If you are purchasing fabric by the yard or meter but using it by the square inch or square cm you need to enter it into your inventory in the same unit that you purchase it by so that the inventory will be able to calculate properly.
Let's use a practical example to demonstrate.
You purchase fabric by the yard and you create napkins by the square inch.
Let's say that 1 yard of fabric is 1 yard long by 1 yard wide and the napkins you create are 10 inches by 10 Inches.
First off lets calculate the fabric into square inches.
1 yard - 36 inches so 1 square yard = 36 * 36 = 1296 square inches of fabric.
So you enter 1296 square inches into your parts inventory for your fabric purchase.
Now your napkin.
10 inches * 10 inches = 100 square inches of fabric used to create 1 napkin.
So when you create a napkin you simply select your fabric as the part and enter 100 as the units used.
This will then deduct 100 from the total inventory of your fabrics 1296 square inches in inventory.