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SKU is the unique identifier that helps you differentiate one product or its variant from another.

What is SKU?

SKU stands for stock keeping unit and it's a number that retailers and businesses use to differentiate products and track inventory levels. It’s not enough to have one SKU for a shirt.

Each product variant should have different SKUs to manage. In the case of the shirt, you’d need a unique SKU code for different colors, brands, patterns, and sizes.

SKUs aren’t universal they have unique identification of each of the variants that are present in your inventory. Always it's a number that retailers assign to products to keep track of stock levels internally and easy to understand which items will be out of stock.

Why are SKUs important?

SKU numbers are important because they help you to track your inventory accurately and prevent out-of-stock and also pinpoint when to order new products so your merchandise never goes out of stock.

SKUs also help to collect data on sales. For example, a store can see which items are best selling and which are not based on SKU data.

What Are SKUs Used For?

Analysis: SKU determines product popularity or views seasonal sales trends in their different customer segments for inventory. This analysis helps for more conversion and gives an idea about which item should be always present in stock.

Inventory Management: With the help of SKU the retailers are able to track inventory levels, turnover, and flow. They can set inventory levels and timeframes for the future.

Advertising and Marketing: In the competitive market using SKUs in advertising is a technique of digital marketing. Many retailers and business advertise their SKU number instead of the model number given by the manufacturer.

Product Recommendations: Many companies use SKUs as a upsell to enhance their sales. For example, Shopify is able to pick items to display as "suggestions" when you are purchasing by using SKUs. It helps to more conversion rate as well as more one customer with more than one product that generates more revenue.


SKU and UPC almost look similar but each has different characteristics. SKU is used for internal inventory and UPC is used for the Universal.

SKU code is between 8 to 12 characters but UPC is always 12 characters. SKU is can be alphabetical or Numeric but UPC is always Numeric. SKU is mainly used for identifying product traits and UPC Identifies manufacturer and item.


Q. Is SKU and barcode the same?

Ans. NO, SKU numbers are unique to individual retailers, whereas UPC barcodes are used universally and remain constant for any product that cannot change.

Q. Is an SKU a serial number?

Ans. The serial numbers are not the same as SKUs because they track ownership information of an item but SKUs allow to track each item in stock.