Stock Keeping Unit (SKU)

A SKU (Stock Keeping Unit) or product code is a unique number that refers to one specific product.

You can assemble your own SKU, but it's essential to have a certain logic behind your product codes. It's perfectly possible to handle product codes that simply follow one another. So the first product has an SKU of "1", the second "2" and so on. While this is a simple way to generate product codes, it's not the most efficient way to use them.

It's better to have a logical structure that you can expand upon and that is also clear for warehouse staff. This makes it not only easier to read your SKU but also much easier to visualize products based on certain characteristics that are incorporated into the SKU. If, for example, two products with SKUs TW-50-200-G and TW-50-200-R are indicated at a location in the warehouse, then a warehouse staff member will know that he will find two climbing ropes of the same type and length on that location but one red and one green.

The most common practice is to use series where product group, brand, color and size can be recognized within the product code. For example: A blue pair of pants in large size with KLBR0001BLL as product code.

  • 2 letters for the main category = KL (clothing)
  • 2 letters for the subcategory = BR (pants)
  • 4 digits for the product = 0001
  • 2 letters for the color = BL (blue)
  • 1-2 letters for the size = L (large)

Take into account:

  • The possible expansions of your range. If you work with products that have "01", "02", "03", etc., it is very likely that at some point you will run out of product codes to assign to new products. Make sure to add leading zeros in front of each digit, such as 0001, 0002, 0003, etc. In this way, SKUs maintain a uniform form regardless of the growth of the product offer.
  • A uniform structure. Make sure that you keep the structure of your product codes consistent for all products. This makes it easier to recognize and remember them.
  • Length. Try to make your product codes as short as possible. This makes it easier to remember and use them. A product code of 10-15 characters is usually a good length.

Want to know more about product codes? Check out our blog 'The importance of product codes in a warehouse'