What is SKU?

SKU stands for Stock Keeping Unit. It is a unique identifier assigned to each distinct product in a store or warehouse. SKUs are primarily used for inventory tracking and management purposes.

Think of a SKU like a secret code that helps stores and warehouses keep track of their products. Just like how each person has a unique name, each product gets its own special code called a SKU (Stock Keeping Unit). This code helps the store know exactly what they have and where it is.

Example

Let’s say you have a store that sells different types of shoes. Each shoe style, color, and size combination might have its own unique SKU.

So, if you have a red sneaker in size 7, it might have an SKU like “RD-SNK-7”.

And if you have a blue sandal in size 8, its SKU might be “BLU-SND-8”.

This way, when someone wants to buy a specific shoe, the store can easily find it by looking at its SKU. It’s like a secret code that helps keep everything organized!

Assigning SKU

Assigning SKUs to products involves creating a unique code or alphanumeric combination for each product. Here’s a general process for assigning SKUs:

1. Create a System: Establish a systematic approach for generating SKUs. This can include using a combination of letters, numbers, or other characters that represent certain product attributes.
2. Identify Product Attributes: Determine which attributes are essential for distinguishing one product from another. This might include factors like product type, size, color, material, or any other relevant characteristic.
3. Develop a Naming Convention: Define a consistent naming convention for generating SKUs. This could involve using abbreviations or codes for different attributes. For example, “ABC123-BLUE-LARGE” could represent a blue, large-sized product in a certain category.
4. Generate Unique Codes: Once you have your naming convention in place, create unique codes for each product based on its attributes. Ensure that each SKU is distinct and not duplicated for any other product in your inventory.
5. Implement in Inventory System: Input the assigned SKUs into your inventory management system or database. Make sure the SKU is associated with the correct product and that it is easily searchable within your system.
6. Label Products: Assign physical labels or tags with the corresponding SKUs to each product. This makes it easier to identify and track products physically in your warehouse or store.
7. Regular Review and Update: Periodically review your SKU system to ensure it remains effective and scalable as your product inventory grows or changes. Make adjustments or updates as needed to accommodate new products or changes in your business.

By following these steps, you can effectively assign SKUs to products, enabling efficient inventory management and tracking within your business operations.