A Bill of Materials (BoM) is an extensive list of raw materials, by-products, components, assemblies, and packaging material needed to make a finished product.

Inventory Management Software with Capabilities of Bill of Materials BOM
Inventory Management Software with Capabilities of Bill of Materials BOM

Anchal Thakur | BatchMaster ERP

Just Imagine, you are set to leave for a world tour. You plan to take two large bags full of clothes and essentials for any kind of weather condition. You consider yourself a smart traveler but actually, you are complicating your journey. Two large suitcases might weigh you down and create a financial burden as the cost of their transportation.

Rather you can travel light with a small luggage and a backpack. The money you save on the transportation of baggage can be utilized in investing on immediate requirements then and there, without carrying the excess items all the time.

The first case is risk-free but reduces the overall efficiency. While the second option has a progressive approach; get, just what you need. This way, you can change your course of action according to the circumstances.

The situation is identical to the excess inventory lying around in your warehouses, demanding manufacturer’s time, labor, and money. What you consider as an asset of your business, could become a liability in the form of inventory carrying cost.

Inventory is the lifeblood of your manufacturing business and must flow uninterruptedly wherever needed at the right time and in the right quantities.

Whereas, A Bill of Materials (BoM) is an extensive list of raw materials, by-products, components, assemblies, and packaging material needed to make a finished product. You can say that it’s actually a blueprint for product development from start to finish.

So to have excellently effective inventory control, manufacturers need to get a tight hold on BOM management. With an inventory management software along with BOM capabilities, you get to regulate the inventory flow like a pro.

Let get to know how BOM capabilities in the inventory management software make your business easier to manage:

  1. A BOM completed in all respect helps the production floor staff understand the assembly, processes, and procedures to obtain the final product. Without this, there are chances that products are manufactured incorrectly or not according to customer specifications.
  2. Since BOM allocates costs to every item of the product, right from scratch, the BOM document assists in estimating the actual cost of the finished product along with packaging material taking assembly costs into account.
  3. BOM saves both time and money of a manufacturer as it offers inventory control throughout the lifecycle of a product. It also instructs for every equipment, component, and step in the manufacturing process that allows to calculate accurate lead times and regulate the cash flow for inventory payments accordingly.
  4. Efficient inventory control is essential to minimize downtime, maximize productivity, and regulate product runs as it suggests the right amount of raw material to order. Too much inventory is equally risky as too little. The mistakes in procurement estimation can cost lost sales, lost customers, and lost brand image to the business owner.
  5. With the help of a BOM document prepared ahead of a planned production batch lists an all-inclusive measure of total assembly items and optimizes inventory management.

Thus an inventory management software assisted with BOM features enables better decision-making, boosts production efficiency, cost-effectiveness and helps in enhancing product quality.

One such ideal solution is BatchMaster ERP with an inbuilt inventory and BOM module that gets you on top of your inventory management. BatchMaster’s efficient BoM management furnishes the production floor with real-time traceability of all the materials, parts and products for achieving the minimum possible lead times and practicing just in time mode. The information obtained via BoM is fed directly into the system to further enhance inventory management and operational efficiencies.


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The content & opinions in this article are the author’s and do not necessarily represent the views of ManufacturingTomorrow

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