# SKU (Stock Keeping Unit)


A SKU (Stock Keeping Unit) is a seller's internal code for a distinct product variant, used to track inventory and fulfill orders. Unlike a GTIN, which is globally unique, a SKU is defined by each company, so the same item can have different SKUs at the buyer and the supplier. Mapping between them is essential.

## SKU versus GTIN

A SKU is internal and seller-defined; a GTIN is global and standardized. A retailer's SKU, a distributor's SKU, and the manufacturer's GTIN can all point to the same physical item, which is why orders need a cross-reference to match lines correctly across partners.

## SKUs in order matching

When an order arrives with the buyer's part number, the supplier's system has to map it to its own SKU. A missing or wrong mapping fails the line and stalls the order. Maintaining a customer-item cross-reference is what makes automated order matching work.

## SKU vs UPC vs GTIN

A SKU is one company's internal code. UPCs and other GTINs are global identifiers issued through GS1.

| Code | Who assigns it | Unique across | Format |
| --- | --- | --- | --- |
| SKU | Each seller | One company | Letters and numbers, any length |
| UPC (GTIN-12) | Brand owner, via a GS1 company prefix | The world | 12 digits, e.g. 012345678905 |
| EAN (GTIN-13) | Brand owner, via a GS1 company prefix | The world | 13 digits |
| GTIN-14 | Brand owner, via a GS1 company prefix | The world | 14 digits for cases and pallets |

## How to build a SKU

A good SKU is readable at a glance. A common pattern strings together category, product, and variant, such as OLV-EVOO-500-12 for extra virgin olive oil, 500 ml, case of 12.

- Start with letters, not a zero. Spreadsheets strip leading zeros.
- Avoid characters that look alike, such as O and 0 or I and 1.
- Keep it short enough to read aloud and key in, around 8 to 12 characters.
- Do not encode price or supplier. Both change and the SKU should not.
- Never reuse a discontinued SKU for a different product.

## SKU cross-reference example

Each customer may order the same item by its own part number. The cross-reference ties them together so an incoming PO line maps to the right SKU and unit of measure.

| Customer part number | Supplier SKU | GTIN | UOM |
| --- | --- | --- | --- |
| KR-448120 | OLV-EVOO-500-12 | 10012345678902 | CS |
| WF-00917 | OLV-EVOO-500-12 | 10012345678902 | CS |
| Supplier catalog | OLV-EVOO-500-EA | 00012345678905 | EA |

## FAQ

### What does SKU stand for?

SKU stands for Stock Keeping Unit, a company's internal code for a distinct product or variant used to track inventory and fulfill orders.

### What is the difference between a SKU and a UPC?

A SKU is an internal, company-specific code. A UPC is a globally unique barcode number, a form of GTIN. The same item has one UPC but can have different SKUs at each company.

### How many characters should a SKU be?

Most businesses use 8 to 12 characters. Long enough to encode category and variant, short enough to read and type without mistakes.

### Is a SKU the same as an item number?

Usually. Many ERPs call the SKU the item number or part number. What matters is that it is unique within your company.

## Sources

- [GS1 US standards](https://www.gs1us.org)