Ask yourself, how busy are you and how busy is your internal fulfillment center? I am certain that the answer will be, extremely busy with normal day-to-day fulfillment activities. That is not a surprise since the need for third-party services worldwide is climbing at a significant rate.
According to Mordor Intelligence, “The global contract packaging market was valued at USD 49.89 billion in 2020, and it is expected to reach USD 89.74 billion by 2026, registering a CAGR of approximately 10.18% during the forecast period (2021-2026).”
Continuing, “With the outbreak of the COVID-19 pandemic, the contract packaging market has witnessed tremendous growth, as the e-commerce market has taken a boom, owing to lockdown and social distancing norms where the majority of the consumers have been preferring online channels for shopping, and companies have been outsourcing their packaging end to end or standalone services to meet the growing demand.” The contract packaging sector in North America is also rapidly growing due to the increasing demand. Businesses like yours are discovering cost savings in outsourcing kitting and packaging to a third-party fulfillment center eliminating internal costs for equipment, facility space, and manpower.
Kitting is the process of taking multiple SKUs and combining them in a package to create one new SKU using a system that accurately manages inventory, as products go from units to kits.
Packaging is the process of preparing the final “kit” SKU for shipment. Both kitting and packaging are part of the overall fulfillment process. Under normal conditions, you may be able to handle your fulfillment process in-house but how do you survive that marketing sampling initiative or that employee appreciation package assembly on top of everything else?
Most of these campaigns have a tight deadline associated with them. Accuracy and timing are critical. These types of programs can quickly bury your standard operating procedures. Do you have the physical space to handle these additional projects and where will you find additional manpower? That is where a third-party fulfillment center can relieve you of the conflict. Even if you do not contract with a third-party fulfillment service to handle all of your fulfillment, you can contract with an outsource group to handle your special project. This allows you to hit your deadlines with accuracy and at a reasonable cost without disrupting your normal operation. Once tried, you will never go back.
Some of the critical aspects of kitting and packaging are security, accuracy, and timely turnaround. Many businesses have come to recognize the advantages of outsourcing these endeavors to a reliable and clean fulfillment center, professional manpower training, automated processes, accuracy, and security. Outsourcing frees up space and headcount within your facility to be used for more productive, specialized activities.
It doesn’t always make sense to kit items, but when it does, there are a variety of benefits and cost savings that can come from many areas. Here are some ideas about what can be kitted:
- Product Samples
- Promotional Items
- Instructional Packets
- New Product Launches
There are many more ways to use third-party/outsourced businesses, but this list can get you thinking about ways it might work for your business.
A centrally located fulfillment center can economically and efficiently provide the following advantages for your kitting and packaging needs:
- Warehousing – in a clean, dry, humidity-controlled environment to protect your items
- Staging – adequate room and organization to gather all SKUs that will be kitted
- Trained Professionals – experienced in all aspects of kitting and packaging with adequate cross-training to seamlessly maintain fulfillment processes
- Automated Systems and Processes – to ensure accuracy and efficient workflow
- Manage Order Surges – when you need more people on the job to meet order demand, a professional fulfillment center has the manpower to satisfy order surges
- Security – protection of your materials as well as protection of your data are priorities of a professional fulfillment center.
When it comes to order fulfillment, businesses are always looking for new ways to improve speed and cut costs. Kitting and staging of items required to complete a task is an effective way to reduce time and minimize costs. This activity ensures that the performance of the task is not delayed while waiting or preparing items that are critical to the completion of the task. While this may seem a minimal issue, the staging of items for kitting can result in success or failure of your project or ongoing activity. Staging can wreak havoc with your operation due to space limitations, the organization of individual items received at various times, and the manpower needed to organize and stage elements of the kit. If the staging is not handled effectively, there is no way that the kitting and packaging can be accurate. That is where a third-party fulfillment center can be a huge benefit to your business as well as your job.
Finally, let’s talk about tracking and billing automation for staging and kitting. Using third-party fulfillment centers you will find the latest automated programs and processes that can ensure the accuracy and security of your materials. In addition, these systems verify the kits prepared and shipped along with the timing and the expense. This data enhances the accuracy of your invoices so that you can appropriately track the costs of each project. This makes reporting easy and accurate.
Think Patented operates a complete fulfillment center at its facility in Miamisburg, centrally located in southwest Ohio. Services include warehousing, fulfillment, kit packing, print-on-demand services, and third-party logistics – under one roof and one workflow. The newest facility is located next to the company’s headquarters in Miamisburg, an ideal, nationally recognized geographic center for distribution with optimal ground and air access. The facility is a high-bay, narrow-aisle, 100% climate and humidity-controlled structure, and incorporates the latest technology for accuracy and efficiency. The new fulfillment center provides ample opportunity to accept more clients seeking cost-effective outsourced fulfillment services. No kitting and packaging account is too large or too small. You can reduce your costs and turnaround time, increase your efficiency, security, and accuracy.
For more information, contact your Think Patented account executive or call 937.353.2299.