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Understanding Kitting and How It Can Benefit Your Business

Last updated on June 20th, 2023 at 09:51 am

Are you considering outsourcing the order fulfillment and production parts of your e-commerce business to a third-party company? 

If so, you are headed in the right direction, as doing it has significantly improved delivery times and customer service.

Your fulfillment company can do a lot more than pack and ship orders. It can also offer fulfillment kitting services.

What is Kitting?

A kitting process is a way to manage inventory in which items that go together are packed and sent as a single bundle.

A classic example is subscription boxes that have become more popular over the past few years. Instead of several companies selling their products separately, subscription box companies put all of their items in one box and sell it to subscribers. 

The whole process of putting together kits is an extra service with many benefits in eCommerce fulfillment. It boosts sales, makes customers happier, improves delivery accuracy, and cuts down on storage costs.

Kitting services in different areas

Third-party fulfillment firms offer kitting services in different areas to save money and ensure clients get as few shipments as possible.

In manufacturing, a third-party kitting company puts together the product that a customer has ordered. This saves you, an ecommerce business owner, a lot of trouble as you don’t have to put things together in-house.  

When you hire a kitting services provider, you not only avoid the stress of setting up systems but also keep prices low, free up your time, and focus on running your business.

What Does “Bundling” Mean in the Warehouse?

Before an item can be shipped, the warehouse kitting process involves finding several SKUs, putting them together into a single kit, and making a new SKU.

Kitting in Warehouse Management: Pros

Improved warehouse efficiency. One of the biggest benefits of kitting is that it makes picking and packing items easier. All the items in a kit are moved so they can be stored close to each other.

This is a good technique because you won’t have to look for things all over the warehouse. Kitting also saves time and money when the inventory is checked often.

Your e-commerce business may also benefit from warehouse kitting. 

Instead of sending small items like accessories in a separate package, you can use kitting techniques to combine them with larger items. 

You only need to be strategic in how you go about it and ensure that the larger objects don’t damage the smaller ones. This lowers your shipping costs and eliminates the need to charge for dimensions.

The process of putting together kits in a manufacturing business

In manufacturing, kitting means putting together bundles of parts used to make a product and putting them together ahead of time.

This lets an eCommerce business save money on storage, speed up packing, cut shipping costs, and keep better track of and manage its inventory.

How can kitting improve the efficiency of manufacturing?

Kitting speeds up the production process.

Kitting speeds up production by reducing the time needed to move materials and making it faster to pick and report. Since the pieces needed for the assembly line are already put together, you save time that would have been spent looking for raw materials on the shop floor.

All the workers have to do now is put together the final product. Before they start assembling the final product, they can also check the quality of each part. After all, they have the time. 

Kitting makes it easier to keep track of inventory.

Kitting makes it easier to locate parts, which is especially important when a product needs a lot of small parts. Each kit has a single SKU (Stock Keeping Unit) number, so you don’t have to look for each part. This makes it easier to find different parts.

Another benefit is that you know each kit makes one finished assembly. This is better than finding that you have most of the parts you need for an assembly but still need one or that one of the parts is broken.

Bringing down the production cost

When several items are put together in a kit, they take up less space in the warehouse because you only store what you need. This could cut down on how much you have to pay for storage. Kitting can also save you a lot of money on labor costs and other costs related to production.

Since you pay shipping costs for each kit instead of each item, you save on the shipping costs. 

Lastly, it’s much easier to figure out how much something costs to make when you know exactly how many parts are in each kit. This not only helps your books but also your pricing. 

Kitting and Assembly

When delivering furniture, entertainment systems, and other things that need to be put together after delivery, separate component kits are often used. If your business ships such products, you should find a shipping company offering kitting and assembly services.

Such a company gets the parts from different sources and puts them into kits before sending them to the final destination. Before they are sent out, the parts of these kits are kept separate and reassembled later.

Of course, the shipping companies attach a manual detailing how to reassemble the various parts after delivery.

You need to work with the right company for the best results when delivering this service. A good rule of thumb is to use a company like AMS that follows standardized processes. These processes help make sure that the kitting and assembly process is consistent and quick. This calls for you to work with companies with standard operating procedures (SOP) or standard work processes.

The company should also provide quality control checks that help find any mistakes or problems during the kitting and assembly process before the finished product is ready. Checks for quality control ensure that the final product meets the set quality standards.

The company should also routinely invest in training its workers on the proper handling and assembling of the various parts. The right training and ongoing support ensure that the workers have the skills and knowledge to do the kitting and assembly right. This helps improve productivity and cut down on mistakes. You can find out more about kitting and its benefits at https://www.amsfulfillment.com/what-we-do/kitting-assembly-solutions/.

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