Kitting is an inventory management practice wherein individual items commonly used together are packed and shipped together as a single kit. Especially in logistics, bundling related products into one pack lets companies minimize labor costs and increase profits. Particularly, it reduces warehouse expenses, streamlines packing and shipping processes, and makes inventory management more effortless.
Kitting in manufacturing follows the same idea, but the focus is on driving efficiency rather than revenues.
What is Kitting in Manufacturing?
Kitting in manufacturing refers to the process of collecting and organizing components used in manufacturing into a single kit with a new stock-keeping unit (SKU) number. Then, these kits are delivered directly to the point-of-use, which is usually a particular stage in the assembly line.
A kit containing several items, yet bearing a single SKU takes up less shelf space, therefore allowing manufacturers to reduce warehousing equipment. And since the bundle is treated as a single item, they also get to minimize shipping costs.
With these features, kitting is particularly helpful in manufacturing products using multiple components. In addition, it makes inventory management a more straightforward process as you only have one item — the bundle — to focus on.
The bundling technique is also an excellent fit for companies with limited floor space for stocking components. Ultimately, it’s a practical solution for those producing customized products for their end-users. Bundling components make it easier for manufacturers to accommodate the varying parts, features, or preferences required by their customers.
Where Can Kitting Fit in the Manufacturing Process?
What’s unique about kitting is that it can be used at virtually any stage of the manufacturing process. For example, it can happen as soon as the raw materials arrive at the facility or be implemented further down the assembly line, such as in the final stages of assembling complex products.
Examples of Kitting in Manufacturing
As mentioned briefly earlier, there are specific businesses that benefit from integrating kitting into their assembly processes, such as businesses that produce the following products:
- Custom furniture – If you practice high-mix, low-volume manufacturing for producing your furniture, kitting can make it easier for you to ensure that each custom-ordered product uses the right pieces.
- Medical devices – Kitting practices can streamline the process of assembling and delivering different products and medical devices to the end-users — an improvement that can even help save lives in crucial circumstances.
- Automobile manufacturing – Manufacturing automobiles involves an extensive process of assembling various components like the chassis, engine, fuel supply system, transmission system, and so on. As such, kitting helps ensure that the parts are complete and according to quality standards.
Benefits of Kitting in Manufacturing
Now that you have an idea of how kitting can help in various manufacturing processes and industries, let’s look closer at the various advantages it can bring to businesses.
- Increased Production Efficiency
One of the most significant benefits of kitting in manufacturing is that it gives operators easy access to all the components needed in the assembly process. With everything they need in a single kit, they no longer have to walk all over the facility to find and gather individual product parts. Consequently, they can shift their focus, time and energy on accomplishing the actual assembly, increasing efficiency.
- Optimized Storage Space
Storing a single bundle is far easier than stacking away many components separately. It reduces the need for multiple drawers and large storage units to the point that it can free up space. With this, manufacturers can use the newly available room for their workers and assembly equipment, making it possible to design a production line with lesser limitations.
- Faster Manufacturing Rate
Kitting does more than minimize labor costs and maximize storage spaces. For many manufacturers, this inventory management practice is a practical solution for expediting their operations.
Since workers have all the components they need in one kit, they don’t have to make as many stops as they used to throughout the process. In addition, bundling components eliminates redundant touchpoints and makes it easier for them to finish multi-step processes quickly and properly.
- Lower Shipping Costs
Packaging related components together can help manufacturers cut down on shipping costs in different ways.
Internally, it reduces the number of boxes needed to move parts between locations while simultaneously minimizing the hours workers take to transport them. Externally, kitting allows manufacturers to bundle and ferry more items at the same cost.
- Simpler and Better Inventory Management
While inventory management is mainly done using software programs, kitting makes the task easier on the ground.
Assembling individual components involves the lengthy and arduous process of manually locating each piece in the facility. On the other hand, following a uniform method of kitting these elements helps workers not only locate but also understand the inventory better.
In addition, it allows them to quickly determine if they do have enough parts to make a product, preventing issues like defective or insufficient components before they arise.
- Diversified Product Offerings
Kitting enables manufacturers to deliver diverse and customized products to end-users with ease. It gives them the option to either offer the single product with its own SKU or a package of that product along with other supplementary items in a new, single SKU.
- Enhanced Business Profitability
High production expenses naturally take away from a manufacturer’s profit margin. So with kitting boosting the production efficiency, cutting down shipping costs, and improving inventory management, businesses can significantly reduce their production fees. This can ultimately enable them to maximize their profits.
Implement Kitting in Manufacturing with an Experienced Packaging Consultant
Scarce storage space and a lean operations team does not mean you must remain restricted by these limitations. Innovative packaging solutions like kitting can help you maximize your space and streamline your operations so you can continue to meet the specific needs of your customers.
If you need help in revamping your packaging and shipping processes, turn to an innovative end-of-line contract packaging expert like Hughes Enterprises. Whether you need to automate labor-intensive processes, accommodate vendor-managed inventory or something in between, we have the solutions for you.
Contact us today to discover how Hughes’ custom packaging equipment and consumables can help support your needs — and your bottom line.