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What Does SKU Stand for on Shopify? + How To Use It Correctly

What does sku stand for
Published 3 December 2022

If you’ve set up a Shopify store, you’ve probably come across the term “SKU” and wondered what it meant. So, what does SKU stand for on Shopify? 

SKU stands for Stock Keeping Unit. Each product on most eCommerce platforms has an SKU or exclusive code for easy identification, tracking, and management.

This article will take a closer look at the definition of SKU and why every product needs a unique SKU number. Keep reading to learn more.

Shopify sku

SKU stands for Stock Keeping Unit

SKU is an exclusive identifier for every product in your store. The identifier is a reference number to track the product’s location and inventory level.

For example, each item must have its own SKU in a clothing store. This helps the retailer track and manage stock levels. Besides, it also allows customers to search for products quickly and easily. 

Every product needs a unique SKU for easy identification

Many store owners don’t always realize the importance of having a unique SKU for each product in their inventory. This can result in mistakes when managing inventory levels, leading to inaccurate order fulfilment and even lost sales.

According to Shopify, choosing a unique SKU for each product is crucial, as this will help you track your inventory levels accurately and much more. In addition, it’s also useful if you need to make any changes or updates later on. For example, your supplier may ask you for the SKU when sending out an updated product version.

Key Takeaway: Every product needs a unique SKU because it helps identify specific product variants within your inventory. If you have two very similar products (e.g., two different sizes of the same shirt), having separate SKUs for each will allow you to track their inventory levels accurately. Think of it like a barcode but in text.

The features of an SKU

An SKU typically consists of a combination of numbers and letters, though sometimes it can be only letters or numbers. They include identifiers about many product features, such as: 

  • Color
  • Size
  • Style
  • Type

There are several common features that all SKUs should have. These include:

  • Product name or description 
  • Manufacturer part number 
  • Country of origin 
  • Batch or lot number 
  • Expiration date (for perishable goods) 

Some other features that may be included are the product’s price, weight, or dimensions.

Here’s a video that may come in handy if you need more information on SKUs and how to manage them in your Shopify store:

The importance of an SKU

There are several key benefits of using SKUs to manage your inventory. Let’s explore these benefits below: 

Accurate tracking and management of inventory

SKUs will ensure you have the right amount of stock so your customers are never disappointed with out-of-stock items. 

Additionally, using SKUs can help you identify slow-moving or poor-selling products. This allows you to consider discontinuing those items to free up inventory space for more popular products.

Easier order fulfilment & shipping

Another advantage of SKUs is that they help you efficiently fill orders and ship products to your customers. 

For example, SKUs help you identify products that need to be shipped together or separately. This makes it easier to package and ship orders efficiently, saving time and reducing costs.

Easier identification of products 

If you need to look up information about a product in your inventory, then using SKUs can simplify this process. This is especially true if you have many products in your store, as it can be challenging to find a specific item without an SKU.

For example, if you need to look up a product’s exact dimensions or weight, having the SKU saves you from searching through your entire inventory database to find this information. Additionally, you can answer customer queries more quickly and easily.

It can also help avoid human error because it’s easy to get mixed up with variants.

Key Takeaway: Having unique SKUs for each product streamlines your order fulfilment process by making it easier to identify the specific product that needs to be shipped. This, in turn, leads to fewer errors and happier customers.

In addition, having accurate SKUs can help you avoid overstocking or understocking certain products, saving you money in the long run. 

Conclusion

Using SKUs can streamline various aspects of your inventory management and order fulfilment process. Whether you’re tracking inventory levels, fulfilling orders, or looking up product information, having unique SKUs for each product can make all these tasks easier.

Additionally, this approach can improve customer satisfaction by ensuring that orders are accurately fulfilled and that customers can quickly look up product information. If you’re looking for an effective way to manage your inventory, consider implementing SKUs into your business operations today.

About Author

Will is a professional Ecommerce Shopify expert (7 years experience) & a professional Filmmaker/Video Editor (17 years experience). Now living between the Isle of Man & Brighton, UK. Highly experienced in Premiere Pro, DaVinci Resolve, After Effects, Shopify, WordPress & SEO. Owner of Teckers, Bounce Color, Stunt Camera Crew & more.

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