After you’ve added everything to your Dashboard, you can organize your inventory by creating various categories, like jewelry, shoes, and clothing. When done well, SKU management allows you to optimize your inventory levels and purchasing (and increase revenue). SKU management allows you to analyze the cost of carrying each product so you can be sure that every piece of inventory meets the financial objectives of the business. They are similar but serve different purposes for in-store and online retailers. Veeqo is free, no matter how large your business and how many shipments you send. Sign-up today to get access to our powerful inventory management and shipping software, and discounted shipping rates.

All this is near enough impossible if you’re selling across multiple channels without aligned SKUs being pulled into a centralized system. Without SKUs and a central stock figure, you’d never be able to keep on top of when inventory is getting low for each product and its variants. Most popular platforms and sales channels what means sku will have similar options and ways for you to update SKUs. If you have a lot of products, it’s probably worth exporting all your product data to CSV, editing the SKUs there and then importing the info back in. SKUs are also not universal – meaning they can be unique to your business, and tailored to what suits you best.

1. A common format is to use a combination of letters and numbers (e.g., ABC123).
2. Given that SKUs are unique to specific items, they give you a simple — and accurate — way to discuss individual products with your supply chain partners and other stakeholders.
3. Typically, SKUs are broken down into classifications and categories.
4. Read more about how Square compares with Shopify and other POS systems.

Avoiding these mistakes can help ensure that your SKU system is effective and accurate. This could mean updating SKUs when you introduce new product features or discontinue certain products. 💡 The Stocky app by Shopify automatically calculates reorder points based on supplier lead times, so you won’t run out of your most popular SKUs.

What Is a SKU and How Should You Use It?

It’s simple to automate this process when you connect your Point of Sale (POS) system with your inventory management software. This way, you can easily track products inventory and sales through SKU management. The SKU is then entered into the inventory management system, which is tied to the point of sales system. The retailer is then able to track inventory and sales through detailed reporting. An SKU system also allows retailers to create data regarding their customers, sales, and inventory.

Decide on the format of your SKU

SKUs can be any length, but they’re typically between eight and 12 characters. This length reflects the necessary information about a product without additional bulk. Also, most inventory management systems are built to read SKUs within this range, so longer codes may cause delays or malfunctions. SKUs are making the shopping experience more efficient than ever before.

Dashes separate the numbers and letters in a SKU, so spaces aren’t necessary. Also, avoid using punctuation or special characters, as humans and POS software may not read them correctly. To ensure your SKUs are as useful and accurate as possible, here are five pointers business owners should keep in mind. Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page.

UPC (Universal Product Code)

But it becomes extremely important if you sell items from Nike, Adidas, Reebok, etc. Other SKU identifiers may include store information, location information, or department information. Or really anything that will make it easier to categorize your products. Finally, the last two to three numbers are sequence identifiers. The first large blue teddy bear would end with a sequence modifier of 001.

Products

If you’re in the business of making products, you have a few options. You can create your own system, you can use an existing numbering system, or you can use a third-party vendor’s numbering system. Before choosing a numbering system, make sure you understand both how your customers buy your product and information that’s useful when you sell it. Keep in mind that the numbering system you choose will remain with your product for the rest of its life. The SKU number and the product’s serial number are two different things. The serial number is an individual identifier for a specific unit of that product, and aside from reviewing purchase records, only a customer has access to a serial number.

Then again, there are a lot of retailers that use UPCs as SKUs. But smaller shops (especially those that make their own products) may find it beneficial to create their own SKU system. In Shopify, for example, you can just highlight all your products in the Products page, then click the Edit Products button to bulk edit. The humble stock-keeping unit (SKU) may seem like an innocuous little number. They keep track of inventory and are useful to have for POS systems.

If you go the manual route, you need to calculate two metrics — SKU ratio and sales ratio — and then compare them. Millions of companies use Square to take payments, manage staff, and conduct business in-store and online. In Veeqo you get a list of products in that warehouse to count, and can easily make changes if any discrepancies are found. But without one aligned SKU per variant, you and your team would be completely wasting time. You can even easily draw up a quick purchase order, and auto-populate all your products low on stock for each warehouse and/or supplier. We always recommend standardizing and aligning your SKUs across every sales channel.

Best iPad POS Systems for Small Businesses

As long as you don’t have more than 99 departments, or over 9,999 products in a given department, this system works and is simple to enter and maintain in any POS system. Alternatively, using Square for Retail will allow you to print product labels with your SKU numbers and corresponding barcodes directly from your inventory catalog. Then, https://1investing.in/ as you scan items, your inventory system can track products based on their SKUs. For example, assume a retailer for a new locally owned lawn and garden store needs to come up with SKUs to begin their inventory procedures. They might assign the letter A to mowers; A1 could signify riding lawnmowers, while A2 might represent pushmowers.

To run a business efficiently, it’s important to know what you have available to sell. SKUs should not be confused with model numbers, although businesses may embed model numbers within SKUs. Alternatively, if you don’t need to see product attributes in the SKU, you may find it easier to just stick with a product group and product number approach. A slightly more sophisticated approach is to adopt an alphanumeric system of letters and numbers, such as ABC12345. That’s all well and good — after all, stock-keeping units are totally customizable. In the world of retail-related acronyms, SKU is likely one that you’ve heard a million times but you might not know the meaning.

This can provide valuable insights into which products are selling well and which ones aren’t, helping you make informed inventory management decisions. As such, many retailers automate their inventory management using SKUs — such as automatically reordering products when stock levels drop beneath a certain level. SKU codes can be used in various industries, including retail stores, eCommerce, and manufacturing to keep track of inventory levels, sales performance, pricing, and promotions. Remember, SKU numbers are primarily internal identifiers for your products. However, if your structure is simple and easy to follow, you may gain adoption by other sales channel partners. If you run your e-Commerce website, you should definitely implement SKU numbers to aid your customers and track your inventory.

If you provide products for dealers to sell to their customers using POS software, you need to label your products with your UPC or EAN—identifiers that they also can use. This will help you keep track of your inventory and make it easier for customers to find the products they’re looking for. If you sell products online, then you know how important it is to have good product descriptions.