Inventory and stock
What is an SKU? Meaning, format and examples
Definition
SKU: An SKU (stock keeping unit) is a short code a business gives each item it stocks, so every size, colour or pack can be counted and found separately.
Also called: stock keeping unit, SKU code, SKU number, product code, item code
What SKU means
SKU stands for stock keeping unit. It is a code you choose for each item you count separately in stock. If a customer can pick between two versions and you need to know how many of each you have, each version needs its own SKU: garam masala 100 g and garam masala 500 g are two SKUs, and so are a red kurta in size M and the same kurta in size L.
An SKU is not the same as a barcode. A barcode number such as an EAN-13 is printed on the pack for scanners and, for branded goods, comes from GS1, so the same biscuit carries the same barcode in every shop. An SKU is internal: two shops selling that biscuit will usually give it different SKUs. Many businesses use both, the SKU for people and the barcode for scanners.
How to build an SKU code
A good SKU is short, readable and built the same way for every product. A common pattern is a short product code followed by only the details that change between versions.
- Start with a 2 to 4 letter code for the product or style, such as GM for garam masala or KUR for a kurta range.
- Add the details that change: size, colour, flavour or pack, as in GM-500G or KUR-RED-M.
- Use capital letters, numbers and hyphens. Spaces and symbols get mangled by spreadsheets and some scanners.
- Keep it under about 15 characters so it fits on labels, invoices and the counter screen.
- Leave out price, supplier and dates, which change while the product stays the same.
Common SKU mistakes
The most common mistake is one SKU for several versions, such as one code for every size of a shirt. Stock then looks fine in total while size M has sold out. Reusing an old SKU for a new product mixes its sales history with the old one, and changing SKUs after labels are printed leaves old labels pointing nowhere. Letters that look like numbers, such as O and 0 or I and 1, cause typing errors at the counter, so many businesses avoid them.
Worked example
SKU codes for a masala maker and a garment store
A masala maker sells garam masala in 100 g, 500 g and 1 kg packs, so it uses three SKUs: GM-100G, GM-500G and GM-1KG. A garment store stocks the Anaya kurta in three colours and four sizes, which is 3 × 4 = 12 SKUs, from KUR-ANY-RED-S to KUR-ANY-BLU-XL. When a count shows KUR-ANY-RED-M at zero and KUR-ANY-RED-XL at 14, the owner reorders the size that sold, not the whole style.
In managemate
Every product in managemate has an SKU, shown in the form as SKU / product code, of up to 80 characters and unique within your workspace. It sits under the product name in lists, pickers and forms, and you can search for it or scan it to find the product. On labels, a product without its own barcode prints its SKU as a Code 128 barcode. For products with variants, managemate suggests each variant's SKU from the product code and its option values, such as TEE-RED-M, and you can change any of them. A saved variant keeps its SKU when you rename an option value, so labels you have already printed keep working.
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