Bill of Materials

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

2. 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

3. 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.

4. 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)

5. Processes that utilize a BOM • Production • Materials planning • Product costing • Plant maintenance

6. How can a BOM be used in your organization? • Several software programs are available that store item information and prepare bill of materials automatically

7. 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

8. 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

9. 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

10. 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.

11. Structure of a BOM

12. What information is on a BOM? • Quantity • Item ID# • Description of Item • Cost of Item • Total Project Cost

13. 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.

14. 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.

15. Description of Item • Provides a check that the correct item is being ordered.

16. 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.

17. 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 + 5*4 + .5*5 = $37.50

18. 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.

19. 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

20. 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

21. BOM Example 161kV H-Frame Tangent QuantityCatalog 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  

22. 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 59,429.00  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 9,300.00 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   

23. Screenshots of BOM Software

24. Screenshots of BOM Software

25. 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/daf2cd4ab011d18a0f0000e816ae6e/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