In today’s fast-paced retail environment, efficient product identification and tracking are crucial for businesses to succeed. Two commonly used codes in the retail industry are SKU (Stock Keeping Unit) and UPC (Universal Product Code). While both codes serve similar purposes, there are distinct differences between them. Understanding these differences is essential for retailers, manufacturers, and consumers alike. In this article, we will delve into the intricacies of SKU and UPC and explore what sets them apart. We will discuss their definitions, functions, and applications, enabling you to grasp the significance of SKU and UPC and their roles in the retail landscape.
What is SKU ?
SKU(Stock Keeping Unit) is a unique alphanumeric code. Business assign it to a specific product or item in a retailer’s inventory. It serves as an internal tracking and management tool used to identify and differentiate products from one another within a store or warehouse. Each SKU represents a distinct variation of a product, such as different sizes, colors, or packaging options.
The SKU code typically consists of a combination of letters, numbers, or both, created by the retailer or manufacturer. It allows for easy and efficient inventory management, pricing, and tracking of sales. Retailers often use SKUs to monitor stock levels, reorder products, and analyze sales performance on an individual product basis.
SKUs offer flexibility, as retailers have the freedom to create their own SKU system based on their specific needs. This allows them to customize the codes to align with their internal processes, product categories, or organizational structure.
Having accurate and well-organized SKU data is crucial for efficient inventory management, order fulfillment, and overall business operations.
What is UPC ?
UPC (Universal Product Code) is a standardized barcode system widely used in the retail industry to uniquely identify products. It consists of a series of black vertical bars and numbers printed on a product’s packaging. The UPC barcode can be scanned by point-of-sale (POS) systems or handheld scanners to quickly and accurately retrieve product information during the checkout process.
Each UPC consists of two main components: the manufacturer prefix and the product number. The GS1 organization assign the manufacturer prefix, a global standards body responsible for managing product identification standards. The manufacturer unique to each product and assign the product number.
When they scan a product at the point of sale, It decodes to retrieve information such as the product name, price, and other relevant details. This allows for accurate and efficient inventory management, sales tracking, and pricing updates.
UPC codes are not typically used for internal inventory management within a retailer’s system. Instead, they serve as a standardized identifier that facilitates communication and data exchange between manufacturers, retailers, and other supply chain partners. By using UPC codes, retailers can easily track sales, monitor inventory levels, and reorder products from suppliers.
Overall, the UPC system plays a vital role in improving operational efficiency, ensuring product traceability, and enhancing the overall shopping experience for consumers
The difference between SKU and UPC
SKU and UPC are both codes in the retail industry to identify and track products, but they serve different purposes.
SKU (Stock Keeping Unit)
Retailers or manufacturers assign a unique alphanumeric code to identify a particular product or item. SKU codes are often internal to the company and can vary in format, length, and structure. They can include various information such as product attributes, style, size, color, and other distinguishing characteristics. Business primarily use SKU for internal tracking, stock control, and managing inventory levels.
UPC (Universal Product Code)
On the other hand, is a standardized barcode symbology widely used for product identification and tracking in the global retail industry. The GS1 organization globally recognize and regulate UPC codes. A UPC is a 12-digit numeric code that consists of a company prefix, a product number, and a check digit. The barcode representation of the UPC is typically printed on product packaging, allowing it to be scanned at the point of sale. UPC codes enable efficient and accurate product identification at the checkout counter, inventory management, and supply chain operations.
| SKU | UPC |
| Alphanumeric (numbers and letters) | Numeric |
| Any length (typically 8-10) | 12 digits |
| Created by the business that designed the product | Must be purchased from the GS1 |
| Specific to each business | Universally recognizable |
| Internal use (shelves and tags) | External use (universal identifier) |
| Physical products and services | Physical products only |
SKU vs UPC : Which one do you need?
The choice between SKU (Stock Keeping Unit) and UPC (Universal Product Code) depends on the specific context and purpose for which you need them.
SKU
A SKU is a unique identifier assigned by a retailer or seller to a specific product or item. It’s purposes are manage internal inventory . SKUs can vary across different retailers or businesses, and they are often alphanumeric codes that provide detailed information about the product, such as color, size, style, and other attributes. SKUs are useful for tracking inventory levels, managing stock, and facilitating efficient order fulfillment within a particular organization.
UPC
A UPC is a standardized barcode system. Business use to identify products at the point of sale. It consists of a barcode and a corresponding numerical code. UPCs are globally recognized and enable quick and accurate product identification during retail transactions. They are typically obtained from the Uniform Code Council (GS1 US) and are commonly used in supermarkets, retail stores, and online marketplaces. Selling products require UPC codes through many retail channels, and they help streamline the checkout process, maintain accurate pricing, and manage inventory across different retailers.
In summary, if you are managing your own inventory and need a unique identifier for internal purposes, a SKU would be more appropriate. However, if you are selling products through retail channels and need a standardized barcode for point-of-sale transactions and inventory management across different retailers, a UPC is necessary.
