Ecommerce order fulfillment can be complex and time-consuming. You have to juggle numerous orders from different customers and ensure that each order’s products are picked, packed, and delivered correctly. All this while also trying to make the fulfillment process as efficient as possible.
But what if there was a way to make the process more seamless and less stressful? That’s where kits and bundles come into play. Kits and bundles are combinations of products you sell as a single item.
It’s a clever way to change the value proposition of your product without making any changes to it or offering discounts that could harm your bottom line. While kitting has its fair share of benefits, it also poses some challenges. The most common one is tracking inventory and stock levels for each kit, as it can be difficult to keep up with the components that make up the final product.
This article delves more into kitting, its benefits, challenges, and how the right software, like SKULabs, can streamline the process.
What is product kitting?
Product kitting is a process in which separate but related items are grouped, packaged, and sold together as an individual item. This technique allows you to bundle multiple products into one SKU (stock-keeping unit) for sale or shipping purposes. A product kit can contain variations of a single product or complementary items that customers often purchase together.
Kitting streamlines the order fulfillment process by creating a single scannable SKU to represent multiple items.
When you have a software solution that has a native kit functionality, you minimize the number of items that need to be scanned for each order, thereby reducing labor costs, and time spent picking and packing orders. There are two types of kitting, just-in-time kitting, and pre-configured kits
The difference between just-in-time kitting and pre-configured kits:
The two concepts sound similar in that they both involve packaging multiple items together and selling them as a single unit. However, there’s a difference in the way inventory is handled for each type of combination.
Pre-configured kits require a lot of overhead and prep work. This is the old strategy of selling bundles online. Items must first be picked out of inventory, manually deducted, bundled together and given their own SKU, inventory count, and their own location in the warehouse. This method will need to be repeated each time a kit goes up for sale. Not only is this inefficient, it creates problems when you need to sell single items separately, and can cause confusion when doing inventory counts.
On the other hand, a JIT kit has a distinct SKU separate from the inventory of the individual items that make up the kit. Inventory is tracked for each component item as well as the kit itself. While this used to be a logistical nightmare in the past, today’s modern software solutions can do all of this for you in the background while you can focus on more important aspects of your business!
Benefits of product kitting
Now let’s explore the benefits of using kits and bundles in inventory management. Here are some of the most notable ones:
Improved Convenience for Customers
Bundling products together makes it more convenient for customers to purchase related items at once. When you put complementary items in a kit, customers don’t have to browse multiple product pages and add each item to their shopping cart. For instance, if a customer needs to buy body wash, shampoo, and laundry detergent, you can bundle them into one kit and make their purchase experience much easier.
Product kits are a great way to boost sales, as they offer customers more value. When selling on third-party marketplaces like Etsy, product kitting ensures you have more offerings for your customers since you can list the individual products and the kits. More listings increase the likelihood of appearing higher in search results, thus leading to more sales.
Minimal excess stock
Kitting allows you to pair inventory that doesn’t move quickly with inventory that does. This way, you can move inventory that would otherwise take longer to sell if it were listed as separate products. Furthermore, kitting creates a better value proposition for your slow-moving inventory, reducing the chances of having excess inventory.
Reduced packaging and shipping costs
Product kitting reduces packaging and shipping costs by eliminating the need for multiple packages and shipments. By bundling products together, you can save money on materials like boxes and labor costs associated with packing and shipping multiple items. Consolidating products into one shipment reduces the time spent in transit and can lead to lower shipping rates from carriers.
The challenges of dealing with product kits
Despite the benefits of product kitting, inventory management is more complicated with kits and bundles than with individual items. When selling on multiple channels, such as Amazon and Shopify, it can be difficult to keep track of inventory levels across all platforms. If inventory doesn’t sync across all marketplaces, you can oversell a product or bundle that is no longer in stock.
Without a native inventory management solution for kits and bundles, it can be difficult to know how much inventory you have available to advertise for sale. Furthermore, when a customer purchases a kit or bundle, you should deduct inventory from all the individual items that make up the product.
If you don’t have a solution that makes the deduction seamless, you must manually deduct inventory levels for each item. This can lead to discrepancies and inaccurate inventory counts, resulting in overselling or underselling. .
Finding a quality solution for your JIT kits
The best way to make inventory management simpler for kits is to use a solution with features specifically designed for JIT inventory control. A solution like SKULabs can help you manage multi-channel inventory for kits.
SKULabs will assign a single SKU to your kit to make it easy to track inventory, and push the correct stock to your channels for both the individual items(if sold individually), and the kit.
The kits can comprise multiple quantities of the same inventory item, or various quantities of additional component items. SKULabs considers the stock for all your inventory components and calculates how many kits you can advertise for sale across all of your sales channels.
A single barcode scan will then automatically deduct all items in the kit from the inventory count. With such a solution, it’s easier to maintain inventory accuracy, picking efficiency, and your customers are able to buy kits without worrying about inventory discrepancies.
Manage your inventory better with SKULabs
Product kitting is a great inventory management technique as it reduces inventory levels, cuts packaging and shipping costs, and provides customers with a better value proposition. However, kit inventory management can be complex without the right software.
That’s why you need solutions like SKULabs to simplify inventory tracking and keep inventory accurate across all channels. Learn more about how SKULabs can supercharge your ecommerce inventory management and get started on your inventory control journey today!