The fashion industry causes a total of 1.2 billion tons of CO2 equivalent per year – and thus more than shipping and aviation together. Against this background, the public demand for more responsible and sustainable business practices is becoming increasingly urgent. A 2018 Quantis study found that over 90% of these emissions come from four areas of activity: dyeing and finishing, stock preparation, yarn preparation and fiber manufacture. All process steps where the entire value chain depends on complete and accurate order estimates. The Bill of Materials plays a crucial role here: While an inaccurate BoM quickly becomes the main factor in unnecessary waste of resources, a thoroughly designed BoM can become the secret hero of your own brand sustainability.
We explain how an (in)complete composition of the bill of materials affects one’s own value chain, how IT solutions can improve the quality of the bill of materials and how this creates completely new potential for more sustainable action – especially with regard to the upcoming ones EU regulations.
What exactly is a Bill of Materials?
Whether it’s shoes, clothing, or accessories, a bill of materials is essentially a complete listing of all the items you need to make a product, and their respective quantities and costs—that’s why it’s often compared to a shopping list. And when we say complete, we mean it: every inch of a garment’s fabric and seams, as well as every intended zipper or button, should be included. Although each bill of materials should be tailored to the specific product, it typically includes the category of components (e.g., manufacture, cut, fasteners), their size/dimension, color, supplier, and quantity required. This way you keep a categorical overview of all material costs in order to better plan purchases and ultimately produce as resource-efficiently as possible.
Why is the parts list (bill of materials) so important for an intact value chain?
The Bill of Materials comes straight from the pen of a designer with their own illustrations and ideas about features, materials and colors. All of these specifications must be carefully translated by the product development teams into a well-defined, detailed bill of materials that allows actual material requirements to be accurately recorded. The product engineers then approve colors, patterns, body measurements, final adjustments and quality assurance, and prepare for handover to the suppliers.
The smallest errors can lead to significant cross-departmental disruptive factors and paralyze the operative value chain throughout the entire development cycle. Inaccurate quantity estimates can cause delivery bottlenecks and bring production to a standstill. In addition, inaccurate product costing impacts your return on investment (ROI) and subsequent strategic budget decisions, while unnoticed data entry errors can result in quality issues and customer returns.
Protecting your Supply Chain for the Future Live webinar (in English) on June 30, 2022 at 11 am (CET). Register now!
Why is a complete Bill of Materials so important to a brand’s sustainability?
Most fashion brands are constantly looking for ways to make their products and operations more sustainable, whether it’s in terms of external marketing, their own corporate values, or improved profit margins. In this way, a thorough and polished material balance becomes, in effect, the recipe list for designing a sustainable, responsible and transparent product.
This starts with the substitution of environmentally harmful materials with regenerative alternatives and their integration into the product design; continues in the careful choice of sustainable processing measures; and ends with the process integration of your suppliers in order to master the implementation and a transparent data transfer. Ultimately, it is the combination of all these measures that helps to produce and promote a truly sustainable product.
How can a Product Lifecycle Management (PLM) system facilitate the creation of accurate and complete BOMs?
Within a PLM system, much of the product documentation process can be automated, including the creation of accurate and complete BOMs. These can be carried over and adjusted from season to season to accommodate both minor and major changes and to prevent manual errors. In addition, through the collaborative platform design, PLM software enables all involved internal and external parties to provide and approve relevant product and process-related data.
Collaboration in a PLM system also means that your design and manufacturing teams work in the same platform environment, which enables early alignment between design intent and product realization. This way, designers and product engineers know early on whether design requirements are feasible and can offer alternatives before prototyping problems even arise. This enables fast and precise approval at an early stage.
Be ready for upcoming regulations – how sustainable is your supply chain?
Complete parts lists lay the foundation for a resource-efficient and stable value chain. But to achieve true sustainability, the entire digital ecosystem must be aligned with this goal. An undertaking in which many fashion brands are currently reaching their own operational limits.
In our next webinar, find out how a fashion brand can lay a solid foundation for this, also with regard to the upcoming regulations.
In the webinar you will learn how to optimize your own brand sustainability, create transparent supply chains – and why collaboration will determine the competitiveness of your brand.