What is a SKU? Meaning, examples, and how to create SKU numbers
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A SKU (stock keeping unit) is a code a seller assigns to each distinct product it stocks, so the team can track that item through receiving, storage, sales, and returns. You create your own SKUs, which means two sellers can stock the same product under completely different SKU numbers. Most people pronounce it “skew.”
This guide covers what a SKU number means, what good SKUs look like, how they differ from UPCs, barcodes, and ASINs, and a six-step method for creating SKU numbers for your inventory. If you already run a SKU system and it’s starting to break as you grow, our guide to organizing and managing SKUs at scale picks up where this one ends.
What does SKU mean?
SKU stands for stock-keeping unit. Each SKU represents one sellable version of a product. A T-shirt that comes in three colors and four sizes is one product with 12 SKUs, because your warehouse team needs to count, pick, and reorder each combination separately.
A SKU number is the code itself. Despite the name, most SKU numbers mix letters and numbers, because letters let people read a product’s attributes at a glance. Sellers use SKUs to:
- Count stock accurately and see when an item needs reordering
- Pick and pack the right variant for each order
- Match the same product across every channel they sell on
- Report on sales, margin, and returns at the product level
Because SKUs sit at the center of all four jobs, they’re the foundation of any inventory management software. Every stock count, order, and listing in the system ties back to a SKU.
What does a SKU number look like?
A SKU number is usually a short string of codes separated by hyphens, with each segment standing for one attribute. Here are three SKU number examples using made-up products.
| Product | SKU | How to read it |
|---|---|---|
| Northfield Outdoor trail jacket, green, size medium | NFO-JKT-104-GRN-M | Brand (NFO), category (JKT for jackets), product number (104), color (GRN), size (M) |
| Harbor Home ceramic mug, 12 oz, blue, set of 4 | HBH-MUG-012-BLU-4PK | Brand (HBH), category (MUG), capacity (012 for 12 oz), color (BLU), pack size (4PK) |
| Ridgeline Moto rear brake pads for a 2019 model | RLM-BRP-R-2019 | Brand (RLM), part type (BRP for brake pads), position (R for rear), model year (2019) |
Anyone who knows the code lists can read these SKUs without opening a product record. That’s the main reason sellers build meaning into their SKUs instead of using random strings.
SKU vs. UPC, barcode, ASIN, and item number
Sellers often mix up SKUs with other product identifiers. The key difference is who creates the code and who it’s for.
| Identifier | Who creates it | What it’s for |
|---|---|---|
| SKU | You, the seller | Internal tracking of each product variant. Format is up to you. |
| UPC or EAN | The manufacturer, using a company prefix licensed from GS1 | A global product number that stays the same no matter who sells the item. UPCs are 12 digits and numeric only. |
| Barcode | Whoever prints the label | A machine-readable image of a code. A barcode can encode a UPC, an EAN, or your own SKU. |
| ASIN | Amazon | Amazon’s 10-character catalog number for a product page. Many sellers can sell against one ASIN, each with their own SKU. |
| Lot or batch number | The manufacturer | Identifies a production run, which matters for expiry dates and recalls. |
Most sellers need several of these at once. You might sell a product with a manufacturer’s UPC on the box, list it on Amazon under an ASIN, track it internally by SKU, and record its batch for recalls. Our guides explain what an ASIN number is and how to read a lot number if you need the details on either.
Why SKUs matter for growing sellers
Channels expect them. Amazon, eBay, Shopify, and Walmart all have a SKU field on every listing. On Amazon, if you leave it blank, Amazon generates a random string for you, which makes that listing much harder to match to your own stock records later.
They speed up the warehouse. When a picker reads NFO-JKT-104-GRN-M on a pick list, they know the brand, item, color, and size before they reach the shelf. Clear SKUs cut the time your team spends checking product records and reduce mispicks between similar variants.
They make stock counts reliable. A count is only as good as the identifiers behind it. When every variant has its own SKU, your team can scan or count each one and trust that the numbers in your system match the shelf.
They make reporting possible. SKU-level reports show which variants sell, which sit, and which come back as returns. Without consistent SKUs, sellers end up merging spreadsheets by product name and guessing.
How to create SKU numbers in six steps
You can create SKU numbers for your whole catalog in an afternoon if you decide the rules before you start naming products.
1. List the attributes that separate your products
Start with the details that make one item different from another in your catalog, such as brand, category, model, color, size, material, or pack size. Include only attributes that change what your team picks. Color and size usually qualify. Marketing descriptions don’t.
2. Choose a SKU format and fix the order
Decide which attributes go into the SKU and in what order, then apply that order to every product. A common SKU format runs from general to specific:
[brand]-[category]-[product number]-[variant]
Putting the broadest attributes first means SKUs sort into sensible groups in a spreadsheet or inventory system. Whatever order you choose, keep it the same for every product, because a SKU that puts size before color in some places and after it in others becomes hard to read and hard to sort.
3. Build a code list for each attribute
Create a short reference sheet that gives every brand, category, color, and size its own code. Use the same length for each type of code where you can, such as three letters for brands and categories and two or three letters for colors.
| Attribute | Value | Code |
|---|---|---|
| Brand | Northfield Outdoor | NFO |
| Category | Jackets | JKT |
| Color | Green | GRN |
| Color | Navy | NVY |
| Size | Small, medium, large | S, M, L |
Your team will learn the codes quickly, and new staff can read any SKU by checking one sheet.
4. Add a product number to keep every SKU unique
Two products can share a brand, category, and color, so give each base product its own number, such as 101, 102, and 103. Pad the numbers to a fixed length so SKUs sort in order, and don’t start a SKU with a zero, because spreadsheets often strip leading zeros when you import or open a file.
5. Check your format against your channels
Before you name hundreds of products, test a few SKUs on every channel you sell on or plan to add. Amazon caps seller SKUs at 40 characters, and other channels set their own limits and character rules. A format that works everywhere from day one saves you from renaming products later. Sticking to letters, numbers, and hyphens keeps you on the safe side.
6. Document the rules and load your SKUs into one system
Write your format and code lists in a single document and share it with everyone who creates products. Then load your SKUs into your inventory system so stock levels, orders, and listings all point at the same codes. Give one person ownership of the rules, so new product lines follow the format instead of stretching it.
SKU naming convention and best practices
A SKU naming convention is the written set of rules your team follows every time it creates a SKU. Follow these rules to keep your SKU codes readable and compatible with other software.
Do:
- Keep SKUs short. Around 8 to 16 characters is plenty for most catalogs.
- Use hyphens to separate segments so people can read each part.
- Use the same code length for each attribute type.
- Give every variant its own SKU (see product options and variations).
Don’t:
- Use spaces or special characters such as &, *, /, or #, which some systems reject or misread.
- Use letters that look like numbers, such as O and 0 or I and 1, in places where both could appear.
- Include details that change, such as price, supplier, or a promotion. The SKU should stay the same for the life of the product.
- Reuse an old SKU for a new product, which mixes two products’ sales and returns history.
- Use a manufacturer’s UPC or a marketplace ID as your SKU, because those codes belong to someone else and differ by channel.
How to generate SKU numbers automatically
You don’t have to type every SKU by hand. Sellers usually generate SKU numbers in one of three ways.
A spreadsheet formula. If your product list has columns for brand code, category code, product number, color code, and size code, one formula can build every SKU. With those codes in columns A to E, this Excel or Google Sheets formula joins them with hyphens and pads the product number to three digits:
=UPPER(A2&"-"&B2&"-"&TEXT(C2,"000")&"-"&D2&"-"&E2)
Copy it down the column, then check the results for duplicates before you load them anywhere.
Your ecommerce platform. Some platforms generate SKUs for new products and variants. BigCommerce, for example, has an auto-SKU generator for product variants.
Your inventory or warehouse system. Inventory and warehouse management systems can create SKUs from templates as you add products. Linnworks warehouse management (powered by SkuVault) includes SKU generation, so your team can apply one format across the whole catalog.
Whichever method you use, the same rule applies. A generator follows the format you give it, so settle the format first.
SKUs, barcodes, and labels
A SKU becomes much more useful once it’s on a scannable label. Many sellers print their own barcodes that encode the SKU, so the warehouse team can scan items at receiving, picking, and packing instead of typing codes. Those labels work inside your own operation. Products sold through retailers or some marketplaces may still need a GS1-issued UPC or EAN on the packaging.
If you want to set this up, learn how to make your own barcode, then compare options in our roundup of barcode inventory software.
SKUs when you sell on more than one channel
Most growing sellers list on several channels at once. Retailers in the 2026 State of Commerce Ops report sold on an average of 4.15 marketplaces in the UK and 4.25 in the US. Each channel has its own product IDs, and your SKU is the code that ties them all back to one stock pool, so use the same SKU as your seller SKU everywhere you can. Keeping those links accurate takes work. In the same report, 29% of retailers in both the UK and the US pointed to inventory synchronization across channels as a major operational challenge.
Linnworks connects to more than 100 channels through native channel integrations and syncs stock across them in under 10 minutes, so a sale on one channel updates stock everywhere else. Of Linnworks customers, 87% cite inventory accuracy as the number one value they get from the platform.
Channel mapping, bundles, and SKU clean-ups go beyond a starter guide. When you reach that stage, our guide to managing SKUs at scale covers them, and a regular inventory audit keeps the catalog tidy.
Frequently asked questions about SKUs
SKU stands for stock-keeping unit. It’s a code a seller assigns to each distinct product and variant it stocks, used to track inventory, orders, and sales.
A SKU number is the code that identifies one sellable item in your inventory. It usually combines letters and numbers that stand for attributes such as brand, product, color, and size, for example, NFO-JKT-104-GRN-M.
Check the product label, the packing slip, or the product details on the listing. For your own stock, the SKU sits in your inventory system or in the inventory section of each channel’s seller account.
No. A SKU is an identifier you create for internal tracking. A barcode is a scannable image that encodes a code. A barcode can hold a UPC, an EAN, or your own SKU.
Many sellers do. Your SKU tracks the product inside your business. A UPC identifies the product globally, and Amazon, Walmart, and many retailers ask for a UPC or another GS1 code when you list a product, though some categories and brands qualify for exemptions.
Sometimes. Some businesses use the two terms for the same code. In others, an item number identifies the base product and SKUs identify each variant of it, such as each color and size.
Around 8 to 16 characters works for most catalogs. Amazon allows up to 40 characters, but shorter SKUs are easier to read, type, and fit on labels.
They shouldn’t. Each SKU must point to exactly one product variant, or your stock counts and order picking will mix the two items. Different sellers can use the same SKU for different products, because each seller’s SKUs only need to be unique within their own catalog.
Amazon generates a random SKU for the listing. It works, but the code carries no meaning, so matching that listing to your own stock records and other channels takes extra work. Setting your own SKU when you create the listing avoids that.
Many sellers use both, because letter codes make SKUs readable. Sellers with very large catalogs sometimes switch to numeric SKUs, which never run out of combinations but require a lookup to read.
Keep every SKU in sync with Linnworks
A clear SKU system gives your team one code for every product. Linnworks keeps that code, and the stock behind it, accurate across every channel you sell on. See how our inventory management system works, or book a demo to see it with your own catalog.
