SKUs: definition, purpose and operation

When it comes to logistics and trade, mastering product information management is crucial to a company's success. At the heart of this management is the Stock Keeping Unit, commonly known as the SKU. The definition of a SKU is: a unique alphanumeric code assigned to each product in a company's inventory, enabling precise tracking and streamlined inventory management.

The definition and appropriate use of SKUs is essential for manufacturers, retailers and e-tailers aiming to optimize their supply chain and respond effectively to market needs.

SKUs play a crucial role in the day-to-day running of a warehouse, facilitating not only the rapid location of products, but also sales analysis and stock forecasting.

A clear SKU definition also helps to avoid delivery errors and guarantee a better customer experience. What's more, in the age of omnichannel commerce, where customers can buy across a variety of platforms and points of sale, uniform SKUs across these channels are essential for cohesive inventory management.

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What does SKU stand for?

The acronym SKU stands for Stock Keeping Unit. Each SKU is a unique identifier that relates to specific product information, such as price, supplier, size, color and other relevant attributes.

This distinctive marker enables retailers and warehouse managers to track each item individually, and facilitates order management, replenishment and marketing strategy.

For example, two very similar products in different colors will have distinct SKUs to distinguish one from the other, which can be essential for successful online sales and restocking.

Where can I find a product's SKU?

A product's SKU is usually found on its packaging, near the barcode or on the price label. It may also be included in a company's online catalog or on the product detail page of an e-commerce platform. For companies using product information management systems (PIM) such as Quable, the SKU is a central element of data organization and is accessible via their user interface.

The PIM tools enable SKUs to be entered, updated and used for a multitude of purposes, from internal logistics to the consistent publication of product data across multiple sales channels.

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What is a seller's SKU?

The seller's SKU, sometimes referred to as an internal reference, is the specific SKU code to which a manufacturer or retailer has assigned a product in its own inventory management system. This code is specific to the company and is generally not visible to the customer. It enables the seller to organize his inventory and track sales and stock levels for each item in an optimized way.

The vendor SKU is particularly important for companies with a wide range of products or rapid stock turnover, as it enables detailed analysis and facilitates the replenishment process.

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What is a marketplace SKU?

On a marketplace, a SKU has the same function as with an individual retailer: to uniquely identify a product. For a marketplace seller, using SKUs is essential to effectively manage inventory across multiple platforms. It's important that SKUs are consistent across all sales channels to avoid confusion and enable real-time synchronization of stock levels.

When a SKU is associated with its corresponding product in the marketplace database, this makes it easier for customers to find it, and improves the online shopping experience.

The link between PIM like Quable and SKUs

A product information management system (PIM) such as Quable is a powerful tool for companies looking to optimize their SKU management. With over 300 major brands and more than 40 million products managed, Quable offers a centralized solution for harmonizing product data across different sales channels.

The complementarity between PIM and SKUs is obvious: PIM is used to organize, store and distribute product data, including SKUs, worldwide. Consequently, integrating PIM with existing inventory and order management systems ensures that product information is up-to-date, consistent and easily accessible to all stakeholders.

In conclusion, the proper understanding and use of SKUs in logistics operations is vital for any company seeking to excel in today's competitive marketplace. Tools such as PIM, and in particular the solutions offered by Quable, represent a cornerstone in the inventory management strategy of international brands and manufacturers, ensuring the success of their omnichannel operations.

To find out more about product information management and how it can help your business, please visit our comprehensive glossary.

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