A unique identifier for a specific product or pallet type in inventory.
Detailed Definition
A stock keeping unit (SKU) is an internal code a business assigns to each distinct item it stocks, so every size, color, pack or pallet type it tracks has its own record for quantity, location and reorder point. SKUs are set by each company and differ from a UPC or other GS1 number, which identifies a product the same way across all trading partners. A pallet user might give separate SKUs to new 48 x 40 pallets, recycled grade B pallets and heat-treated export pallets so each is counted and reordered on its own.
SKU vs UPC vs SSCC
A SKU is your own internal code and can follow any format you choose. A UPC or GTIN is a GS1 number printed as a barcode so retailers and distributors all identify the same product the same way. An SSCC identifies one specific shipping unit, such as a single pallet load, and is usually printed on a GS1-128 label. One SKU may map to one GTIN, while thousands of pallets of that SKU each carry their own SSCC.
How SKU counts shape the warehouse
The number of SKUs and how fast each one moves drive storage and picking design. A few fast SKUs with many pallets each suit dense storage and full-pallet picking. Many slow SKUs with a pallet or less each need selective rack, shelving and more case or split-case picking. Reviewing SKU velocity regularly helps decide which items deserve the most accessible pick faces.
Setting up SKUs for pallets themselves
- Separate SKUs for each footprint, such as 48 x 40 and 42 x 42.
- Separate new, recycled and grade variants.
- Separate heat-treated export pallets from untreated ones.
- Keep pooled rental pallets out of owned-asset SKUs, since you do not own them.
Related Glossary Terms
Frequently Asked Questions
Can two companies use the same SKU for one product?
They can, but it would be a coincidence, because each company builds its own SKU scheme. A manufacturer, a distributor and a retailer often each have a different SKU for the same item. That is why trading partners exchange GS1 identifiers such as GTINs, and why item master data in EDI and purchase orders usually lists both the buyer's item number and the supplier's item number.
How should a pallet with several SKUs be labeled?
Mixed pallets are usually identified by a single SSCC on a GS1-128 shipping label, with the contents listed in the advance ship notice so the receiver knows which SKUs and quantities are on the pallet. Many retailer routing guides set specific rules for mixed pallets, such as label placement, building one SKU per layer, or marking the pallet as mixed. Check the receiver's guide before building mixed loads.