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Former Member
Feb 23, 2011 at 10:40 PM

Follow-up question on BOM production and consumption of same item


Awhile back, I asked the question about whether it made sense to have a BOM structured to simultaneously produce and consume an item.

Thanks for the help and it does what I thought it should. We have a local difference of opinion on the consumption of primary components, though. To attempt to ensure that we account for the bleed-off of materials into a vacuum system, we set up a BOM like this

Material A 498.379

Material B 332.253

Material C 14.914

Material D 22.371

Material E 64.317

Material F 103.570

Material F -35.804 (This is the quantity vacuumed away, treated as by-product.)

to cover a recipe card structured like this

Material A 481.150

Material B 320.775

Material C 14.400

Material D 21.600

Material E 62.100

Material F 100.00

The difference of opinion is whether to recognize the reclaimed material (Material F) at all on the BOM, with a minority saying that we will not consume (and therefore not order) enough of materials A through E. They say that "you have to put the same amount of good ingredients in as you produce because it's a closed loop system".

So the other approach would be a BOM like this

Material A 534.252

Material B 357.852

Material C 15.840

Material D 23.760

Material E 68.310

The material reclaimed (Material F) is sourced not only from this particular vacuum system, but from other vacuum systems outside the blending operation.

It seems to me that the first approach is correct, because we recognize consumption and production of the reclaimed item, and proportionately increase the component items to recognize that more are needed than will go out as good product. Even the reclaim becomes reclaim. The amounts vacuumed off seem to be consistent at 3.57%.

Which approach is correct?