What Are SKU Numbers and How to Define Them?

SKU, or stock keeping unit, refers to unique codes that businesses assign to each product or service for the purpose of ensuring proper management of inventory. With these codes, organizations can systematically identify all stock levels, sales trends, and reorder schedules. Thus, an Stock Keeping Unit can serve to organize and automate operations irrespective of the size of the company.

Thus, SKU is an integral part of inventory management in businesses of all sizes since it facilitates operations and organization.

What Does It Look Like?

An SKU number is typically a combination of letters and numbers that represent key product details, such as brand, category, color, size, or other attributes. For example, an SKU for a pair of black running shoes might look like this: RUN-BLK-10.

The structure and length of an SKU can vary, but they should always be simple, consistent, and meaningful to your business. This helps team members quickly identify products and reduces the chance of errors.

How to Define SKUs for Your Business

Defining SKUs is straightforward if you follow a few key guidelines:

1. Keep It Simple: Use short and meaningful codes that are easy to read and understand.
2. Be Consistent: Stick to a standard format, such as “Category-Color-Size” or “Brand-Type-Model”.
3. Avoid Special Characters: Stick to letters and numbers to prevent issues with software compatibility.
4. Make It Unique: Ensure every SKU is distinct to avoid confusion between similar items.
5. Think Ahead: Plan your SKU system to accommodate future growth, such as adding new product lines or categories.

For example, if you’re selling clothing, an SKU for a red medium-sized t-shirt could be TSH-RED-M.

Why Is It Important?

SKU numbers are vital for maintaining an organized inventory. They allow businesses to:

• Quickly locate products in a warehouse.
• Track sales and identify popular items.
• Simplify restocking and inventory audits.
• Integrate smoothly with sales and inventory management software.

By using an effective SKU system, you save time, reduce errors, and improve overall efficiency.

Simplify Your Inventory Management with Skala Suite

Looking to take your inventory management to the next level? Skala Suite offers advanced tools to help you create and manage SKUs effortlessly. Discover how to streamline your inventory management now!