Post on Wednesday, December 6th, 2017 in Accounting
A stock keeping unit (SKU) is a unique alphanumeric code that the supplier assigns to each product, thus making it easy to distinguish this product from others.
Unlike bar codes, SKUs are used internally, not externally. Besides, they are human-readable and do not have such strict standards as bar codes.
A SKU number may look like this: TS-Cot-Bk-36. At first, it may seem to be a random, meaningless array of letters and numbers, but if we decipher the SKU meaning, it will be possible to see “T-Shirt, Cotton, Black, Size 36.” This example gives a better understanding of what an SKU number is.
Creating SKU numbers is one of the most important prerequisites of your inventory management. Without SKU numbers, your system will not function properly, so it is crucial to know how to create SKU numbers and manage them.
Here are some real-life examples of how a product would convert to an SKU number, just to give you a better idea of what to look for.
As an integral part of inventory management, SKUs are useful for a number of reasons:
With a SKU code, it is way easier to search for inventory items and track their movements. You will see it yourself after you start using SKUs in your inventory management.
SKU numbers can be contained in barcodes, and barcoding tools eliminate human errors that may occur when entering the data manually.
With an SKU number, it is possible to get the needed information about a specific product within seconds.
SKU inventory codes help you make sure that the warehouse employees do not pick or ship the wrong items.
If you store the same products in different locations, you can assign different SKU inventory numbers to these items for more efficient inventory management. Some inventory management services also have the option to implement multiple-location management of the same SKU as a feature, if you’re looking for an alternative to assigning different SKU numbers.
It is much more difficult to steal an item with a unique number, even if it is a small item among lots of other items inside a big warehouse. SKUs allow you to track and organize your inventory so you know where everything is at all times. You can track movement and location, so if something is missing you will immediately know about it. You will also have a unique number that identifies exactly which product is missing. More oversight brings less theft.
For each SKU, you can specify the reorder point and safety stock value, with which you can control your inventory amounts and be aware of when you should replenish it.
Dynamic Inventory software is the best tool for SKU inventory management. Our system is easy to use and allows you to create and manage your SKUs quickly and painlessly. Contact us today to get more information or schedule a personal demo. We’d be happy to help you improve your inventory management procedures and make them as streamlined as possible.
Learn how Dynamic Inventory can streamline your business today!Schedule a Demo
Tuesday, December 11th, 2018
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