Kitting packaging is one of the most valuable types of supply chain management solutions. Kitting solutions can help original equipment manufacturers (OEMs) or other parts suppliers fulfill customers' orders more accurately and efficiently. Kitting can also help OEMs reduce labor and shipping costs, improve shipping times, and keep warehouses more organized.
Kitting is an inventory management technique that involves combining multiple separate products with different SKUs into one product with a single SKU. Kitting systems combine items into kits based on the items' relationships to one another. For example, an OEM that supplies automotive parts might combine multiple parts into one product to form a kit that contains everything you need to patch a tire.
There is more than one variety of kitting. For example, material kitting is when a supplier combines multiple parts that are needed to manufacture something specific. On the other hand, a supplier could also combine multiple products in a way that creates a new product, which is called product kitting. There are many different ways businesses of all kinds use kitting to their benefit.
Some companies can provide kitting services to other businesses to help them take advantage of the benefits of kitting even if they don’t have the in-house resources for kitting. MSW provides comprehensive packaging, kitting, and labeling services for original equipment manufacturers and other kinds of manufacturers and distributors.
Kitting can create quite a few different benefits for manufacturers and distributors. For example, kitting can contribute to consistency. Combining items that go together can help reduce shipping errors and speed up packaging times because parts do not need to be selected and combined at the time each individual order is placed. Creating kits out of complementary products or materials can also simplify inventory management by consolidating the number of individual SKUs in an organization’s inventory.
Kitting Process Improvement
An effective kitting process can result in considerable improvements to inventory management for many kinds of manufacturers and distributors, including OEMs. Kitting can create a great deal of additional value for both the businesses supplying the kits and the customers purchasing them (these customers could be either other businesses or consumers, depending on the situation). Common kitting process improvements include the following benefits:
One benefit of kitting is that it enables organizations to consolidate products to save space. When a business kits multiple separate products together, it eliminates numerous separate SKUs and creates a new, different SKU for the kit. Selling items together under one SKU can help save space in the warehouse and significantly reduce the amount of packaging the organization uses, among other benefits.
Kitting can help organizations like OEMs reduce expenses by eliminating the need for workers to pick every part and package it one by one. Instead, kits are pre-assembled and ready to ship. This can help organizations reduce labor costs as well as improve productivity in warehouses in general, both of which can contribute to lower expenses.
When employees need to select every part and package them together by hand, mistakes are bound to happen from time to time. Human error is unavoidable, yet every shipment that’s sent out missing a part or with some other inaccuracy results in a poor customer experience. This can have serious consequences for the supplier. Kitting items that are commonly sold together instead of expecting employees to gather them by hand for every order can greatly reduce the probability of an incorrectly-picked shipment going out.
Increase shipping speed
Kitting can also translate to faster shipping times. All the time saved picking products and packaging them together means the shipment can go out faster and the customer can receive their order sooner.
When an organization is able to accomplish all the outcomes listed above, it often results in a higher bottom line. Kitting examples can improve efficiency in accuracy, which leads to better customer experiences, greater customer loyalty, and more repeat purchases.
Kitting And Assembly Solutions
Kitting parts for assembly can help save space in warehouses, reduce packaging costs, lower shipping times, and more. Here are a few examples of parts kitting best practices that organizations can use to maintain effect-house kitting and assembly solutions:
- Keep warehouses well-sorted and organized so that parts can be easily located and accessed for a smooth kitting process.
- Streamline warehouses to enable kitting to happen alongside other operations without creating bottlenecks and slowing down productivity.
- Maintain a specific area for kitting parts that is separate from the area where incoming parts are received and sorted.
- Integrate quality checkpoints at various points in the kitting process to verify each kit is assembled accurately.
- In the event an incomplete or incorrectly packed kit does get sent out to a customer, it can be helpful to have a designated plan in place for sending the necessary replacements as quickly as possible.
- Depending on the industry, organizations may want to assemble large quantities of kits in advance or offer kitting on demand.
Kitting and assembly can be accomplished in-house using best practices, but in many cases, it’s more practical to use kitting services. MSW can provide OEMs with packaging and kitting services covering a wide range of capabilities — including scheduling, assembly, warehousing, sorting, and inspection. Entrusting the kitting process to a service like MSW can enable an organization to reap all the benefits of kitting without any of the demand on internal resources or personnel.
Kitting In Warehouse
There are many different scenarios in which kitting could be beneficial. Different kinds of kitting sometimes work slightly differently or come with unique benefits. For example, what is kitting in warehouse settings good for? Kitting in a warehouse is a logistics technique that can help improve productivity in the warehouse. When products are pre-assembled into kits, it can reduce errors when workers are picking products and reduce packaging and shipping times. An effective kitting process can enable benefits like these without reducing efficiency in the warehouse or creating bottlenecks. The kitting process in warehouse settings usually goes something like this:
- Each individual item in the kit is collected from the warehouse and gathered in a designated staging area.
- Individual parts or products are combined into single packages at the staging area.
- A new SKU is created for the kit and it is ready to ship.
- When a customer orders a kit, it can be shipped immediately, and the customer does not need to wait for the kit to be assembled. (However, in certain cases, it may be more convenient to do kitting on demand.
Kitting And Fulfillment Services
Kitting and fulfillment are two related services because they both relate to ensuring customers receive the products they order. However, they are not the same thing. Kitting is often considered a part of the overall order fulfillment process. We’re going to break down the difference between kitting and fulfillment and answer the question: “what is kitting and fulfillment?”
Fulfillment is the overarching process of making sure customers are actually delivered the items they purchase. It involves all the work that goes into receiving orders, including receiving the orders, picking the parts that need to be included in the order, packing them, and shipping them to the customer.
Kitting is one specific part of the fulfillment process that involves organizing and packaging separate items together according to specific purposes. Kitting might happen at the very beginning of the fulfillment process before the customer even places the order so the order can be fulfilled more efficiently when it is placed, or it might happen at the time the order is placed if the supplier does on-demand kitting.
Kitting and fulfillment services can be performed in-house or outsourced to a third-party logistics provider. MSW can provide manufacturers and distributors with a full range of flexible, cost-effective kitting and packaging services. Third-party kitting services can offer a more efficient and less expensive method of kitting and packaging.