What is SKU (Stock Keeping Unit)?
Nexa Consultancy | Startup & Finance Glossary
A Stock Keeping Unit (SKU) is a unique alphanumeric code assigned to each distinct product and service that a company sells. It is used to identify and track inventory items. SKUs are different from universal product codes (UPCs) as they are internal to a specific company.
For Startups: For D2C and e-commerce startups, an effective SKU system is the foundation of efficient inventory management. It allows for accurate tracking of stock levels, sales performance, and profitability for each product variant (e.g., a T-shirt in different sizes and colors will each have a unique SKU).
Example: A shoe company might use the SKU "NK-AJ1-RED-10" to represent a Nike Air Jordan 1 shoe, in red, size 10. This allows for precise tracking of that specific item in their inventory system.