Posted in Operations and Supply Chain Terms, Total Reads: 400
Kitting is a process in which individual but somehow related items are grouped together, packed and delivered as one single unit. Kitting can help a courier firm increase its delivery speed as it is easier to move less number of packets than moving individual packets.
Kitting can help in following ways.
1. Reduce Inventory- by not storing the finalized products but in form of components
2. Respond quickly and economically to increased or decreased demand
3. Fulfill individual customer orders at a higher pace
4. It helps prevent costs of delivering things separately
It can enhance and optimize the space utilization. Kitting will involve binding together similar kind of products thus decreasing the space required. As more things can be kept in same space and more goods can be transported it allows company to take more orders or use less vehicles for same number of orders thus decreasing the overall cost.
Example- An assembled PC - Customer might have chosen keyboard, mouse, CPU Cabinet, Hard Disk, processor, Monitor from range of options. But supplier binds together all devices and delivers it as one single unit to customer.