You may be familiar with the concept of kitting in eCommerce, but have you ever wondered how it applies to the manufacturing process? In the world of manufacturing, kitting plays a crucial role in optimizing inventory, material usage, and overall operational effectiveness. In this article, we will explore the significance of kitting in manufacturing and its benefits for both manufacturers and customers.
Understanding the Manufacturing Kitting Process
In manufacturing, kitting involves bundling products, materials, or components together to create a single, unified package. Unlike eCommerce kitting, which aims to increase sales or order values, manufacturing kitting is typically driven by customer requests or patterns observed in frequently ordered goods.
Manufacturing kitting, often referred to as “material kitting,” can occur after the production process is complete. Manufacturers gather the products they have produced and combine them into a single item. This streamlines the assembly process and improves efficiency. Additionally, manufacturers may internally kit components of a finished product to facilitate production line operations. This approach allows workers or robotics to easily access the necessary materials without searching for individual items.
To illustrate this concept, think of purchasing a Murphy bed from Lori Wall Beds. The screws and bolts required for assembly come conveniently packaged in a labeled kit, ensuring a smooth and efficient assembly process.
The Role of Kitting Process Software
Implementing kitting in manufacturing has a significant impact on inventory management. When items are combined into kits, multiple SKUs are transformed into a new SKU. This requires accurate and real-time tracking of inventory counts for each produced item.
Using kitting process software simplifies this task by automatically updating inventory counts as units are produced. Whether it’s material kitting in manufacturing or eCommerce kitting, this software eliminates the need for manual data entry, streamlining the kitting and manufacturing processes.
The Flexibility of Kitting in the Manufacturing Process
One of the unique aspects of material kitting in manufacturing is its versatility. Manufacturers can incorporate kitting at various stages of the production process. They may choose to kit materials as soon as they are delivered to the manufacturing facility or combine them with other components further down the assembly line. This flexibility allows manufacturers to support different production options, optimize processes, and reduce labor and parts usage. Internal kits are often packaged for immediate use, minimizing the cost of moving kits around the production floor.
Workers at the point of kit usage are familiar with the contents of each bundle. This consistency enhances production line efficiency and facilitates quality control measures.
This approach differs from eCommerce kitting, where product kits are typically created at the end of the packaging process. In eCommerce, goods are combined in standard or custom packaging, highlighting the benefits of the kit, such as reduced costs, added value, comprehensive product experience, and more.
In some cases, the point of kit usage in eCommerce is handled by third-party logistics providers (3PLs) like Red Stag Fulfillment, who integrate kitting as close to the pick and pack process as possible. This allows businesses to focus on inbound logistics for fewer SKUs. By sending inventory to a 3PL, kits can be created based on projected or actual order volumes. This dynamic approach enhances operational efficiency and reduces preparation work for freight shipments.
The Top Benefits of Kitting in Manufacturing
The benefits of kitting extend to both manufacturers and customers, covering material and product kits. These benefits can be seen directly, such as reduced warehouse space needs, or indirectly through improved operational efficiency and cost savings.
1. Lower warehouse storage space needs
Kitting simplifies storage by consolidating multiple components into a single package. Workers can access a packaged kit, utilize its contents, and send the finished product down the assembly chain. Bulk kit production enables optimal use of storage shelves and reduces costs associated with storing individual components.
2. Increased production space
By utilizing kits, manufacturers free up space that would have been used for inventory storage. This additional space allows for more efficient assembly processes and provides room for expansion, leading to improved cost control and enhanced equipment utilization.
3. Streamlined manufacturing processes
Kitting plays a crucial role in optimizing manufacturing operations. By reducing touchpoints and eliminating unnecessary stops, kitting enables faster production cycles and higher throughput. Bundling components simplifies multi-step tasks, allowing workers to complete them more efficiently.
4. Minimized shipping costs
Kitting contributes to cost savings in shipping. Internally, combining items reduces the number of boxes moved between locations, thereby reducing labor costs and equipment wear. Externally, manufacturers can pack more products into less-than-truckload (LTL) or full-truckload (FTL) shipments, maximizing shipping efficiency and lowering transportation costs.
Red Stag Fulfillment offers support in calculating these shipping cost savings through their DIM weight calculator.
5. Simplified inventory control
The use of kits enhances inventory control by promoting uniform storage and facilitating accurate inventory counts. Combined with inventory management software, kits streamline warehouse operations, reducing the risk of backorders and stockouts.
6. Enhanced product diversity
Kitting enables manufacturers to offer a wider range of products and components. By combining individual SKUs into new SKUs, manufacturers can provide comprehensive packages that include all the necessary components for a complete product experience. This flexibility also opens up opportunities for expanding into related categories based on customer preferences.
This flexibility is particularly beneficial for businesses utilizing dropshipping models.
7. Increased customer satisfaction
Efficient kitting processes lead to improved customer satisfaction. By partnering with manufacturers or 3PLs that prioritize kitting components that contribute to sales, businesses can enhance the overall customer experience. Happier customers are more likely to become repeat shoppers, driving long-term sales growth. Analyzing customer habits through sales software can uncover opportunities for subscription-based kitting services, further boosting sales.
Embrace the Power of Kitting in Manufacturing
The advantages of kitting in the manufacturing process are substantial. Manufacturers can benefit from treating different sections of their production line as individual “customers,” delivering kits and reducing costs. This internal use of kitting simplifies logistics and presents a cost-effective solution. As manufacturers become proficient in utilizing kitting, they can offer various solutions to businesses, creating opportunities for unique partnerships and expanded sales.
Red Stag Fulfillment plays a pivotal role in the final assembly process for many companies. Their warehouse experts specialize in combining the right goods into branded kits, enhancing the customer experience. By incorporating kitting into the fulfillment process, businesses gain greater flexibility to adapt to current customer demands.
To explore how kitting can elevate the quality of your business and its offerings, reach out to the Red Stag team today. Embrace the power of kitting in manufacturing and unlock greater efficiency and cost savings for your operations.