Convenience continues to reign supreme in the minds of consumers. With a growing number of businesses shifting focus towards online experience and swift order fulfillment, 83% of shoppers report that convenience is more important to them now versus five years ago. With both consumers and businesses looking to save time and money, total online product sales in the United States spiked 44% in 2020. A not so niche area now is the subscription service, which is estimated to be $1.5 trillion by 2025 according to UBS financial services.
A popular warehouse and shipping technique used by manufacturers and online stores, kitting is the process of packaging and shipping individual products together as a bundle. These goods are related and packaged as a single SKU, offering increased convenience to purchasers and businesses alike. While beneficial for online stores, automated kitting can also be used to streamline traditional manufacturing operations, as well. However, manual kitting often wastes space, time, and labor while automated kitting offers a high-density solution for swift order fulfillment.
Direct-to-consumer beauty subscription boxes require kitting, often combining various brands and products into a single package. During the pandemic, interest in these subscriptions spiked as stay-at-home orders increased screen time, encouraging consumers to purchase items online. In a survey of over 4,500 Influenster users regarding social media use during the pandemic, 82% of respondents reported that social media provides them with the most information about brands and products.
When TikTok and Instagram’s user count soared in 2020, many cosmetics subscription box companies turned to influencers for promotion. For example, Benefit launched a program allowing influencers to sample products from attractively packaged kits to feature in “unboxing” videos. By capitalizing on increased screen time through social media and influencer marketing, the six largest players in the cosmetics subscription market - Allure, Ipsy, FabFitFun, GlossyBox, Birchbox and BoxyCharm - reported a 400% increase in total sales in 2020. And although pandemic restrictions are lifting, many consumers are choosing to keep their subscriptions.
Due to sustained sales, cosmetics fulfillment operations face pressure to deliver boxes accurately and efficiently. By automating the kitting process, these companies streamline shipping, lower packaging fees, and save on labor costs – even during unexpected order surges. The automated product kitting process involves receiving orders, storing them appropriately, then having the system pull the necessary totes for picking the correct products, and assembling them into boxes ready to ship. Technology used varies based on operation, but many automated kitting systems employ automated storage and retrieval systems (ASRS) alongside warehouse management systems (WMS) for full inventory visibility and error-free picking.
The process can be broken down into several steps. First, individual products are stored in bins, totes, or trays. If a warehouse management system (WMS) is implemented, products in the same kit are automatically stored close by and retrieved with ASRS technology. Depending on the requirements of an operation, robotic retrieval can be executed by storage shuttles, vertical lift modules (VLM), or carousels. When ready for assembly, the WMS provides the information to the system and the proper totes are brought to a goods-to-person workstation where the kits are assembled. After kit assembly, the packages can either be re-stored for shipping later or shipped out immediately.
Kitting has many benefits that translate across multiple industries, including the apparel and food & beverage industries. Although the cosmetics industry commonly uses kitting for subscription boxes, the process can also be used to simplify packaging and shipping for orders with multiple products. Instead of shipping several boxes, kitting allows businesses to gather products together in a single package.
Adopting automated kitting is a smart decision for e-commerce businesses looking to minimize labor costs, increase customer satisfaction, and handle unexpected order volume. Other benefits include:
Error-free Picking. Leveraging an automated solution lowers error rates making kitting virtually error-free, which saves money on returns.
Increased warehouse space. The addition of an ASRS solution allows for dense storage space. As business grows, more products can easily be housed within the same area.
Greater throughput. When products are combined or strategically stored within a specific location, items are pulled faster. This saves businesses valuable time during retrieval, picking, and shipping. Additionally, customers receive their products sooner, increasing satisfaction and the likelihood of repeat business.
Learn how automation technology from SSI SCHAEFER can help your business reduce costs, save on labor, and increase efficiency. Contact us by calling 704-944-4500 or filling out a contact request form today.