Before starting to manufacture or disassemble products, we need to make sure that we have bills of materials (BOMs) for these products. The BOM specifies the component products that make up the larger product, and any costs due to labor and overheads. Assembly BOM is intended to be used for simple assembly operations such as joining together multiple items in a pack or kit, or disassembling a case of stock into its component units.
NOTE: This article covers the bill of materials functionality for assembly and disassembly items. Cin7 Core also supports more complex bills of materials and production processes with the Advanced Manufacturing module, which can be added to your subscription. See Introduction to the Advanced Manufacturing module for detailed information.
See Product management - Creating a product (necessary)
Users require the user permission Inventory → Products and families and Inventory → Product - Bill of materials in order to add and edit the BOM for a product and enable/disable auto-assembly.
Table of Contents
- Create an item with bill of materials
- Bill of materials settings
- Import/export bill of materials
- View availability of BOM components
Create an item with bill of materials
The assembly/disassembly function can only be used with items that have a bill of materials showing their component parts. The components of the assembled product must already be created to add them to a bill of materials.
- When creating a new product or editing an existing product, check the Bill of materials box in the document header.
- This activates the bill of materials tab below. Use + Component to select the component products from your inventory. Items of type stock and non-inventory are added here.
- Enter the quantity of each component product that makes up the larger component and the Quantity to produce (1 is the default).
- Enter a disassembly cost percentage, wastage percentage and wastage quantity if required (see below for more information.)
- Total Cost and Cost per unit are estimated using either Average Cost, Latest Purchase Price or Fixed Purchase Price. These values cannot be changed manually. Note that these are for reference only, actual costs will be calculated according to the product's costing method (FIFO, FEFO, etc.).
- Service items associated with the assembly/disassembly can be included by clicking + Labour and Overheads. It is required to include an Expense Account for these charges.
- Save the product to complete.
Bill of Material Settings
When this check box is applied the finished good will be produced automatically after the sale order is authorised, assuming there are enough components in stock.
When this check box is applied the products are disassembled automatically after the purchase order for them is completed. Auto-disassembly is only recommended in the case where you do not sell the assembled product. Only FIFO, FIFO-Batch, FIFO-Special and Special-Batch costing methods support auto-assembly/disassembly.
Quantity to produce
Enter the yield for the BOM. 1 is the default.
Assembly Instruction URL
Enter a URL showing assembly/disassembly instructions for the product, if applicable.
Cost is estimated using:
Latest Purchase Cost
Fixed Purchase Cost
The Average Cost, Latest Purchase Cost or Fixed Purchase Cost of the BOM components is used to estimate the cost of the finished costs.
NOTE : This is for your reference only. Total cost in BOM is an estimate only. The actual cost of finished goods will be calculated using the costing method of each individual component and can vary from "Total" cost displayed in the BOM. Actual costs associates with finished goods can be seen using the Finished Goods Analysis Report.
Wastage % or Wastage Quantity (if applicable)
Wastage % and Wastage Quantity are mutually exclusive. If some of the components are wasted during assembly, use these fields to include that information.
Disassembly Cost %
Indicates what percentage cost each component product makes up of the parent product.
By default DEAR splits the cost of the parent product equally between product lines in disassembly. However you can set rules on how DEAR needs to distribute the cost of the parent product among the components. The total must equal 100%.
Example: Product A is disassembled into 2 x Product X and 1 x Product Y. If product A has $100 cost, the default settings in DEAR will set $50 for Product X line, which will be split among 2 items giving the cost of $25 per instance of Product X and $50 for Product Y.
Suppose that you wish to set your own rules. You estimate that the cost of the product Y will be $80 and the cost of the product X will be $10 each. Your disassembly cost percentage will be 20% for the first line (product X) and 80% for the second line (product Y).
Labour & Overheads
Service products are added to the BOM in this section. Add Quantity, Expense Account used to accumulate these expenditures and Price Tier used as a cost basis. If you do not have a standard rate for the Expense, the actual amount can be input during production.
Import/Export Bill of Materials
BOM details can be imported in CSV format via the Inventory module, or exported, edited, and re-imported for fast bulk editing. Multiple product BOMs can be imported at once.
Edit BOM Details in Bulk:
- Navigate to Inventory -> Products and select Export -> Bill of Materials.
- A CSV file containing all products with Bill of Materials will be generated.
- Make any changes within the CSV file (see below for explanation of each header). Supported changes include adding/deleting components, changing component quantities, changing wastage and cost percentage details, etc.) then save.
- Reupload the saved file by selecting Import -> Bill of Materials.
NOTE: The DELETE Action will delete components from a product, it will not delete the product itself. To delete products, see Deprecate and Delete Products.
Import Bill of Materials:
- Navigate to Inventory -> Products and select Import -> Bill of Materials.
- A blank BOM CSV file will be generated. Add the BOM details (see below for explanation of each header).
- Upload the saved file.
NOTE: BOM components must already exist as products in DEAR before they can be added to a Bill of Materials.
Bill of Materials CSV Headings
Action: (optional) Action column can have two possible values: Delete or Create/Update. If left blank, "Create/Update" is assumed.
ProductSKU: (required) Product SKU which BOM this line refers to.
ProductName: (optional) Product Name which BOM this line refers to. This field is used for information purposes only.
ComponentSKU: (required) Component SKU identifying the product used as a component to manufacture the product specified in the ProductSKU field. Should be unique for the same ProductSKU value.
ComponentName: (optional) Name of the product identified ComponentSKU field. This field is used for information purposes only.
Quantity: (required) Quantity of the component in BOM.
WastageQuantity_ForStockComponentOnly: (optional) Additional wastage quantity of the component in BOM. WastageQuantity_ForStockComponentOnly and WastagePercent_ForStockComponentOnly fields are mutually exclusive.
WastagePercent_ForStockComponentOnly: (optional) Additional wastage % of the component in BOM. WastageQuantity_ForStockComponentOnly and WastagePercent_ForStockComponentOnly fields are mutually exclusive.
CostPercentage_ForStockComponentOnly: (optional) % of the cost allocated to this component when disassembling product specified in ProductSKU.
PriceTier_ForServiceComponentOnly: (required for Service components) Identifies a sale price tier of the service to use when calculating Labour and Overheads related to production.
ExpenseAccount_ForServiceComponentOnly: (required for Service components) Expense account code or name to use to generate transactions related to this Service component.
View availability of BOM components
Please use the BOM Component Details report to view a table of products in your inventory with an assembly BOM, each BOM product's components and component quantity in stock, available and on hand. Use this report to see what components are required for a parent product and whether you have enough stock at specific locations to produce the parent product.
The report can be filtered by assembly BOM products in/not in a sale and available component quantity.
NOTE: If you wish to use this report to show all of the BOMs / BOM components not related to Availability/On Hand quantities, filter by one location (doesn't matter which location) and save the layout. This will give the BOMs and BOM components in a simple format.