Original equipment manufacturers (OEMs), remanufacturers, retailers and wholesalers establish warehouse kitting procedures to make ordering easier for their distribution network. By packaging separate-but-related items together under one part number, organizations save both time and money.
Often these kitting services are outsourced to warehousing and supply chain experts instead of performed in-house. In-house kitting requires initial capital investment, employee training and procedural learning curves that increase line stoppages and the number of damaged or inaccurate shipments. On the other hand, partnering with a kitting warehouse that has a trained and experienced team of professionals not only keeps inventory costs down and warehouse space free, it also ensures that the job is done accurately and efficiently.
The Outsourced Kitting Process in a Nutshell
Within the broader context of production, kitting is an important step in the journey from manufacturer to endpoint delivery. Manufacturers hire third-party logistics (3PL) providers to store their parts and pieces to save warehouse space. When orders are received, the 3PL associates take the parts from storage and arrange them into predetermined kits.
If the kits are meant to be assembled, that process can be performed by an assembly team in the next stage of delivery or even by a 3PL that offers assembly and subassembly services. In that scenario, 3PL team members package the kit for delivery to retailers, wholesalers or end customers, or even back to the manufacturer. Overall, outsourced kitting is an efficient way to serve the end customer by providing them with equipment, planned maintenance parts and replacement parts.
Warehouse Kitting Procedures
Kitting in a warehouse can be a rather involved process that requires dedicated kitting experts and processes. That said, it’s easy to understand why manufacturers outsource the kitting process to save time and money. Superior kitting procedures involve the following:
- Custom kitting design and planning
- Consignment and procurement
- Total supply chain management
- Support of just-in-time operations
- Operational flexibility
- Capacity to handle a wide range of kits
- Total technology integration
- Full EDI capabilities
- Barcoding
- Labeling to spec
Entrust the Kitting Process to the Experts
Time and efficiency improvements are maximized through 3PL kitting services that help organizations manage other key aspects of the production process such as warehousing, packaging, assembly, distribution, JIT delivery and supply chain management. Since services like kitting and assembly are closely linked, it’s important to consolidate the two, as well as any other value-added services, to maximize value and efficiency.
At NewStream Enterprises, LLC, we have the capacity and experience to design a kitting process that takes into consideration the whole production life cycle. This means our partners get a more complete and integrated solution that saves time, is more cost-effective and allows them to focus on growth.