Inventory management and Inventory kitting: A cycle count means a small amount of inventory is counted by a particular day without a full manual inventory.
Good practices for inventory counting
The quantity of inventory you track depends on the types of items you sell and your available resources. For instance, conducting an ABC inventory analysis helps you evaluate your class A products and focus more frequently on your highest-value items.
Irrespective of the particular approach to inventory statistics, here are several best practices:
- Count one category at a time. Ideally, rotate the entire inventory over a set period. Focusing on one class ensures effective counting during business hours without disruptions.
- Choose seasonality-based categories. The inventory count aims to correct discrepancies as they arise, so it’s best to count items at their peak to address problems immediately.
- Complete the cycle count plan. Unfortunately, inventory shrinkage can sometimes result from personnel theft.
- Random cycle counting allows you to select a number of items to count during each cycle when your warehouse has many similar items. This approach prevents overwhelming any group at once, enabling counting during business hours.
- ABC cycle counting classifies items into categories A, B, or C based on the ABC inventory management technique and the Pareto principle. This method counts category A items more frequently than B and C items.
What’s the inventory kitting?
The method of grouping, packaging and selling widely divided products is an inventory kitting, often killed as ‘product bundling.’ Usually, the inventory system adds each individual item to the sale automatically when you buy a kitted item.
Sets packed
Packaged sets promote consumer purchasing by providing pre-set amounts, colors, and mixtures of products. Moreover, they function as convenient gift packages, enabling consumers to shop for presents without planning. As a result, this strategy enhances customer service and increases order value for the company.
Boxes to subscribe
The market now offers a wide variety of subscription boxes—ranging from beauty and clothing to coffee and food. Similar to boxed sets, subscription boxes enable consumers to purchase multiple items in one transaction, which increases order values and encourages repeat customers. Furthermore, this convenient service caters to customers with little time to manage ongoing product orders.
Items preassembled
IKEA furnishings often receive a bad reputation because they require assembly at home. Product assembly acts as a form of inventory packaging, allowing you to sell individual items together. Additionally, kitting helps monitor inventory parts and reorder in production and wholesale operations. In retail, product assembly provides consumers with more options and enhances service quality.
Customized and customized products
Custom-made products can be considered as kitting by using separately tracked materials to create a product that is ready to be sold from an inventory management perspective. For example, if a custom lace collar is applied to a single shirt, it is known as a kit if both the neck and the shirt are stocks in your inventory management system.
