What Is a Bill of Materials (BOM)?
A bill of materials (BOM) is a complete list of the raw materials, components, and sub-assemblies needed to build one unit of a finished product, with the quantity and unit of measure for each. Manufacturers use it to plan purchasing, schedule production, and calculate product cost.
What Does a Bill of Materials Include?
Each line of a BOM describes one item that goes into the product. Most BOMs include these fields:
| Field | What It Records |
|---|---|
| Part Number | A unique ID for each component, so the same part is never entered twice. |
| Description | A plain-language name for the part. |
| Quantity | How many are needed to build one parent unit. |
| Unit of Measure | Each, pounds, feet, liters, and so on. Items sold by actual weight use catch weight. |
| BOM Level | Where the item sits in the product structure (0 = finished product). |
| Procurement Type | Whether the part is purchased or made in-house. |
| Unit Cost | Used to roll up the total material cost of the finished product. |
Bill of Materials Example
Below is a simplified multi-level BOM for one wooden dining chair. The seat is a sub-assembly with its own components, shown at level 2.
| Item | Part No. | Qty | Unit | Source |
|---|---|---|---|---|
L0Dining Chair, Oak | CH-100 | 1 | EA | Finished good |
â””L1Chair Leg, Oak | LG-210 | 4 | EA | Purchased |
â””L1Backrest, Oak | BK-220 | 1 | EA | Purchased |
â””L1Seat Assembly | ST-300 | 1 | EA | Made in-house |
â””L2Seat Panel, Plywood | PN-310 | 1 | EA | Purchased |
â””L2Foam Cushion | FM-320 | 1 | EA | Purchased |
â””L2Upholstery Fabric | FB-330 | 0.5 | YD | Purchased |
└L1Wood Screw, #8 × 1.5" | SC-400 | 16 | EA | Purchased |
â””L1Clear Finish | FN-500 | 0.1 | L | Purchased |
To build 200 chairs, manufacturing software multiplies each line by 200: 800 legs, 3,200 screws, 100 yards of fabric, and so on.
Types of Bills of Materials
BOMs are grouped by who uses them and how much of the product structure they show.
Engineering BOM (EBOM)
The product as designed, usually created from CAD drawings by the engineering team.
Manufacturing BOM (MBOM)
The product as built, including packaging, consumables, and everything needed to ship it.
Sales BOM
Defines kits and bundles sold as one item, whose components are pulled at order time in order management.
Configurable BOM
Holds options such as size, color, or finish, and builds the right component list per order.
Single-Level vs. Multi-Level BOM
| Single-Level BOM | Multi-Level BOM | |
|---|---|---|
| Structure | One flat list of parts | Parent-child tree of assemblies and parts |
| Best For | Simple products and kits | Products built from sub-assemblies |
| Change Impact | Each BOM updated by hand | Change a sub-assembly once, every parent updates |
| Costing | Material cost only | Cost rolled up through every level |
How to Create a Bill of Materials
- 1Define the finished product. Give it a part number, description, and unit of measure. This is level 0.
- 2List every direct component. Include parts, raw materials, and consumables such as fasteners and finishes.
- 3Group parts into sub-assemblies. Anything built separately before final assembly gets its own BOM at the next level down.
- 4Set quantities and units. Record the amount needed per single parent unit, including expected scrap.
- 5Mark each part as purchased or made. This tells planning whether to create a purchase order or a work order.
- 6Review, approve, and version it. Store the BOM in your ERP system so production, purchasing, and accounting all work from the same revision.
Why an Accurate BOM Matters
Accurate Product Costing
Roll up component and labor costs in financial management to see what each finished unit really costs to make.
Material Planning
Turn sales orders and forecasts into inventory and purchase requirements for every component.
Consistent Production
Give the shop floor one approved build list so every unit is made the same way.
Change Control
Revise a component once, and every affected product and work order picks it up.
Common BOM Mistakes to Avoid
Most BOM errors show up later as shortages, rush orders, or product costs that don't match the books.
Leaving Out Consumables
Glue, fasteners, finishes, and packaging are easy to skip, but they still run out and still cost money.
No Scrap Allowance
If the BOM assumes zero waste, every run comes up short and purchasing keeps reordering.
Multiple Versions in Spreadsheets
When each team keeps its own copy, production builds from one revision while purchasing buys for another.
EBOM and MBOM Out of Sync
Design changes that never reach the manufacturing BOM lead to parts that are ordered but no longer used.
Which Industries Use Bills of Materials?
Any business that builds, assembles, blends, or kits products from other items uses a BOM. The most common are:
Manufacturing
Discrete products built from parts and sub-assemblies, from equipment to electronics.
Food Services
Recipes and formulas that set ingredient quantities for each batch or prepared meal.
Health & Beauty
Formulations plus packaging components such as bottles, caps, and labels.
Apparel
Fabric, trims, zippers, and labels specified by style, size, and color.
Furniture & Home Decor
Frames, panels, hardware, and finishes combined into finished pieces and sets.
Distribution
Kits and bundles assembled from stocked items and sold under a single SKU.
Managing BOMs in Kechie ERP
Kechie Manufacturing supports multi-level BOMs connected directly to inventory, procurement, production, and accounting. When a work order is released, Kechie reserves the components listed on the BOM, flags shortages for purchasing, and rolls material cost into the finished item. Related features include lot tracking for component traceability and catch weight for items sold by actual weight.
Frequently Asked Questions
What is a bill of materials in simple terms?
A bill of materials is the recipe for a product. It lists every raw material, part, and sub-assembly needed to build one unit, with the quantity and unit of measure for each.
What is the difference between a BOM and a routing?
A BOM lists what goes into a product. A routing lists how it is made: the operations, work centers, and time required for each step.
What is a multi-level BOM?
A multi-level BOM shows a product's full structure, including sub-assemblies and the components inside them, arranged in parent-child levels.
What is the difference between an EBOM and an MBOM?
An engineering BOM (EBOM) reflects the product as designed. A manufacturing BOM (MBOM) reflects the product as built, including packaging, consumables, and production-specific parts.
What is a phantom BOM?
A phantom BOM describes a sub-assembly that is built and used immediately in the next step, so it is never stocked. Planning passes its components straight through to the parent item.
How do you calculate BOM cost?
Multiply each component's quantity by its unit cost and add the lines together. In a multi-level BOM, cost each sub-assembly first and roll it up into the parent, then add labor and overhead for the full product cost.
Who creates and maintains the BOM?
Engineering usually creates the first BOM. Production, purchasing, and cost accounting then maintain it, ideally in one shared ERP system so every team uses the same version.
Can a distributor use a BOM?
Yes. Distributors use BOMs to define kits and bundles, so selling one kit SKU automatically deducts each component from inventory.
Related Guides
See Multi-Level BOMs in Kechie ERP
Build BOMs, plan material requirements, and track work orders on the shop floor in one cloud platform.