Kitting & Assembly Cost Calculator

Should component cost be included in the kitting fee margin?

Usually not — component cost is typically passed through to the client at cost or billed separately as inventory, since it's the client's product being combined, not a 3PL cost input. The kitting fee margin calculation here excludes component cost by design and focuses on what the 3PL actually controls: labor efficiency and packaging cost.

Make-to-stock or make-to-order kitting — which is cheaper?

Make-to-stock (pre-building kits ahead of orders) is cheaper per unit because assembly can be batched efficiently, but it locks capital into a specific SKU combination and creates obsolescence risk if the kit composition changes or demand doesn't materialize as forecast. Make-to-order costs more per unit in labor time but eliminates that inventory risk — the right choice depends on demand predictability and kit complexity.

How much does component count affect assembly time?

Assembly time scales roughly linearly with component count for simple kits (grab, verify, place), but complex kits requiring custom folding, shrink-wrapping, or multi-step assembly can take 2-3x longer than a simple bundle with the same component count. Time-study your actual kit types rather than assuming a flat rate across all kit complexity levels.

What's a competitive kitting fee?

Simple 2-3 component bundles typically run $0.75-$2.50 per kit in fee; complex multi-component kits with custom packaging or assembly steps can run $4-$10+ per kit. Benchmark against your actual labor cost calculated here plus target margin rather than copying a competitor's rate card, since your labor efficiency and wage rate directly change what's profitable.