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The process of “kitting” has been around in fulfillment facilities for a long time. In recent years, the notion of kitting has become more popular as companies move to lean manufacturing to help streamline their operations.
What is kitting?
When multiple but related items are pre-assembled to create one, new, ready-to-ship product, that’s kitting. In manufacturing, for example, the kitting process will take one SKU (stock-keeping unit), combine it with another SKU and now a unique, third SKU has been created.
The opposite of kitting is known as pick-and-pack, which means individual parts are inventoried separately—may even be kept in different areas of the warehouse—brought together and packaged when a customer places an order.
What kind of products are good candidates for kitting?
Many businesses could think about kitting their products. It might be helpful to think in terms of “1+1 = 3”. In other words, when can bundling parts and products create a better experience for your customers and increased efficiency and revenue for you?
Creating sets is typically a perfect place for kitting. Those separate pieces of luggage can be sold separately or as a convenient travel set. Individual glassware is kitted into a matching 24-pc juice, highball and tumbler set.
Kitting can also give customers more opportunity to customize their products with just the options they want. For example, a bicycle aficionado could build his dream racing bike by choosing kitted “add-on’s.”
Examples of products that can work well with kitting include:
The list goes on!
How can kitting benefit my business?
Kitting increases your options for delighting customers and bringing in more revenue. You can create exclusive, packaged deals, discounted sets and “ride-along” or cross-sell offers. The best part is you’re not adding any warehouse costs because you already buy and stock these items!
Kitting increases efficiency and provides costs savings of the fulfillment operations. Parts are organized and assembled so they can quickly be sent to the line or shipping department, saving valuable time and speeding up delivery. With fewer individual pieces to ship, inventory and track, the overall assembly and fulfillment process is streamlined and more efficient.
How do I get started?
Companies can choose to do in-house kitting or go with third-party outsourcing. If you are already handling fulfillment in house, it shouldn’t be too challenging to handle kitting in house. You may need to purchase an updated inventory management system that can perform a range of critical functions your current one hasn’t been tasked to do.
Some companies that have their own fulfillment services still opt to use outsourcing for the lower-value work of creating kits, for overflow or seasonal work or to make more room on their warehouse floor.
The advantage of going with 3rd party fulfillment companies is that they will already have everything in place for proper kitting. Because handling this work is bread and butter for them, they will already have inventory management systems in place and can make value-added suggestions for improvements.
Who can help me?
We can help! Companies looking for an outsourcing partner in Cincinnati, Northern Kentucky and Southeast Indiana turn to Ohio Valley Goodwill because our Industrial Services division gives businesses access to an experienced, quality kitting operation.
Let’s talk! Contact us today to learn more and receive a complimentary tour of our Cincinnati-based facilities.