Kitting and bundling are often used interchangeably by merchants and retailers. This article explores how these concepts work and can help maximize profits for your eCommerce business.
Kitting and bundling have shifting meanings in eCommerce fulfillment. Some use the words interchangeably, while others have different definitions for each term. Both refer to selling products in a group instead of individually, and both kitting and bundling can help you increase sales and revenue. Here’s what you need to know to organize your inventory to take advantage of these fulfillment processes.
Difference Between Kitting and Bundling
Kitting involves organizing and grouping items before the order fulfillment process. By preparing kits in advance, your warehouse can streamline the picking and packing process by allowing pickers to retrieve entire kits as a single item instead of individually picking multiple SKUs. This pre-assembly of complementary products enhances the efficiency of your order fulfillment processes and can result in a faster turnaround time for your customers’ orders.
Bundling, however, involves packaging different products together to sell them as a single unit at a discounted price. Bundles can include complementary or completely different products but are often marketed as a special deal to entice customers to purchase more items. This strategy can increase sales by encouraging customers to buy more than they originally intended and can also help move slow-selling products by pairing them with more popular items. Additionally, bundling can simplify the buying process for customers by eliminating the need to search for and purchase each item individually.
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Bundling combines multiple products or services into a single offer, usually at a discount, while kitting bundles related items together for convenience. A home gym bundle may include weights, a resistance band, and a workout mat, while a skincare kit may contain a cleanser, toner, and moisturizer designed for a specific skin type.
Thrive in Your eCommerce Business with Kitting and Bundling
Kitting and bundling offer organizations a way to enhance customer experience by introducing new products, promoting slow-moving items, and allowing customers to explore a wider range of products in a single purchase. By bundling products in a visually appealing and functional manner, you can create a memorable unboxing experience that enhances customer satisfaction and loyalty. Moreover, these value-added fulfillment solutions can help reduce costs and increase customer engagement, ultimately improving your bottom line.
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The following are certain methods that can help maximize your profits:
- Save On Shipping Costs
Combining multiple items in a single shipment can significantly reduce shipping costs, particularly for large or bulky products that incur dimensional weight charges. Businesses can avoid additional shipping fees and reduce shipping costs by kitting small items with oversized products. Kitting and bundling can also save your business by lowering shipping costs per-item basis. Major shipping carriers, including FedEx, UPS, and USPS, typically charge a fixed base fee per package. By consolidating multiple items into a single parcel through kitting or bundling, you can minimize the number of packages required to fulfill an order. Therefore, you can leverage kitting and bundling to optimize shipping costs.
- Incentivize Multiple Sales
Kitting and bundling offer a powerful incentive for customers to purchase more items than they would have otherwise. For example, by offering a kit with a range of art materials, you can inspire a customer to try new techniques and explore a wider range of products. Similarly, bundling items with a price incentive can entice customers to purchase more items, increasing the average order value and reducing associated costs per order. While bundling items may result in reduced profit margins per item, the overall increase in sales can more than offset this, particularly when combined with kitting to encourage customers to purchase complementary items. Ultimately, leveraging kitting and bundling strategies can increase business revenue and customer loyalty.
- Make Gift-Giving Easy
You can enhance the gift-buying experience for customers and boost sales by providing curated gift packs, such as a spa-themed kit that includes soap, bath salts, and a face mask in an attractive box. These pre-packaged gift sets simplify the gift-giving process and save time for customers who don’t have to select individual items, leading to a more satisfying and stress-free experience. Furthermore, offering gift packs can help you differentiate yourself from competitors and foster customer loyalty by providing a unique and convenient service. Ultimately, offering kitted gift packs is a powerful tool for enhancing the customer experience and driving sales, provided you have strong logistics services.
The goal is to have an exceptional fulfillment experience
Integrating kitting and bundling into your product lineup can improve profits and streamline your eCommerce fulfillment operations, but managing inventory for these sets can be complex. Fortunately, you can count on your 3PL to establish consistent and effective procedures for incorporating kitted or bundled products into your inventory management system. By collaborating closely with your Third Party Logistics provider, you can develop clear guidelines for labeling, tracking, and stocking kits and bundles, ensuring seamless integration into your existing product lineup. With these well-defined standard operating procedures, you can improve operational efficiency, minimize errors, and enhance the overall customer experience.
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Your fulfillment company can also manage these operations on your behalf, freeing up your time to focus on other aspects of your business. At XPDEL, we offer customized product kitting and bundle fulfillment services that meet your unique requirements, allowing you to take advantage of the benefits of kitting and bundling without the hassle of managing it yourself.
XPDEL is a leading hi-tech provider of Fulfillment and Logistics Services on a mission to enable growth for eCommerce companies. We are futuristic in our vision and constantly work on creating technology that helps us meet customer expectations for today and tomorrow. Our wide network of Fulfillment centers enables us to efficiently handle nationwide delivery in the US – same day, next day, and 2-day delivery. Being closer to the end consumer, we deliver much faster than others.