A bill of materials (BOM) is the recipe for a product: a list of every component and raw material, with the quantity needed to make one unit (or one batch).
Why a BOM matters
- Costing: it shows what a product should cost in material.
- Planning: it tells purchasing what to buy for a production run.
- Control: consumption can be compared against the standard.
- Consistency: everyone makes the product the same way.
A simple example
Finished product: Wooden stool (1 unit)
| Component | Quantity | Unit |
|---|---|---|
| Timber plank | 0.5 | m |
| Screws | 8 | pcs |
| Varnish | 0.1 | litre |
| Packaging | 1 | pcs |
To make 100 stools you need 50 m of timber, 800 screws, 10 litres of varnish and 100 packages.
Multi-level BOMs
A component can itself be assembled from other parts. A multi-level BOM captures this, so a sub-assembly has its own recipe.
Keep versions
Recipes change — a supplier changes, a part is replaced. Keep versions so past production is still explained by the recipe that applied then.
Common mistakes
- Forgetting scrap or wastage.
- Leaving out packaging or consumables.
- Using different units to buy and to consume without conversion.
- Editing a BOM without recording the version.
In Onyx Inventory
You list the components each finished product needs and keep versions as the recipe changes. A manufacturing entry picks the product, BOM and quantity; raw materials are consumed and production cost is recorded. See Onyx Inventory and Onyx Combo.
Frequently asked questions
What is the difference between a BOM and a recipe?
They are the same idea. "BOM" is the term used in manufacturing and ERP systems.
How does a BOM affect cost?
Multiply each component's quantity by its cost, and add them up. Add labour and overheads if you cost those too.
Do traders need a BOM?
Usually not. A BOM matters when you make or assemble products.
This guide is general information, not accounting, tax or legal advice. Rules and rates change, so confirm the current position with a qualified professional.