Distributors' prime aim is to boost sales. And, to increase the average order value they preferably sell bundled products as a packed set. It helps wholesalers and distributors get better deals. The entire kit contains different products, but from the same genre such as medical kits and drum kits, is sold as a single product.
What is inventory kitting and it helps distributors increase their sales?
Inventory kitting is simply defined as the process of bundling multiple individual products together into one product, or you can call it a product package with a single SKU (Stock Keeping Unit). It greatly helps in streamlining the customer purchases, reducing return rates and improving the shipping efficiency. You don’t need to market and sell a single product (unless the client asks for), but a complete and custom package of multiple items that belong to the same category. The best <a href="https://www.mie-solutions.com">ERP software for manufacturing</a> can manage entire inventory through a process.
Key benefits of inventory kitting for distributors:
Not only the retailers, wholesalers and distributors, inventory kitting also presents clear benefits for the consumers. They get all in one package that helps them save a significant amount of money. Spend the bucks only for what you actually need, not otherwise.
Similarly, inventory kitting happens to be a powerful tool for wholesalers and distributors because selling multiple products in a single kit improves the average order value and hence, generates cost-saving efficiencies vital for your business’s profitable success.
Let’s see what else inventory kitting brings for distributors.
Enhanced Order Value: Inventory kitting is a great way to increase the average value of your received orders that eventually leave a positive impact on your bottom line – improves cash flow.
Lower Inventory Costs: To keep your inventory holding costs as low as possible, inventory kitting is the right solution. Moreover, it also frees up the warehouse space to manage more products.
Reduce Return Rates: Customers usually return the items that are incompatible with what they were looking for. To avoid this and save customers from any confusion, it’s better to offer them fully guaranteed, compatible items as a single, exclusive product.
Beat the Competition: Provide your customers all-in-one solution using inventory kitting. It will help you stand out from competitors selling the same items but not as a complete package. People are more likely to purchase kits that are cost-effective and help them streamline their retail experience.
Cost-Effective Shipping: Inventory kitting helps reduce the shipping cost. If you create customized packages for your customer-required kits and then weigh and label them as a single SKU, it will help reduce handling errors and delivery costs.
Improved Inventory Tracking: As a distributor, you can maintain and track your inventory stock more effectively through kitting. This is specifically true for the dead stock – items that stay on the shelves longer than expected.
Rebrand Dead Stock: Inventory kitting helps you push all the products sitting on the shelf into the sales funnel. Gather up all loose ends and rebrand your dead stock by bundling them with successful products that sell well. For instance, threads that may not be sold well on their own could be included in the travel or crafting kits and hence sold out quickly and easily.
Bottom Line: Inventory kitting is an excellent strategy to satisfy consumer needs and sell your products in a highly organized and cost-effective way to boost sales. Well, the key to its success and gaining all the associated benefits need the distributors to know the end-users.