
  8", 2SN, 2MF
• 2 41058BB Bolt, Bent Machine 7/8" x 6", SN,
  MF  

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BOM Example

• Project Bill of Materials
• Pine Lake HomeSites
• Cost Item Quantity Cost/Item Total  
• Site Development
• Clearing Grading 1.00 Each 59,429.00 59,429.0
  0 
• Paving 1.00 Each 114,549.00 114,549.00 
• Curb Gutter 1.00 Each 64,232.00 64,232.00 
• Sanitary Sewer 1.00 Each 158,810.00 158,810.00
• Storm Sewer 1.00 Each 61,277.00 61,277.00 
• Water 1.00 Each 63,602.00 63,602.00
• Entrance 1.00 Each 36,000.00 36,000.00
• Power Street Lighting 1.00 Each 9,300.00 9,30
  0.00
• Amenity 1.00 Each 270,000.00 270,000.00
• Contingency 1.00 Each 35,000.00 35,000.00
• Total Site Development   872,199.00   

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Screenshots of BOM Software
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Screenshots of BOM Software
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References

• Bozarth, Cecil C. and Handfield, Robert B.
  Introduction to Operations and Supply Chain
  Management. Pearson Education, Inc., Upper Saddle
  River, New Jersey, 2006. p.461.
• help.sap.com/saphelp_40b/helpdata/en/cd/daf2cd4ab0
  11d18a0f0000e816ae6e/content.htm
• www.grms.com/BillsofMaterial.htm
• www.feldmanengineering.com/BoM_Glossary.htm
• www.brooksmfg.com/bom.html
• www.planease.com/samples/unitsales/projectbill.htm