How SKUs work
Each variation gets its own code. A t-shirt in red, size medium has a different SKU from the same shirt in blue, size large. Inventory systems, online stores and warehouses use these codes to track stock and fill orders.
SKU versus UPC
A SKU is created by each business for its own use, so the same product can have different SKUs at different stores. A UPC is a standard barcode number that stays the same for that product everywhere it's sold.
Creating a simple system
Good SKUs are short and readable, using letters and numbers that stand for things like product type, style, color and size, such as TS-CREW-RED-M. Avoid spaces and characters that can confuse software.
Why SKU matters
Clear SKUs prevent overselling, picking errors and messy reports. They also matter for online sales, since shopping feeds, marketplaces and inventory tools rely on consistent product codes.
Ending the wrong-size shipments
A small apparel brand used product names instead of SKUs, and packers often shipped the wrong size. Giving every size and color its own SKU and printing it on shelf labels cut shipping mistakes and made stock counts accurate.
Common mistakes
Reusing SKUs
Giving a new product an old product's SKU scrambles sales history. Retire old codes instead of recycling them.
Overly long codes
Long, complex SKUs are hard to read and type. Keep them short and consistent.
Starting with zero
Some spreadsheets drop leading zeros. Start SKUs with a letter to avoid errors.
Where we work on this