What is BOM and how production bottlenecks can be avoided using SAP Business One?

13 February 2019 5 MIN READ

The manufacturing world is in a complex landscape but this industry is the most important as any other industry. Whether it is manufacturing drugs, clothes, automobiles part or any other, we cannot understate its importance. Keeping the dynamic nature of this industry replete with head-on challenges of production, sales, quality, quantity & delivery, this industry has some amazing prospects to grow if all operations are automated.

This is an era of change and manufacturers need to be on the same page as of the digital transformation. One thing that hasn’t changed is the importance of the bill of materials (BOM) accuracy. Equally important is to have a system in place that ensures the accuracy of bills of materials.

But what exactly is a Bill of Materials (BOM)?

Commonly referred as product structure, or associated list, BOM is a comprehensive inventory of the raw materials, assemblies, sub-assemblies, intermediate assemblies, parts, components, sub-components, and the associated quantities of each needed to manufacture a product.

In general, for a company to produce a BOM report, they need to have the following particulars.

  • Parent Item
  • Component or Assembly
  • The quantity of the components required to construct the parent item
  • Scrap Factor/yields
  • Routing Operation


Why Automating BOM is Important

The problem with managing BOMs with spreadsheets or excels is that it becomes really difficult to keep a track of inventory and production lines. The result is a disconnected system that leads to production bottlenecks, miscommunication, confusion and inaccurate raw materials requirements.

How SAP Business One can help you manage and automate BOM?

Effortlessly manage bill of materials with best ERP for small business. Managing and maintaining any BOM can pose a different set of complexities and SAP B1 software can help you with better BOM management. The following benefits can be observed if you bring SAP Business One to manage your bills of materials.

a. Real-time access to inventory

One can have real-time access to inventories and gauge as what is in stock and what they will need to order.

b. Gives a complete revision control

With SAP B1, it is easy to create change and update the bill of materials. This gives a complete revision control while also rendering the ability to track changes. It also eliminates the errors that can occur if manual processes are involved.

c. On-time insights to inventory

With SAP Business One, the purchasing team will receive real-time inventory requests from BOM database instead of having to wait for individual spreadsheets to be distributed. Not only does this process reduce the possibility of conflicts, confusion but also save considerable time.

d. No delay in production

With BOM management at its place, manufacturing firm is prepared well in advance with its execution. This reduces the preparation time that manufacturing takes in an account and there is no delay in production side as everything is available on time. Further, it helps you to save your company time by expediting things which were earlier not possible with the traditional legacy system.


If you are in a manufacturing business you would want to make your life a little easier by investing in a robust ERP software such as SAP Business One.

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About the author

Nidhi Batra

Nidhi Batra is a marketing and brand communication professional with 10 years of experience working in the dynamic B2B marketing environment. She strategizes, writes, reviews a variety of content for demand generation and sales support activities. Having a Master’s in English from Delhi University, she knows how to navigate her readers on insightful journeys with her SAP published blogs and thought leadership content.

Follow me on LinkedIn to stay updated on the latest industry trends & technology update

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