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7 Ways to Optimize Your Bills of Materials

June 23, 2026 by
7 Ways to Optimize Your Bills of Materials
hannah@kapwamarketing.com

A Bill of Materials (BoM) may look like a simple list of components, but in Odoo, it drives everything; from production planning to cost calculation. A poorly structured BoM can lead to stock shortages, inaccurate costs, and delayed orders. The good news is that most BoM issues are easy to fix with a few smart optimizations.

Here are seven practical ways to improve your Bills of Materials in Odoo.

1. Choose the Correct BoM Type

Odoo offers different BoM types: Manufacture, Kit, and Subcontracting. Using the wrong type can break your workflow.

Example:

  • A gift basket should use a Kit BoM.

  • A product assembled in-house should use a Manufacturing BoM.


How to set it:

  1. Go to Manufacturing → Master Data → Bills of Materials.

  2. Click Create.

  3. Select the correct BoM Type.

  4. Save and test with a sample manufacturing order.

2. Keep Component Data Clean and Structured

Messy component data leads to confusion and errors.

Bad example:

  • “Oak plank”

  • “Wood – oak”

  • “OAK 2x4”


Better approach:

  • Use a standard naming format like:

    WOOD-OAK-PLANK-2X4

Group components logically:

  • Structural parts

  • Fasteners

  • Finishing materials

Clean, consistent data makes production easier to understand and maintain.


3. Use Multi-Level BoMs for Complex Products

Avoid putting dozens of components into a single flat BoM. Instead, create sub-assemblies.

Example: Laptop production

Flat BoM (hard to manage):

  • Laptop

    • Motherboard

    • CPU

    • RAM

    • Screen

    • Keyboard

    • 40+ more parts


Multi-level BoM (optimized):

  • Laptop

    • Main Circuit Assembly

      • Motherboard

      • CPU

      • RAM


    • Display Assembly

      • Screen

      • Frame


    • Input Assembly

      • Keyboard

      • Touchpad


How to set it up:

  1. Create products for each sub-assembly.

  2. Create BoMs for those sub-assemblies.

  3. Add them as components in the main product BoM.

This improves reuse, traceability, and maintenance.


4. Get Quantities and Units Right (Or Pay the Price)

Incorrect units can cause serious losses.

Real-world scenario:

A company used “boxes” in one BoM and “sheets” in another. A manufacturing order consumed 100 boxes instead of 100 sheets, causing:

  • Material waste

  • Production delays

  • Manual inventory corrections


Prevention tips:

  • Standardize units across products.

  • Use Odoo’s unit conversion feature.

  • Audit BoMs monthly for inconsistencies.


5. Use Multiple BoMs for Flexibility

Sometimes one product needs different materials or processes.

Use cases:

  • Seasonal material changes

  • Premium vs. standard versions

  • Backup suppliers


How to set it up:

  1. Open the existing BoM.

  2. Click Action → Duplicate.

  3. Modify components in the duplicate.

  4. Select the appropriate BoM when creating a manufacturing order.


This allows quick adjustments without disrupting production.


6. Add Operations and Work Centers

A BoM is not just about materials, it should reflect the production process.

Example workflow:

  1. Create work centers:

    • Cutting Station

    • Assembly Table

    • Quality Check


  2. Open the BoM.

  3. Go to the Operations tab.

  4. Add each step with its work center and duration.


Benefits:

  • Accurate production scheduling

  • Realistic cost calculations

  • Step-by-step shop floor instructions


7. Review and Update BoMs Regularly

BoMs should evolve with your processes.

Quick maintenance schedule:

  • Monthly: Check top products for changes.

  • Quarterly: Audit all active BoMs.

  • Annually: Review engineering changes and costs.


Red flags:

  • Frequent manual adjustments

  • Stockouts despite planning

  • Cost differences over 10%

Conclusion

Optimizing your Bills of Materials doesn’t require complex changes. By choosing the right BoM type, structuring components properly, using sub-assemblies, and keeping data accurate, you create a more reliable manufacturing system.

A well-optimized BoM leads to:

  • Fewer planning errors

  • More accurate costs

  • Faster production workflows


In Odoo, a clean BoM isn’t just good practice; it’s the key to efficient manufacturing.