More and more orders. Is your e-commerce inventory becoming harder to organize and track? Do you want to keep inventory and get data on it? This is your time to Use SKU numbers for inventory management. Designing an SKU system to sort inventory will save you even more time and meet customer 1-2 day delivery expectations.

Follow this article then takes you through how SKU in inventory management can help your business maintain control over sales and profitability.

SKU (Stock Keeping Unit) in inventory management refers to the number assigned to the product. For manage inventory and easy product tracking. In other words, an SKU is the unique identifier of the product sold by the retail trademark.

Typically used by retail stores, warehouses, and product fulfillment centers. Generally, SKUs are divided into two different categories: classification and category.

Some retailers create their own unique code based on the characteristics of their products. This allows retailers to track inventory, analyze sales by product category, and even use this number to design store layouts and processes to enhance the consumers’ shopping experience.

What is the difference between SKU, EAN, and UPC codes?

Many people confuse SKU with EAN or UPC codes (collectively referred to as “barcodes”). The following table shows the main differences between them:

SKU (Stock Keeping Unit): A coding classification method after products are put into storage.

EAN (European Article Number): A barcode for commodities developed by the International Article Numbering Association and used in the world.

UPC (Universal Product Code): A commodity barcode developed by the United States Uniform Code Committee.

An SKU number is a combination of letters and numbers. These combinations of numbers and letters provide detailed information about the product. Such as its make, model, size, color, and more.

Each merchant creates SKUs for products in their own way. Simple and easy-to-understand SKU numbers are the most effective.

Let’s assume that the SKU assigned to a particular product is: a medium blue body.

We can build the following SKUs for this product: blu-tee-med-CF26

Detail:

SKU numbers are used in both e-commerce and retail. There are several main reasons why e-commerce businesses use SKUs:

Your business should establish a set of criteria for creating and assigning SKUs.

For example, what attributes the SKU catalog has, and how the order in which the attributes of the product information are presented. Such as product category, color, size, model, etc.

The purpose of the only SKU in inventory management is to distinguish each product from all others, so two different products having the same SKU is not for the purpose. The exact same item may have two different SKUs in two different businesses.

One of the biggest benefits of SKUs is that they allow you to differentiate particularly similar items and sell them together on physical shelves and in online stores.

Differentiating similar products with similar SKUs not only keeps inventory organized, but also recommends alternatives to the same type of product to customers when they sell out of the goods they need, even if the customer is satisfied and the sale is completed.

When creating an SKU system, remember to record the dimensions and weight of each SKU. Many businesses tend to skip this step, but it’s necessary to accurately estimate your inventory capacity.

SKU management systems can simplify SKU tracking over time and facilitate inventory counting. Whether it is for physical stores or warehouses, or for accounting purposes, it is very convenient.

Inventory management software can automate most SKU management processes and provide detailed visibility into SKU levels, assortment, order history, sales records, and shipping confirmations.

Finally, I would like to say that for SKU generators, although you can use the generator, it is best to write according to your own management habits.

Take the Amazon platform, whether you build new products or sell existing products, you need a corresponding SKU in inventory management, about the SKU writing rules, Amazon does not strictly require, the SKU column can be filled in by the seller himself, if not filled in, Amazon will automatically generate an SKU code assigned to you, although it is very trouble-free, this will make it difficult to identify. Therefore, in order to facilitate the management of products in the future, it is best for sellers to write SKUs according to their own management habits or product characteristics.

SKU system is a must to keep your inventory and manage everything in order. The handling of SKUs is actually very complex and time-consuming. So you also need 3PL cooperation with technical support. Outsourcing inventory storage and order fulfillment to Honest FulPhilment can help you focus more on your core competencies while saving you time. Contact us now.

• What is SKU in supply chain management?

• What is an SKU (Stock Keeping Unit)?

• Stock Keeping Unit (SKU) Definition.