As companies continue to outsource selected parts of their manufacturing process and continue to “Lean” out their operations it has become increasingly important to rely on “kitting” services as a cost-saving and time-saving measure. The Custom Kitting service provided by The Hope Group has been available for its major customers for over a decade with great success. As an early proponent of the kitting concept, The Hope Group developed several processes that met the need of MRO as well as OEM facilities. Today, the OEM operations dominate its activity as New England manufacturers seek ways to remain competitive within an increasingly challenging global marketplace.
Saving OEMs Money and Time
Custom Kitting has been an integral part of the overall supply chain process for many years. In simple language, it’s a process of reducing manufacturing steps as a technique for cost and time saving. A Custom Kit in a manufacturing setting is a system that presents required parts to a worker on an assembly line or workbench in an organized manner. As all the items required are presented in an orderly manner, they can be removed from the “kit” quickly and without damage.
Beyond the improved efficiency for the worker, a custom kit of goods destined for the assembly line has the hidden effect of reducing the number of lines on an invoice. That happens when many parts become “one part” as part of a “kit.” That may not seem important unless the lines number in the millions, which is often the case for a large manufacturer. Keep the invoicing simple by reducing the lines and everyone wins.
Another hidden benefit to custom kitting is improved cash flow. As you diminish the amount of stock holding, you automatically improve cash flow. Each small benefit of custom kitting keeps contributing to reduced cost and time expense. For example, if the custom kit reduces inventory, that reduces the requirement for floor space, which reduces your rent. It’s another hidden savings, beyond just the cost of the product in the bin.
Zero Defects Results
As each of these hidden benefits emerges, other aspects of savings become clearer. For example, when a customer finally gets a product that has no defects, partly as a result of a precise custom kit utilized in the assembly process, the reduced returns and customer complaints are priceless. One of the ways quality is improved by a “kit” is the elimination of guesswork. If a “kit” has been used on an assembly and a component is left over after the process is finished, then a problem has been spotted before it becomes a problem for the customer. Fix it now, before it ships. The hidden benefit of Custom Kitting from The Hope Group continues.
The use of Custom Kitting in the overall supply chain process has been very profitable for The Hope Group and its customers. Together, with KanBan services, VMI (vendor managed inventory), EDI (electronic data interchange), bin-stocking programs, just-in-time delivery and other supply chain processes, the Custom Kitting idea has been a winner.