SKU Vs. UPC: What is the Difference?

Wondering what the difference between an SKU and a UPC is? Explore the differences between SKUs and UPCs and explain when each should be used.

SKU Vs. UPC: What is the Difference?

SKU is an abbreviation for Stock Keeping Unit, which has a unique alphanumeric code. This code is assigned to each product of a company. With the help of this code, businesses can track the units sold in the inventory. On the other hand, the UPCs are known as Universal Product Codes. It is a 12-digit licensed code provided by the manufacturer from GS1 US. 

The vast difference between these two codes is that the SKU codes are for internal use while the UPCs are for external use. The businesses need to understand the differences between these codes and the SKU vs. UPC for the optimized inventory management system.

What Is An SKU Number?

An SKU number is a unique identifier for a product. It stands for stock keeping unit, and it's used by businesses to track products.

When you buy something from a store, the cashier will usually scan the barcode on the product to enter it into the store's inventory system. The barcode contains the SKU number for that product. This number helps businesses keep track of how much of each product they have in stock, and it also allows them to track sales data for each product.

Related: How To Make SKUs For Products?

What is a UPC Number?

 A UPC (Universal Product Code) number is a barcode used to identify a product for retail sale. The UPC number consists of a 12-digit code that uniquely identifies a product. It is often placed on the product packaging but can also be found on the product itself.

Retailers use the UPC number to scan and track products as they are being sold. It also helps with inventory management and price control. In addition, You can use the UPC number to trace defective products back to their manufacturers. 

How Are SKU Numbers And UPC Numbers Different From Each Other?

The difference between UPC and SKU is based on different factors and features. Below are the factors for differentiating them.

Code Types - UPC vs. product code

The SKUs are alphanumeric codes combined with letters and numbers of any length, while UPCs include only numbers limited to 12 digits. This is the difference between UPC barcode vs. SKU.

Permanence

SKUs can be easily changeable as the business itself generates them. While naming conventions for SKUs, you can easily remove, add, or modify the codes in your catalog as long as it remains consistent. On the other hand, UPCs cannot be changed. It is permanent once created and assigned to the product. Moreover, you cannot modify it easily. Adding the code based on the company prefix planned for signing up is difficult. 

Way Of Usage 

SKUs are only for internal usage for various processes such as tracking, inventory management, and organizational purposes. It is meant for the business it is created for and doesn't mean anything to other companies.

The UPCs are best for external use, which is universally recognized and permanent. It ensures your ownership and allows for a standardized tracking of the goods when it passes through multiple hands before reaching the customers.

Which One Should You Use For Your Business - SKU or UPC Numbers?

The answer to this question depends on various factors, including the type of products you sell and the size of your inventory. If you sell frequently updated or changed products, then SKU numbers may be a better option since they can be easily updated. However, if you have a large inventory of products that rarely changes, then UPC numbers may be a better choice since they're permanent and universally recognized. Ultimately, the decision of which type of code to use is up to you and will depend on the specific needs of your business.

Examples of businesses that use SKU and UPC numbers

SKUs are utilized by e-commerce vendors, stores, warehouses, service providers, and product fulfillment centers. While the UPCs are used for selling products on Amazon and Walmart.

Pros And Cons Of Using SKU vs. UPC Numbers

Pros Of SKU

- SKUs help in the quick tracking of products.

- It reduces errors during the product warehousing and shipping process.

- It helps to optimize your management of the catalogs.

- You will be aided in inventory tracking, management, and sales analysis.

- It also saves the cost of raw material and packing material.

- It is helpful in product planning and sales forecasting.

Cons Of SKUs 

- It may run out of physical space in storage centers, 

- You may face difficulty working with stock.

- Expensive charges for tracking, finding, and shipping stock

- It ties up capital in obsolete stock.

- You will also face tax issues related to extra inventory.

Pros Of UPCs

- You can quickly identify a product with barcode scanners.

- You will also know its associated price while scanning

- These codes improve processing speed. 

- It also accelerates efficiency and productivity.

Cons Of UPCs

- UPCs require well-printed codes.

- You need to apply and go through a long process for it.

Conclusion

SKUs and UPCs are essential identifiers for products, but they serve different purposes. Businesses use SKUs internally to track inventory and UPCs externally by customers to identify products. If you need help with picking, packing, and shipping, get in touch with us today. We would be happy to help!

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