The customer experience is everything in ecommerce. Naturally, competitors are always looking for new ways to differentiate themselves from the noise by providing exceptional experiences that delight customers and bring them back for more.
Kitting is one area where ecommerce brands can get creative to see big rewards in customer loyalty. Though it is a small aspect of the order fulfillment process, mastering the kitting process can greatly enhance your presentation, customer satisfaction, operations, and retention.
In this guide, we’ll break down what kitting and the kitting process are, some of the benefits of kitting, and how ShipBob can help you implement kitting while streamlining your ecommerce fulfillment.
What is kitting?
In the broadest sense, kitting refers to the process of preparing inventory so it’s ready to be fulfilled and sent to customers.
Some preparations may be small. For instance, kitting can refer to the simple action of unwrapping each SKU from the manufacturer’s packaging, inspecting it for damage, or sticking a label on it. Actions like these help get the inventory unit into its final, pickable form, and would count as kitting.
Other preparations may be bigger, and affect the whole fulfillment process. Most often, “kitting” refers to the process of gathering several different products and packing them together ahead of time so that they can be sold as a single SKU, or “kit.”
Kits commonly come in custom boxes or need items to be packed in a certain order, so preparing kits by picking the necessary items, constructing those custom boxes, and arranging each item inside would also qualify as kitting.
What is the difference between kitting and assembly?
While used interchangeably, kitting and assembly are not necessarily the same thing. Assembly involves making changes to a product itself (e.g, helping build it from scratch – think an IKEA furniture piece set), where kitting typically involves making changes or final touches to a product that is already fully packaged (e.g., putting it with other products in a box or adding a sticker to it).
What is the difference between kitting and bundling?
Bundling and kitting also get confused or used synonymously. This makes sense, as both can refer to grouping and selling multiple products under a single SKU.
The difference between them lies in the fulfillment method. Bundles are usually picked one item at a time, after an order is placed. Kitting, on the other hand, involves pre-collecting each group of items as a kit (usually decoratively in a single box) proactively and in bulk, before orders are placed. Once orders for the listing come in, each kit is simply picked for the order.
Let’s walk through a couple examples to go through the differences:
Bundling (the simpler option)
A haircare brand sells a Starter Bundle that includes 1 shampoo, 1 conditioner, 1 leave-in conditioner, and 1 glossing spray. Customers can buy this collection as a single offering, rather than purchase each and every SKU on its own.
Kitting (the more customized option)
A skincare kit or bundle comes with a cleanser, a toner, a serum, a moisturizer, and a facial oil, which must all be used one after the other in a single skincare routine. This skincare brand only wants to sell the products together, and package everything in a box that fits all 5 products perfectly.
Unlike product bundling, items in a product kit usually aren’t available to purchase separately, and are often exclusive to the kit. When it comes to fulfillment, the kit was already pre-built, so only 1 SKU has to be picked when the order is placed.
“With ShipBob, we were able to mark any combination of SKUs as a unique bundle and select the component SKUs right through the dashboard. Each time that bundle was fulfilled by ShipBob, we could see the individual components that were physically picked, and we would know that the order went out as expected.
ShipBob also allowed us to make changes to bundles on the fly with complete control and visibility, which is important in monthly subscription boxes, holiday bundles, and many more scenarios.”
Gerard Ecker, Founder & CEO of Ocean & Co.
Why is kitting important?
Kitting enables an ecommerce business to create a tailored, delightful unboxing experience for the customer without bottleneck operational efficiency.
Pre-assembling kits means warehouse staff won’t have to spend too much time picking or assembling multiple items for the order when the order is placed. This facilitates faster turnarounds, which in turn help to speed up fulfillment and delivery.
As a result, the customer receives a complete kit, a better unboxing experience, and quick delivery — all of which come together to improve the customer experience.
The benefits of kitting
When you leverage kitting services that a 3PL like ShipBob offers, you get to enjoy a wide range of benefits. Here are just some of the major benefits of kitting services.
Kitting involves putting together multiple products into a single box or container, which means that the kit is stored in one location. It’s much easier and far more efficient to store, locate, and pick a kit from one location, instead of all over your warehouse.
In this way, kitting saves warehouse space and picking time, while making it simpler to monitor the movement of inventory through the fulfillment process.
Easily identifiable manufacturing mistakes
Did your supplier forget to add a sticker or bag to individual products? Kitting performed at a fulfillment center may save the day, as some kitting process’ built-in inspections prevent manufacturer mistakes from slipping through to customers.
Streamlined picking and faster fulfillment
When fulfilling orders for a kit, warehouse staff will only have to pick one item (i.e., the kit) instead of picking multiple items from different parts of the warehouse. This helps streamline fulfillment operations — and, since the products are already gathered together beforehand, kitting also minimizes the risk of picking the wrong item from the shelves, improving your accuracy rate.
If everything goes smoothly, saving time on fulfillment also enables a business to shorten shipping times. Kitting allows more orders to be shipped sooner, with less time spent on order prep after the order is placed.
Additionally, some kits may not even need additional packaging (just a label). This significantly speeds up the shipping process, allowing customers to receive their orders quickly.
“It’s challenging to attribute our growth to just one aspect of the business, but our overall traffic, volume of orders, and conversion rate have steadily increased. Without a doubt, a portion of that is due to increased shipping speeds we’re able to offer because of ShipBob — the average time to fulfill and the average time to send orders out has decreased from our last provider.
With our last 3PL, if our customers wanted free shipping, they had to have economy shipping and wait 5-8 days for delivery. Whereas with ShipBob, we can offer free shipping and customers receive their order in 3-5 days. I believe part of our increased conversion rate is due to our customers seeing the option for faster shipping at checkout. ShipBob’s 2-Day Express ship option definitely helps this.”
Peter Liu, Co-Founder of RIFRUF
Like bundles, kits can boost your AOV by combining multiple items in a single order, which customers may feel enticed to buy due to a better perceived value or added convenience. Similarly, kitting may help you increase sales, as it lets you curate your products into groups that customers may be more likely to buy. Kitting also makes it easier to deliver a delightful unboxing experience that keeps customers coming back, and deliver it wherever you sell.
How does the kitting process work?
The kitting process can look different for every business, depending on the project. Some kitting projects may just involve adding a sticker to every unit of a single SKU, while others may require removing packaging, constructing boxes, positioning items, and more.
However, for many ecommerce businesses, the process of building a kit follows the same basic steps.
Step 1: Determine what will be included in the kit
First, you must decide what items to include in the kit. You may choose to put multiple complementary products together based on theme, use, similarity, or for other reasons.
Let’s say a candle company wants to create make-your-own-candle kits that customers can buy. These kits would need to include everything customers would need to make their own candle: wax, fragrances, coloring, wicks, and more. Thus, each kit would need to include all of those items.
Step 2: Create a new SKU
Once you’ve decided what goes into your kit, it’s time to assign a unique SKU to that kit. This makes the kit a single sellable product. You will also need to enter the SKU into your inventory system, so you can accurately record sales trends and inventory counts, as you would for any single-item SKU.
Step 3: Assemble the kit
The most time-consuming step is putting the kit together. This involves gathering all the components of the kit, preparing each component so that it’s in its final intended form, and placing them into a designated container or box.
For example, the candle company from Step 1 would gather all the items that go into a kit (the wax, fragrances, coloring, wicks, etc.). To make sure nothing is damaged in transit, the kitter wraps each component in special branded tissue paper, seals the tissue paper with a branded sticker, and arranges all the components in a special heat-resistant and decorative box. Once that’s done, the kit is finished and ready to be sent to a customer.
Step 4: List the kit for sale
Once you have the kits ready, it’s time to create a new product listing for it. As orders come in for that listing, the pre-assembled kit will be picked from its bin, shelf, or pallet location and sent to the packing station, where it will be affixed with a shipping label to be ready for shipping.
The different types of kitting
Kitting doesn’t always take place in the same supply chain phase, either. Different businesses may arrange for kitting to happen before the manufacturer ships the goods to the merchant, during regular fulfillment, or even for different types of fulfillment. Here’s a breakdown of some common types of kitting throughout the supply chain.
This is the most popular type of kitting, in which pre-built kits are assembled in a warehouse during the regular fulfillment process. Within a warehouse, kitting may take place at a dedicated kitting station, or at packing stations as customer orders are fulfilled, depending on the type of kitting project required.
Manufacturing kitting is any kitting activities that happen at the manufacturer, before the finished inventory is sent to the merchant. There are two types of manufacturing kitting: material kitting, and internal kitting.
Material kitting is very similar to warehouse kitting — except in this case, the manufacturer would group different pieces of finished inventory into a single package to send to the merchant (as opposed to the merchant sending the kit to a customer).
Internal kitting, on the other hand, is kitting that helps a manufacturer produce the inventory it sends to merchants. For instance, in an assembly line model, Manufacturing Worker A could put various raw materials and components into a kit to speed up product assembly. Each kit will contain items that are necessary to build a specific product, so that later on, Manufacturing Worker B won’t have to manually hunt down each and every item they need separately.
Subscription boxes contain a curated selection of (usually) complementary products, and are designed to be shipped out to designated customers on a recurring basis.
They typically go out weekly, monthly, or quarterly, depending on how often the products might be needed, or what kind of subscription plan the customer opts for. At the start of each new period, the merchant puts together a unique set of items that are either new to the customer or intended to replenish their existing supply.
Subscription orders generally call for kitting, as they contain multiple items, do not typically vary from customer to customer, and recur regularly. Kitting these orders in advance saves time and a lot of effort for your team.
“When we were launching our diabetes subscription service, we knew we needed a fulfillment partner who offered a tight Shopify Plus integration. Unlike most 3PLs that lack sophisticated, intuitive tools, ShipBob’s technology is modern. Their software even makes it easy to bundle products made up of multiple SKUs from our inventory, so it is packaged exactly as the customer ordered it.”
Doug Kern, VP, Ecommerce of One Drop
ShipBob fulfills One Drop’s Class 1 medical devices.
On-demand kitting is really just a fancy way of saying “build your own bundle”. With on-demand kitting capabilities, you can give customers the freedom to build their own kits virtually.
In these cases, the merchant isn’t the one deciding what goes into the kit (or package). The products may exist as standalone items with separate SKUs, and customers can choose which items go into the kit based on their unique needs and pain points. These personalized kits are then assembled as soon as the customer places the order.
How to manage the kitting process
Kitting may be different for every business, but one thing is certain: it can get complicated, especially when managed manually.
While kitting comes with plenty of benefits, it also poses a few challenges when it comes to inventory management. Since you’ll be creating new SKUs and using existing inventory to do so, it’s crucial to ensure that your inventory counts are always updated to reflect that. Tracking inventory movement, SKU creation, and kitting requirements can be a headache, especially if you’re using outdated systems with little functionality.
To keep kitting as simple as possible, many ecommerce merchants rely on a 3PL partner to handle kitting. Working with a 3PL that leverages robust inventory management software (in which unit counts are automatically updated after sales activities and inventory changes!) saves you effort, and minimizes the risk of human error. Plus, you never have to kit or even fulfill orders yourself!
ShipBob offers kitting (and much more)!
As a global omnifulfillment platform, ShipBob offers the kitting services you need to perfect your orders — and so much more besides.
ShipBob’s comprehensive fulfillment services for ecommerce businesses include product kitting services, which simplify the process of building product kits to help you expand your catalog with ease.
First, decide the items you want to include in the kit, and the number of kits you want to create. From there, simply place a kitting request through your ShipBob dashboard, and we’ll handle the rest.
If you don’t want to create kits, ShipBob also supports a number of helpful kitting actions, depending on your unique needs. This may include constructing your box/packaging, placing an item inside the box, affixing a sticker, changing an item SKU to a kit SKU, and many more.
Beyond kitting, ShipBob will handle regular order fulfillment for all your DTC and B2B channels. Whether orders come in for your kits or other SKUs, ShipBob will instantly begin processing, picking, and packing them before sending them out for shipping.
Ultimately, outsourcing fulfillment to a trusted partner like ShipBob not only saves you time, but also lets you rest easy knowing you can optimize and streamline your fulfillment for peak performance with less effort.
Below are answers to some of the most common questions about kitting.
What is kitting in ecommerce?
In ecommerce, kitting is the process of combining individual components or SKUs to create a single, finished item or order that’s ready to be sent to a customer.
Kitting can prepare inventory items for fulfillment (such as wrapping an item in tissue paper or affixing a sticker to it), or gather several items together and pack them as a single SKU ahead of fulfillment.
What is the difference between kitting and assembly?
Kitting is the process of making changes or final touches to a product that is already fully packaged, or putting together multiple items and combining them into a single offering. Assembly involves making changes to a product itself or helping build it.
Where does kitting fit into the supply chain?
Kitting can occur in many different stages of the supply chain, including in manufacturing and warehousing. In ecommerce, kitting most often occurs during fulfillment, particularly when fulfilling subscription or “build your own bundle” orders.
Does ShipBob offer kitting?
Yes! ShipBob offers a variety of product kitting and assembly services for an additional fee.