SKU is a heading identifier. SKU in trade

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

SKU is a product item identifier used in trade to create and track statistics of goods or services sold. This abbreviation appeared in Russian as a reading of the English designation SKU - stock keeping unit, in translation - "warehouse unit".

Spectrum of meaning

SKU in trade originally denoted a real unit of production - both sold and still stored in a warehouse. Later, with the development of the service sector and the expansion of sales of intangible goods, such as licenses for the use of programs or online training courses, SKU began to be used to indicate any sold items.

In the modern interpretation, this term is also deciphered as an article - a combination of numbers and symbols from which you can get certain information about the characteristics of the product. Any sold item or service receives an individual SKU - this is a code that distinguishes it from all the others. This designation facilitates the calculation of distribution.

Features of SKU assignment

The slightest difference in the characteristics of two similar trade items entails assigning them different identifiers. For example, 1%kefir in a plastic bottle with a volume of 0.5 l and 2.5% in the same container will be given different SKUs to track their movement in the warehouse and display on store shelves.

The identifier can include both numbers under which the product is encrypted, and symbols indicating color, size and other versions of the product. The SKU for clothing, household appliances, furniture, stationery is often formed using a combination of numbers and letters (for example, 123-SIN). In the respective stores, it is convenient to track sales statistics, taking into account colors, sizes and other related characteristics.

SKU in assortment policy

Each accounting unit participates in inventory management in the enterprise. The organization and ordering of deliveries takes place taking into account the movement of each SKU. The main volume of sales is carried out at the expense of only 20% of the total number of positions, but, as trading practice has shown, it makes no sense to refuse all the remaining 80%. Buyers in general prefer to choose future purchases where the largest number of SKUs are represented, and not where only the most popular goods are concentrated. In order to successfully trade, it is necessary to offer the population more quality varieties of products than the average demand requires.

Simultaneously with the increase in the range of offered goods or services, it is necessary to monitor the oversaturation of the market. When a particular company exceeds the required amount of production too much, the least demanded varieties become noticeable, and the range fallsreduce due to unjustified production and storage costs.

When forming the assortment policy, the enterprise must take into account the peculiarities of the ways and channels of distribution of each group of goods. According to the degree of demand and volume of shares in the sale of the product, SKU are divided into:

• main - with consistently high demand and steady sales;
• priority - the most popular, key products of the group;
• extra.

Identifiers are classified into groups using ABC or XYZ analysis.

Retail and storage unit

Retailing in high volumes with a wide range of products cannot do without SKU. This is necessary because in the presence of hundreds and thousands of storage units, control over the receipt and consumption of products passes from the accounting plane to the logistics plane. For each SKU of goods, it is required to count the balances. Quality control over the unsold volume of products and the calculation of the quantity to be ordered provides the key to the rational use of each meter of selling space and increases the overall profitability of the enterprise.

However, in practice, there are difficulties with the correct accounting for the SKU. These are situations when the enterprise has a large number of goods with complex identifiers, for example, Bolt M30 GOST 15589-70 and Bolt M30 GOST 7805-70, there is a risk of confusion between these positions. Erroneous data may appear about the absence of one SKU and an excess of another. ForTo prevent such situations, each enterprise should take care to create its own transparent product coding system, avoiding duplication of designations.