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What is a SKU, and how do I make them for my eCommerce store?

January 18, 2020

For new online sellers, SKUs can seem like a mystery. Fortunately, SKUs are easy to understand. If you stumbled on this article while trying to find out SKU number meaning, you've come to the right place. By the end of this article, you will know what SKUs are, and you can start assigning SKU numbers to all the products you sell.

What does SKU stand for?
Knowing about SKU's meaning is vital for the success of online sellers. Let's define SKU to get started.

So, what does SKU mean? It's easy to remember the SKU abbreviation once you know what it means. The SKU acronym stands for stock-keeping units. This is a unique combination of numbers and letters that get assigned to each product. If the product has variations, each of those products also gets its own SKU.

As an online seller, you will create SKUs for the products you sell, so it's good to know the SKU definition.

The reason for assigning SKU numbers is to make life easier. SKUs help warehouse staff locate products quickly and accurately so that the right product gets delivered to the customer. SKUs also help you track products along the supply chain and convey information about the product attributes quickly across departments. It also helps with keeping track of inventory levels.

Choosing SKU names
Now that you know what SKU means, the next step is to assign SKUs to your products. There aren't any strict rules for naming SKUs, but you can use these guidelines to help create the best product SKU numbers for all the products you sell.

It is an excellent idea to establish a standard format when naming SKUs. An SKU typically contains a string of letters and/or numbers that work as a code to designate specific product features and variations.

For example, you might decide that the letter B in an SKU stands for the color blue, and that "color" is always the second piece of the SKU. An example is a pair of women's blue jeans in size 8, which could have an SKU that reads: WM-B-JNS-8.

The same seller might have a men's green sweatshirt in size medium for sale with an SKU that reads: MN-G-SWT-M. In this example, the second piece of the SKU also contains the color, using "G" for green. All products this seller sells should follow the same format and use consistent abbreviations.

You don't have to go wild, thinking about what makes each product unique. Stick to basic product features like department, item type, size, variant, and manufacturer name, for example.

As the seller, you will choose the order of the numbers and letters in the SKU sequence. For example, a Nike blue jacket in size large might have the SKU sequence: NK-J-B-LG. In this example, the seller decided that Nike is always abbreviated to NK, J stands for a jacket, B stands for the color blue, and LG stands for size large.

Again, using a consistent format for all SKUs makes conveying information across departments easier. The seller above used the format: manufacturer name-item type-color-size. Any other products the seller has listed for sale should follow this format.

To make this easier, create a list for what each number or letter stands for in an Excel spreadsheet. To start, you might generate a list of brand names with corresponding abbreviations. For example, you can decide that Nike is NK, Adidas is AD, Puma is PU, and Reebok is RBK. Next, do the same for other product features like department (men's, women's, kid's), product type, color, size, and more, if they apply.

Next, you will use the list of abbreviations you just created to create SKUs for all your products. Like our seller above, decide on a consistent format (ex. manufacturer name-item type-color-size). Each product gets its own SKU that can be entered into inventory management, sales, and warehouse software.

Warehouse staff and other departments should be trained to know the SKU format you have chosen to use. That way, all workers can look at an SKU number and know which product it corresponds to quite easily.

Pro tip: Don't start SKU numbers with "0" since some data software and spreadsheets ignore them altogether. Ex. 0NKJB3 might be incorrectly read as NKJB3.

Naming SKUs is quick and easy
SKU number meaning doesn't have to be complicated. The best SKU names are short and easy to remember. This is not the time to get creative! Save your creativity for your next great sales pitch. When naming SKUS, the simpler and shorter, the better, as in the SKU examples above.

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