E-commerce continues its meteoric growth. More than 12 million e-commerce businesses operate around the world. Staying competitive in this crowded market is essential for your company’s success.
Kitting gives your online e-commerce store several advantages. You can optimize order fulfillment and increase profits. You can fulfill orders faster and more accurately.
Learn more about kitting and how to implement it in your e-commerce business.
What Is Kitting?
In its most general definition, kitting refers to preparing inventory for shipment to customers. This could mean taking each SKU from the manufacturer’s packaging, doing a quality control inspection, and labeling the item. Kitting puts inventory into its pickable form for order fulfillment.
Kitting more often refers to full kitting or product bundling. The kitting process gathers several products and packs them together to sell them as a single SKU. It helps streamline the fulfillment process for an e-commerce business.
Types of Kitting
You can use kitting in several different ways. Product bundles can include:
- Private label kits
- Subscription boxes
- On-demand, ready-to-order sets
In a private label kit, you take products from different manufacturers and group them under your own label. This type of kitting is common with seasonal or hobby items. Offering everything your customers need in a complete package makes them more likely to buy from your e-commerce site.
This year, the subscription box market will be worth more than $31 billion.
Subscription boxes contain a curated collection of products. You ship them out to customers on a recurring basis, such as weekly or monthly. You may determine the frequency based on how often the product needs replacement or let the customer choose from different subscription plans.
You create a new set of items for each subscription period. They may be items that are new to the customer or products to replenish the customer’s supply.
A ready-to-order set lets the customer choose their own bundle. You can give customers a choice of quantity, color, or other features. Your team assembles the kit when the customer places their order.
Best Practices for e-Commerce Kitting
Following some best practices will help kitting go more smoothly for your online e-commerce store. The kitting process focuses on efficiency in bundling items as quickly as possible.
Choose Items for Your Kits
First, you need to decide what you’ll include in the kit. You can group items based on their use, theme, product similarity, or other reasons. The kit will need an SKU.
Assemble the Kits
Assembling the kits is the most time-consuming step in the process. Your team gathers all the products that make up the kit. They ensure that each item is in its final form for the customer. Finally, they place the items into a designated container.
Storing the components of the kit near each other in the warehouse is ideal. This reduces the time workers spend gathering the parts.
Inventory management is essential for successful kitting. You need all the parts for each kit, or workers can’t start making it. When the items are available, workers pick them and bring them to the assembly area.
Packers assemble the products into a complete kit. They then set the kit aside until shipping.
Market and Sell the Kits
The final step is to create a product listing on your e-commerce site. When orders come in, the kit will be picked from its location and sent to the packing station. It only needs a shipping label to go to the customer.
Benefits of Kitting for e-Commerce
Full kitting has many benefits for your e-commerce business. It’s handy if you have supply chain issues or use a lean production method.
Kitting can streamline your fulfillment process. It can increase sales and give you a higher profit margin.
Kitting groups multiple items into a single container. After the kit is assembled, it’s stored in a single location in the warehouse. You can optimize storage space.
Locating and picking a kit from a single location is more efficient than picking items across the warehouse.
Faster and More Accurate Fulfillment
Warehouse workers only need to pick one item to fulfill an order for a kit. This is faster and easier than picking multiple products in the warehouse.
The kit can ship more quickly because less preparation is necessary. Kits that are packaged in boxes may not need any additional packaging. They’re ready to go as soon as a shipping label is ready.
Using kits can reduce errors. The products have already been gathered, which lowers the risk of picking the wrong item from the shelf.
Prevent Defective Products from Reaching Customers
The kitting process often includes an inspection of all items in a kit. This quality control measure can prevent defective products from reaching customers.
Kit inspection has traditionally been the responsibility of human examiners. Improvements in technology have made automated inspection more accurate. Automated vision systems that incorporate machine learning offer new options for inspection.
Increase Sales and Profits
Kitting can help you increase sales. For example, you can pair an underperforming product with a popular one. You can sell the bundle for more than either product would bring in.
Another strategy is to advertise that buying the kit is cheaper than buying all the items individually. You sell more products and can still make a profit.
Selling items as a kit leads to a higher order amount, which can improve your cash flow.
Kitting helps you use less packaging. This saves money and shows good environmental stewardship. Kits help you deliver an appealing unboxing experience that brings your customers back.
Choose the Right Logistics Partner
Kitting has many benefits for your e-commerce business. You can optimize your warehousing and streamline the fulfillment process. You can improve product quality while increasing sales and profits.
You can design the kitting process that best fits your business. You may want to offer subscription boxes or on-demand packages. You can bundle products under your own brand.
Kitting helps you improve your order fulfillment. The right logistics partner helps ensure that your customers get the best experience throughout the shipping and delivery process.
ACI Logistix is the fastest-growing US provider of small parcel shipping and logistics solutions. We give you a highly reliable and transparent system. We help you build brand loyalty.
Contact ACI today to start developing the right logistics solution for your e-commerce business.
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