In the supply chain, operational excellence is often built on non-linear solutions. Instead of suppliers simply shipping finished goods downstream, warehouses add a strong layer of efficiency by creating kits and bundles to support promotional campaigns or fulfill client-specific orders.
Beyond that, they handle final-stage configuration and light assembly, adding components as needed to streamline fulfillment and shipping.
These Value-Added Services (VAS) in the warehouse are known as kitting and assembly. And though the lines between them are often blurred, the two terms offer distinct solutions.
Quick Definitions: Kitting (vs Assembly)
Warehouse kitting services prepare on-demand multi-product kits by grouping separate items into a new SKU.
Assembly, however, leans toward light rework, transforming raw components or sub-assemblies into a new, finished product, or physically joining and fitting add-ons into a ready-to-use SKU.
That said, let’s dive in deeper.
What Is Kitting?
In the warehouse, kitting is the preparatory process of combining two or more separate items, each with its own existing SKU (Stock Keeping Unit), into a single package, which is then assigned a new SKU and handled as a single line item throughout the rest of the fulfillment process.
Today, the 3PL kitting and fulfillment market is valued at ~11.55 billion and is projected to grow at a CAGR of 13.5% from 2026 to 2033, reaching an estimated 31.81 billion.
Examples Of Kitting In The Warehouse
There are numerous real-world applications of inventory kitting:
Subscription Boxes
Combining various items, like a 30-day supply of nutritional supplements, into a single branded box for monthly delivery.
Computer Bundles
Packing a laptop along with its charger, mouse, and external keyboard.
Hardware Sets
Grouping the specific screws, nuts, and washers required for a piece of furniture into a single bag.
E-Commerce “Buy-The-Look” Bundles
Combining a jacket, a pair of jeans, and a t-shirt into a single SKU for quick fulfillment.
Promotional Sampler Packs
Grouping various snack bar flavors into a single display unit for grocery stores.
Welcome Kits/Onboarding Packages
Assembling branded corporate swag (notebooks, pens, t-shirts, water bottles) for new employees.
Seasonal Gift Sets
For a holiday promotion, a 3PL combines a retail-ready coffee mug, a bag of gourmet coffee beans, and a small packet of biscuits into a single festive shrink-wrapped package, which is then palletized and shipped to big-box retailers as a single item.
Benefits Of Kitting
In the warehouse, packaging and kitting strategies offer diverse benefits:
Increase Sales And Revenue
Kitting can be a strategic tool to increase Average Order Value (AOV) by promoting bundles of related items rather than individual products. On top of higher overall sales, this approach also offers better value to the consumer.
Clear Slow-Moving Stock
Kitting inventory helps offload “dead stock”. By bundling low-demand products with more popular items, retailers can free up valuable shelf space for more profitable merchandise. This approach also reduces the total number of SKUs that must be tracked, making inventory audits significantly easier.
Foundation For Recurring Revenue
Subscription box brands rely on kitting fulfillment to offer a consistent experience and timely service to their customers and support a consistent revenue stream.
Flexibility And Customization
Businesses use customized packaging and kitting services to bundle disparate products under a unified kit and offer shoppers tailored, yet branded, experiences that ultimately enhance loyalty and repeat sales.
Streamline Warehouse Processes
Oftentimes, kitting is a warehouse optimization technique where items typically ordered together are pre-kitted in advance. This helps reduce the inventory storage space needed, minimize picker travel time, and accelerate order processing.
Kitting is an increasingly popular service that captured 46.12% of the Kitting and Assembly Packaging Services Market share in 2025, and experts believe it will grow further in 2026.
Common Types Of Kitting
Used across all stages of the supply chain, from manufacturing to e-commerce fulfillment, kitting is usually classified into four core types:
1. Order Kitting
Gathering items specifically requested by a customer to fulfill a unique order.
2. Promotional Kitting
Creating special bundles for marketing campaigns, such as including free samples with a purchase.
3. Replenishment Kitting
Kits are used to restock specific inventory zones or satellite locations.
4. Assembly Kitting
Preparing components required for a later manufacturing or construction process.
What Is The Kitting Process In The Warehouse?
A standard kitting process in warehouse facilities follows these key steps:
- Product Verification: The system confirms that all necessary components are in stock.
- Component Picking: Bulk or individual items are picked from their various storage locations and transported to a dedicated kitting station.
- Grouping Together: Kitting station operators follow work instructions to combine the items into the new packaging (box, bag, etc.).
- SKU Assignment: The new kit receives its unique single SKU label and is scanned into inventory management as a completed item. The component SKUs are simultaneously deducted from stock.
- Staging: The completed kits are moved to a forward pick location or staged for immediate outbound shipping.
- Shipping: Labeling and sending the kit as a single unit once an order is triggered.
Kitting vs Assembly – Core Differences
While often used interchangeably, there is a distinct difference between kitting and assembly.
Kitting is about grouping independent items that remain unchanged and could, in theory, be disassembled back into their original parts. In contrast, assembly is a constructive or transformative process where components are permanently combined to create a new, functional whole.
So, while kitting deals with grouping and packaging, assembly involves physical workings or modifications.
To better understand the difference between assembly and kitting, let’s look at some examples.
Examples Of Assembly In A 3PL Facility
In a 3PL environment, assembly and kitting services can involve light manufacturing or custom rework – for instance:
Point-Of-Purchase (POP) Display Construction
The 3PL physically builds complex, multi-shelf cardboard displays from flat-packed pieces using fasteners and adhesives.
Clothing Embellishment
Using heat presses to permanently adhere branded patches to blank jackets or T-shirts.
Custom Spice Grinder Filling And Sealing
A 3PL receives empty grinder tops, glass bottles, and bulk ingredients (peppercorns, sea salt, dried herbs). Workers physically fill the bottles to a specific weight, attach the grinder mechanism, apply a heat-shrink safety seal, and then label the finished product as a single SKU.
Appliance Sub-Assembly/Customization
A client provides base models of a countertop appliance, different colored knobs, and various power cords (US, EU, UK). The 3PL staff physically attach the region-specific power cord and install the color-selected knobs to the base unit to create a market-specific SKU ready for sale in that region.
Nearshore Kitting And Assembly In Tijuana, Mexico With Loginam
If you need more than just storage and shipping, Loginam helps turn warehouse VAS into a repeatable advantage through nearshore operations in Tijuana, Mexico, right next to the U.S. border.
At Loginam, we support B2B teams with controlled kitting and light assembly workflows that follow BOMs and work instructions, backed by inline QA/testing checkpoints and traceability by lot and serial number.
By handling retail-ready packaging and final-stage configuration, your bundles, kits, and market-specific SKUs ship cleanly and consistently, without adding internal overhead.
Thanks to EDI and WMS integrations, workflows remain trackable end to end, with clear inventory and order status updates for cross-border teams.
Ready to simplify kitting and light assembly at scale? Request a custom quote!
