Maximizing the usage of product kits
To create more attractive merchandise for customers, many merchants wind up selling products as kits. By grouping multiple products – and variants of those items – into kits, retailers are better able to sell certain items while also reducing costs in the order fulfillment and shipping processes. However, from a warehouse management perspective, managing kits is much more complex. Merchants have numerous options in that regard.
1. Virtual kits
Virtual kits refer to kits that customers can order and are then assembled by distribution center employees after receiving such purchases. This gives the retailer more flexibility in terms of allowing customers to make product substitutions or select different variants.
For instance, a retailer trying to get rid of winter clothing could create a kit of jackets, scarves and mittens. With virtual kits, customers could choose different colors or opt to trade the mittens out for the hat and be charged the difference. Kits can contain numerous different configurations, giving the customer more options before making his or her purchase.
Made-to-order kits are easily assembled in the warehouse, with the packaging list showing the final kit but warehouse employees being given the option to pick and process each item separately. While this may be be a bit slower to fulfill than pre-assembled kits, merchants can reduce pick time by locating kit items in close proximity with each other.
2. Pre-assembled kits
Pre-assembled kits offer customers less flexibility in order to improve order fulfillment time by a significant margin. When customers order pre-assembled kits, they will have been made already and will be sitting on the shelf. Inventory is counted toward the master product – the kit in this instance – instead of as individual pieces. Warehouse employees can simply take the kit and package it, and they will often even know which type of packaging or box is optimal for the order.
This is perfect for high-volume time periods, such as the holidays or back-to-school season, and allows retailers to quickly process orders even during busy peaks. A common example of kits are starter or variety packs of specific items, such as cigars, that retailers know customers will buy together.
Kits and bundles are effective ways of moving popular products, and merchandisers should always be on the lookout for different ways of using kits to improve their operational efficiency.