What do sku mean?
SKU stands for Stock Keeping Unit. It is a unique identifier used by businesses to track and manage inventory. An SKU is typically a code made up of numbers, letters, or a combination of both, and it is assigned to each product or item in a store’s inventory to help differentiate between items, monitor stock levels, and streamline the fulfillment process.
Key Points about SKUs:
- Inventory Management: SKUs allow businesses to keep track of product stock, whether it’s in a warehouse, store, or online platform.
- Product Identification: They help identify products based on characteristics like type, size, color, brand, or model, ensuring that similar items are easily distinguishable.
- Sales and Reporting: SKUs are used to track sales performance, order trends, and product demand, helping businesses make informed decisions about restocking and pricing.
- Simplifies Fulfillment: When an order is placed, the SKU is used to quickly locate the product and fulfill the order accurately and efficiently.
Example of an SKU:
For an online boutique selling a red dress, the SKU might look like:
- RD-001-SM
Where: - RD: Stands for the product type, “Red Dress.”
- 001: Represents the product’s unique item number.
- SM: Represents the size, “Small.”
This SKU would help differentiate the red dress from other products, and in case there are other sizes or colors, they would have different SKUs like RD-001-MD (Medium) or RD-002-SM (Blue).
In short, SKUs are crucial for inventory management, order fulfillment, and sales tracking, making it easier for businesses to operate efficiently.