What is a SKU Number?
A SKU number, or Stock Keeping Unit number, is a unique alphanumeric code or identifier assigned to a specific product in a retailer’s inventory or a business’s stock. SKUs are used to track and manage products efficiently within a store or warehouse. Each SKU is typically unique to a particular product variant, such as size, color, or packaging, allowing for precise inventory control and sales monitoring. SKUs can help retailers track inventory more accurately and avoid phantom stockouts. They can also inspire product displays and merchandising decisions and allow customers to find similar products easily. SKUs should be short and easy to read. Avoid using letters that resemble numbers, like “O,” which may be mistaken for zero.
What is a SKU Number?
SKU stands for “Stock Keeping Unit.” It is a unique alphanumeric code or number assigned to a specific product in a retailer’s inventory or a company’s catalogue. SKUs serve as a way to uniquely identify and track individual items or variants of a product within a more extensive inventory system. Here are some critical points about SKUs:
- Each product or variant in a retailer’s inventory is assigned a unique SKU to distinguish it from other items. This helps prevent confusion and errors when managing inventory.
- SKUs can contain a combination of letters, numbers, or symbols, and they are often chosen to reflect specific product characteristics, such as size, colour, model, or style. For example, a clothing retailer might use SKUs like “M-RED-TSHIRT” for a medium-sized red t-shirt.
- SKUs are used to track the quantity of each product in stock. When items are sold or restocked, the SKU is updated to reflect the changes in inventory levels.
- Retailers use SKUs to locate products in their inventory quickly. This is particularly important in warehouses or retail stores with many products.
- SKUs are often integrated into point-of-sale systems and e-commerce platforms. When a product is scanned or selected for purchase, the SKU is used to identify the item, its price, and other relevant information.
- SKUs are essential for order fulfilment processes. They help ensure the correct product is picked from the inventory and shipped to the customer.
- Using SKUs, retailers can efficiently manage stock levels, reorder products with low inventory, and identify slow-moving or obsolete items.
- E-commerce platforms heavily rely on SKUs to manage large catalogues of products. Each product variant, such as different sizes or colours of an item, typically has its SKU.
- SKUs are often encoded into barcode labels that can be scanned at various supply chain stages, from receiving inventory to point of sale.
- SKU data can be analysed to gain insights into product performance, sales trends, and inventory turnover, helping businesses make informed decisions.
Overall, SKUs are crucial in inventory management and retail operations, helping businesses keep track of their products, streamline processes, and provide accurate and efficient customer service.
A SKU is a Unique Identifier
SKU stands for Stock Keeping Unit and is an alphanumeric code that allows retailers to keep track of their inventory more efficiently. The code consists of multiple sections, each representing a specific product characteristic such as colour or size. Using a consistent format when creating SKUs is essential, as this will help avoid confusion and reduce the risk of phantom stock or unavailable recorded products.
The first section of an SKU is usually the broadest identifier, such as department or product category. The rest of the digits identify more specific characteristics, such as style or manufacturer. However, adding only a few traits to the identifier is essential, as this can lead to increased complexity and confusion. It is also essential to consider your sales channel partners when creating SKUs. They may follow a different system than yours, so it’s best to keep them informed before making changes.
| What is a SKU? |
A SKU can be defined by the following:
|
Unique Identification
Characteristics
Inventory Tracking
Ease of Retrieval
Point of Sale (POS) Systems
Order Fulfillment
Stock Management
Online Retail
Barcode Labels
Data Analysis
|
A SKU is a Barcode
A SKU is a code that helps businesses identify products and track inventory. It consists of letters and numbers, and it can be customised to reflect the unique characteristics of each product. Its length ranges from eight to 12 digits. The first section of an SKU code typically describes the broadest trait, such as the product type or department.
For example, Lee uses a SKU for their jeans that begin with the letter “D” and then moves on to determine the specific style of the garment, size, or colour. This allows them to create a simple and effective system for identifying their products.
SKUs differ from universal product codes (UPC) because they are unique to a particular business’s inventory. This makes it easy to keep track of stock levels and sales. It also provides a consistent naming system across all retail channels. A barcode scanner can scan these codes to display all the production and inventory information.
A SKU is a Serial Number
A SKU is a unique identifier that helps retailers track inventory. Its format is typically eight to twelve alphanumeric characters that can be customised for your business. The first two or three characters represent the broadest category for a product, such as a department, brand, colour, or size.
The middle part of a SKU is more specific and includes information about the product. The last five or six characters indicate the quantity of the available item for sale. SKU numbers help retailers keep a consistent and efficient system for tracking inventory and eliminating phantom stock.
SKUs can be used with POS (Point of Sale) systems to provide valuable sales data. They can also reduce sitting inventory and make it easier to return items. A well-designed SKU number system can significantly improve the efficiency of your inventory management process. It can save you money by reducing the time it takes to sell your products and eliminate backorders.
A SKU Is A Marketing Tool
A well-implemented SKU system can help reduce sitting inventory, eliminate pesky backorders, and smooth the entire product inventory management process. It also saves on storage costs and prevents waste inventory from accumulating. SKUs are a valuable retailer tool and can be customised to fit business needs.
SKU codes are typically a combination of letters and numbers that describe the product’s attributes, including price, colour, size, manufacturer, and other details. These codes can be customised to fit a company’s inventory needs and easily tracked using POS systems.
For example, a famous projector screen brand offers hundreds of variations in colour, size, and mounting options, resulting in thousands of possible SKU combinations. This allows the company to efficiently manage its inventory and track sales data for each product. This helps the company improve customer satisfaction and increase profits. It can also make it easier for customers to compare products and find the best fit for their needs.
SKU Number – Other useful links from our Knowledge Centre:
How to Manage Business Finances Correctly and Efficiently
Unlocking Business Potential: Strategies for Long-term Success
The Impact of Sustainability on Ecommerce Businesses
Remember to Compare Your Business Costs is here to help your business every step of the way from business advice, or saving you time and money on your business purchases such as: