In our new blog series, Inventory Management Features, the first post will take a look at: Kitting. We will talk about what it is, some benefits, and finally the use of this feature in an inventory management system.
Kitting is the process of grouping, packaging, and shipping various items together in order to offer them as one unit. Let’s say you want to ship items A, B, and C to a customer. So instead of sending them separately, bundle the items as a kit and ship it altogether. To get the most benefit, kitting is commonly used for products that are different but related, and have the ability to be sold collectively.
Here’s a simple example for better understanding.
Imagine that you sell digital cameras and accessories. Over time, you observe that mostly clients either buy a camera + memory card or camera + batteries + tripod at once . In terms of kitting, there’s a few ways to go about it: you can ship the items together in a kit, assembled to order. Or you may offer them as bundles and pre-assemble the kits before selling. Regardless, kitting is more efficient than shipping items individually.
Kitting is a commonly used practice because of the benefits it provides:
- Inventory benefits: From an inventory point of view, kitting can help you track your items better. When you group them, you can consider and manage all of it as one SKU as compared to multiple individual items.
- Financial benefits: Pre-kitting items means your workers spend less time in picking and packing, reducing labor costs. In addition, your cash flow improves because you have a better control over your inventory and don’t overstock/ understock.
- Operational benefits: If you kit products, you take less time in processing and handling parts, respond and fulfill orders quicker. No doubt, your productivity improves as you have set processes in place.
Kitting in an IMS
An ideal Inventory Management System (IMS) should let you:
- Track stock levels for the components of each kit in real time
- Automate purchasing orders and alerts for low levels
- Update the stock levels to your online stores including the individual items, if displayed
- Print packing lists that include relevant information for the skus, including location
With Clear Spider’s IM solution, you can perform all the aforementioned tasks. Meaning, kit products easily, allot them a specific part number and track them as one SKU. In fact, you may manage them as a collection of parts instead of one single item, depending on the use case.
However, note that if you wish to track kits on multiple levels, that may deviate into more of a manufacturing software’s function.