Have you ever ordered similar products together and received them in the same package, even when they are from different vendors? Do you know the advantages of doing this as a seller? This process is called kitting, and it is one of the best ways to save on shipping and packaging and contribute to the environment.
Let’s dive into the fundamentals of kitting and find out why it is essential!
- What Is Kitting?
- What Is the Difference Between Kitting and Bundling?
- Kitting in Logistics
- Kitting in Warehouse
- Kitting Operations
- Kitting Services
- Benefits of Kitting
- Kitting Process
- Need of Kitting in Fulfillment
- Kitting Software and Why Do You Need It?
- Under the Umbrella
- Fast Forward Your Kitting and Fulfillment Operations With Fulfillment Hub USA
- Kitting – Frequently Asked Questions
What Is Kitting?
With the rise in e-commerce, kitting has become a popular warehouse and shipping technique for order fulfillment. It helps in increasing profits and minimize costs.
In kitting, we pack and ship individual but related products together as a single bundle. If you have ordered multiple books together from any major e-commerce platforms like Amazon, Flipkart, you must be aware of this process; they bundle those books into one single packaging to save on packaging material and shipping costs.
What Is the Difference Between Kitting and Bundling?
Often used interchangeably, kitting and bundling are not always the same thing.
Bundling items is a generic term used when multiple SKUs are packed together to be sent as a single package. It is often used for promotional deals.
Kitting is more specific. It happens when a group of products requires a sequential order of preparation or packing before shipment. Products like subscription boxes often use this method.
On familiar ground, they both mean combining individual products to create a new SKU.
Kitting in Logistics
In logistics kitting, you bundle up multiple products into one ‘kit’ which is then forwarded to the customers. It is done to lower shipping costs, speed up the order-fulfillment process, and streamline shipment.
Kitting in Warehouse
Warehouses contain hundreds and thousands of products strategically placed to fulfill orders on time. Warehouse kitting is when your warehouse staff physically pick multiple products, bind them together into a single package, and forward it to ship. This new package has a unique SKU with information of all the products in it.
Kitting Operations involve the complete product process from receiving the order, picking, assembly to kitting and shipping. It ensures optimization of your fulfillment process while saving money. For smooth kitting operations, special training and a proper warehouse management system is necessary.
Many fulfillment companies (3PL) offer kitting services to reduce packaging for consumers and packaging and shipping costs for sellers. Outsourcing your kitting process to a fulfillment hub has many benefits, and it’s always a good decision to let pros handle the operations.
Benefits of Kitting
It offers various benefits to businesses, 3PL, logistics, and consumers.
Enhanced Warehouse Efficiency
Kitting improves warehouse management. Similar products are bundle and put together. It makes it easy for employees to locate the items when needed. It saves them a lot of time and makes the warehouse operations smooth.
Reduces Labor Cost
Using kitting as a material feeding system reduces the amount of work done when picking and packing products. This saves you time and reduces over-time costs.
Increased Product Sales
It helps in selling stocks that are slow-sellers. You can bundle products together and sell the ones with them that are at risk of becoming dead soon. This way, you save on inventory space, money, and your customers make larger purchases for value-addition with the main products. It is a great sales strategy as well.
Faster Shipping and Reduced Cost
The order-fulfillment process becomes faster with kitting. Products are kept together, which makes the picking, packing, shipping faster. This results in faster delivery and satisfied customers.
Shipping costs become less when multiple products are ship together. Additionally, when you partner with a 3PL, you will avail a lot of added benefits that they receive from shipping carriers.
One of the biggest challenges for e-commerce sellers is space management. When you kit products together, you save a lot on warehousing space, packaging, shipping, and work floor labor. It is one of the biggest advantages of kitting.
It is a simple process that requires bundling multiple products into one single unit.
Segregate Items That Form a Kit. There are many ways to do this. Separate them based on product use, theme, color, or any other common thread you can think of.
SKU Assignment. Individual products have their unique SKU. Once they are bundled, they represent a single product, and hence, a new SKU is assigned to a new kit. This is crucial to keep track of inventory and shipment.
Assembly. Products that are going to be in the kit need to be relocated to a place in your warehouse where your team can easily bundle them.
Sell and Ship. Once your kit is prepared, you can market it to increase your revenue and profits.
Need of Kitting in Fulfillment
Fulfillment companies offer various benefits to their customers. They use kitting as one of their prominent services as it provides multiple benefits to fulfillment hubs and their customers.
It reduces fulfillment costs. Picking and packing require a lot of effort and money, which can be reduced with this process.
It expedites shipping. When individual products are shipped, it takes more time to pack and deliver to the customer. Hence, kitting helps in speeding the fulfillment operations.
It saves storage and shipping costs. When products are bundled together, you save on warehouse space and lower your shipping expenses.
It enhances warehouse management. When you are packing multiple products to store and ship to one SKU unit, you have fewer SKUs to keep track of in the inventory, and fulfillment operations become trouble-free.
Kitting Software and Why Do You Need It?
An accurate inventory management system is necessary to keep operations on track and fulfill orders rapidly. Kitting Software is generally a part of inventory management software that tracks individual products and creates new SKUs for kits before shipping. There are many software’s available in the market. Here’s what you need to look at before investing in any kitting software:
- Make sure the software displays accurate, real-time inventory tracking for individual products and kits.
- The software should be able to maintain minimum re-order points and maximum limit for inventory storage. It helps in maximizing revenue and saves you from stock-out.
- Kit forecasting is an essential aspect of any inventory management software. The software should have the data of each component used in the kit. Moreover, it should be aware of the upcoming requirements to fulfill the orders.
- It should accurately have the details for every SKU, along with the data of products used in the kit creation.
When you invest in a software, you streamline your workflow and have more insights into your inventory. In addition, it helps you track products and kits and forecast better to reduce costs and increase sales. Hence, if you are an e-commerce seller, you should invest in effective kitting software.
Under the Umbrella
Kitting is a simple yet effective order fulfillment process that saves time and money and smoothens your inventory management. It is a crucial part of any fulfillment process and needs efficient management.
Fast Forward Your Kitting and Fulfillment Operations With Fulfillment Hub USA
We are your tech-driven 3PL partner. Our automated systems accurately provide you insights into your kit, inventory, shipping, and forecasting. Our software has various features, including inventory management (product and kit), returns management, order tracking, billing breakdown, data importing, automatic reship, and more.
With our multiple shipping carrier integrations and connections in the industry, we get the discounts that trickle-down for you and your customers. It is a win-win for all of us. So connect with our experts to begin your e-commerce journey!
Kitting – Frequently Asked Questions
- What is a kit in inventory?
A kit is a group of the individual but related products packed and shipped in the same box. It is a simple, easy, and effective way to store. It saves a lot of space, makes inventory easy to track, and helps in the speedy order-fulfillment process.
- What is eCommerce Kitting?
eCommerce Kitting enables sellers to combine multiple products and sell them together as one. The best example of this is subscription boxes. It helps them sell away the stock that can be dead soon, with added benefits of space, time, effort, and fulfillment costs saving.
- What are kitting fees?
Kitting requires more effort and time than a single product. Hence, companies charge more for it. The fees vary according to the products; for example, charges are higher for valuable and temperature-sensitive products. Generally, it varies between $30 and $50 per hour.
- What does a kitting specialist do?
Kitting requires special training. The foremost job of a kitting specialist is to make sure that the process is performed correctly and everything is updated in real-time for seller and consumer. Secondly, they must ensure kits are complete and ready to ship to their destination. Lastly, they manage components that will be a part of a kit and are responsible for smooth kitting operations.