Your product sold well and the order book looked healthy, yet the margin vanished. One component had crept up in price months earlier, and without reliable BOM software to reprice every product that uses it, nobody noticed. If that sounds familiar, you are not alone. Fortunately, the fix is simpler than you might expect.
What a Bill of Materials Is and Why BOM Software Beats Spreadsheets
A bill of materials (BOM) is the recipe for a product: every raw material, component and sub-assembly, with quantities and units of measure. Structures often run across several levels, so a finished item contains a sub-assembly, which holds its own parts. It excludes labour, so costing needs more than the list alone.
Spreadsheets may cope at first. Then reality takes over. Someone saves a copy for a special order and a price updates in one file but not in another. Soon, you have multiple versions and no confidence in any of them.
Linking BOM Software to Stock and Purchasing
A live BOM behaves very differently from a static file because it talks to the rest of the business. In Fusion Software’s Stock & Manufacturing module, for example:
- BOMs hold components and sub-assemblies, checked against current stock
- Shortfall reporting flags missing components before a job starts
- Purchase orders can be raised straight from the shortfall
- Completed manufacturing jobs consume components and add finished goods back to stock
Stock remains accurate without anyone re-keying numbers.
Costing: How a Price Change Reaches Your Margin
Margins leak when component prices change, but product costs don’t. Good BOM software carries each new purchase price into the cost of every product that uses the component, then shows the effect on margin before you quote again.Â
In Fusion’s software, the accounting module connects inventory valuation, purchasing, manufacturing activity and financial reporting. So, finance leads see the same numbers as production.
Make to Order vs Make to Stock: What Each Needs
Make to order starts when a customer places an order, so each job can carry its own specification and bill of materials. Make to stock builds standard items ahead of demand and ships from finished goods. Many manufacturers run both, so BOM software must handle either; Fusion’s BOM software creates manufacturing jobs for stock or customer demand.
| Need | Custom Jobs | Stock Runs |
|---|---|---|
| Planning | Quotes costed from the BOM | Forecasts and reorder levels |
| Costing | Actual cost per job | Standard cost, with variances |
What to Look for in Bill of Materials Software
The most important considerations when selecting the software are:
- Multi-level BOMs, with sub-assemblies and variants
- Versioning, so changes are approved and old revisions are traceable
- A live link to stock, purchasing, sales orders and work orders
- Costing that updates when prices change
- Batch and serial traceability
- Planning tools that expose shortages early
Bill of materials software should also grow with you. Fusion’s bill of materials software starts with stock management and adds manufacturing when you need it, so you avoid replacing processes later. Production planning software that shares one stock foundation keeps everyone working from the same figures.
If spreadsheets are costing you margin, it is time to see how Fusion’s Stock & Manufacturing management software links your bill of materials to stock and manufacturing jobs. Book a demo.
