Managing a busy warehouse can be complicated, especially when orders start piling up. When this happens, there are two alternatives: you can rush around to gather individual items from various shelves every time an order comes in (which is tedious), or have everything pre-packed and systematically organized.
The latter option is what fulfillment kitting services essentially represent. Many eCommerce businesses implement kitting to streamline their inventory management and order fulfillment.
Here, you’ll learn all the essentials there are to know about kitting, its benefits, and how to organize it.
What is kitting?
In a warehouse, we use the term “kitting” for the process of taking several related items and putting them together in one package, making it ready to be shipped as one unit. It’s a very common practice for things like product bundles.
Fulfillment kitting services help subscription box companies, gift basket retailers, big shops with volume discounts, and other online retailers:
- Save time and minimize errors (because you’re not scrambling to find each item whenever someone places an order)
- Simplify inventory management by having to manage fewer individual items.
- Minimize errors by ensuring that customers receive precisely what they requested without any mistakes.
For example, if you sell cosmetics, instead of selecting (for each order) a lipstick, a mascara, and an eyeshadow palette independently, you formulate a kit that encompasses all three products within a single box. When an order arrives, you can just grab the kit and dispatch it.
The differences between kitting, assembly, and bundling
All of these terms carry the idea of combining items, so they are often confused. However, they serve different purposes:
- KITTING accumulates various items into a single package, but each item remains distinct. Although the items are grouped together, they are not physically connected.
- ASSEMBLY is the process of combining parts to forge a new, unified product. For example, when one assembles a frame, wheels, and pedals, you get a bicycle.
- BUNDLING is a marketing term for putting products or services together into one package to make a sale, usually at a discounted price.
Different types of kitting
Kitting can be implemented at different stages in the supply chain:
- Manufacturing stage
- During warehouse fulfillment
- Tailored for specific needs like subscription boxes or custom orders.
Here is what each of these kitting types means.
Warehouse kitting
Warehouse kitting means you collect all the components that comprise a given order from within the warehouse and pack them into one. Together, kitting and fulfillment make order fulfillment efficient, simple, and fast.
Manufacturing kitting
Manufacturing kitting is the process of collecting all individual parts required for a specific assembly or production job and packaging them in a kit. The kit is then taken to the assembly line or area where that particular item will be produced.
In other words, if there is an assembly for a certain product, all the screws, bolts, and parts required for that product are put into one kit so that the worker will have all the things they need in one spot.
Subscription-box kitting
Subscription box fulfillment kitting is a service where various products are compiled together into a box that is mailed on a recurring basis to subscribers. Companies offering curated experiences, such as beauty products, snacks, or books, utilize this method. Items are selected each month, carefully packed along with others, and sent to the customer.
Custom kitting
Custom kitting involves creating specialized kits tailored to individual customer needs or specific projects. This includes selecting and packaging products based on customer specifications or unique tasks.
For example, a company might compile a custom kit of tools and materials for a specific repair job. Alternatively, customers can independently assemble their own kits, if there is a corresponding option at the retailer’s website.
The steps of a fulfillment kitting process
The nature of kitting projects varies widely from one business to another. In some cases, a full kitting operation might be as simple as affixing a label to each unit of a particular product. In contrast, other projects may involve more complex tasks such as unpacking items, assembling containers, and carefully arranging multiple components.
Despite these differences, most eCommerce businesses follow these basic steps when creating kits:
Step 1: Plan the kit
First, you have to decide which of the SKUs in your existing stock will make it into the kit. It’s normal to compile things that are related to each other and have the same purpose or vibe.
The main point of a kit is to balance value and convenience — including items that are convenient to buy at once.
A common example is grouping a smartphone with a compatible case and screen protector – which are almost always kitted together. Fulfillment-wise, these phone accessories are great for kitting since they are small, light, and pack together easily. Plus, you can store them all in the same place.
Step 2: Link components to a kit
Next, you tie all components in the kit to one new, unique SKU. You must ensure your inventory system reflects exactly what components are in that kit and how many of each are required to make up the kit.
By doing this, you create a comprehensive record that allows you to track both the number of complete kits and individual parts simultaneously.
Step 3: Assemble the kit
This is where the actual “kitting” occurs, where several items come into one. During this stage, all components that make up a kit are collected in a single package or box.
Once the components are positioned within the box, the kitter seals and secures the container. The sealing process is needed to keep items in place during shipping and to maintain the kit’s presentation. Once it is sealed, the kit is ready and prepared for shipping.
Step 4: Finalize and store
In this step, you complete any final touches on the kit, such as adding labels or barcodes.
Stock the finished kits within a certain area of your warehouse by logically organizing them for efficient retrieval during the order-fulfillment process, such as by SKU, product type, or expected demand.
Lastly, be sure to update your inventory management system to reflect the new quantity of completed kits available for sale while updating your inventories for the individual components in the kits. This step is necessary in order for your inventory records to be accurate.
Advantages of warehouse kitting for online retailers
Customers appreciate kits for their affordability and the joy they bring when unboxing. As a business owner, you’ll find kitting equally beneficial because of:
- Warehouse space optimization: By bringing together several SKUs into one unit, kitting decreases the general footprint that a product or good would require for storage.
- More quality control: Kitting usually includes additional quality control measures, where items are examined before kitting. It serves as protection, enabling you to catch manufacturing defects or inconsistencies early.
- Accelerated order fulfillment: The order can be processed much faster. This efficiency not only cuts labor costs but enhances overall productivity by ensuring customers get orders in no time.
- Expedited shipping process: When you use kits, order prep time is drastically reduced, allowing for quicker shipping. In some cases, kits can be pre-packaged and ready to ship with minimal or no additional packaging required.
- Improved sales and customer experience: A beautifully packaged kit will be a treat for the customers, which is more likely to lead to repeat business.
Get reliable kitting and fulfillment services with ShipTop
While helpful, kitting can get complicated. Creating new SKUs and ensuring accurate counts of inventories can quickly become a challenge.
Many eCommerce businesses simplify kitting by using a third-party logistics provider. Using advanced inventory management software, these partners can easily update the unit counts, and reduce error, and administrative effort.
ShipTop’s kitting fulfillment services follow industry best practices. All you need to do is:
- Specify your kit items and quantities
- Make a kitting request through the ShipTop dashboard
- Let us handle kit assembly and SKU updates.
Want personalization options related to packaging, boxing, sticker application, or similar? Our team is at your disposal as we also offer custom kitting services.
Alongside the fulfillment kitting services, ShipTop also offers order fulfillment operations for various DTC and B2B companies, ensuring efficient processing, picking, packing, and shipping. Learn more about kiting and order fulfillment services, prices, and operations by getting in touch with our team.
