Effective SKU Naming for Warehouse Management

Optimising SKU Codes for Warehouse Efficiency


Designing a good naming convention for your warehouses’ SKUs is essential for efficient inventory management.

The Benefit
A good SKU naming convention enhances inventory management, reduces errors, streamlines operations, supports scalability, and improves customer service through consistent and efficient product identification.

Core SKU Design Principles

Consistency: Ensure that the naming convention is applied consistently across all products.
Simplicity: Keep it simple and avoid special characters or spaces. Use only alphanumeric characters.
Descriptive: Make the SKUs descriptive enough to provide essential information about the product.

SKU Structure and Scalability

Length: Keep the SKUs short but informative. Typically, 8-12 characters is ideal.
Scalability: Design the system to accommodate future products and variations.
Category Code: Use 2-3 letters to represent the product category (e.g., "ELE" for electronics).

SKU Components

Category Code: Use 2-3 letters to represent the product category (e.g., “ELE” for electronics).
Sub-category Code: Use another 2-3 letters for sub-categories if necessary (e.g., “PH” for phones).
Product Identifier: Use 3-4 digits/letters to uniquely identify the product (e.g., model number or a unique sequence).
Variant Code: Use 1-2 characters to indicate product variants like size, colour, or material (e.g., “BL” for black, “LG” for large).

Example Structure

Format: [Category]-[Sub-category]-[Product ID]-[Variant]
Example: ELE-PH-1234-BL (Electronics, Phone, Model 1234, Black)

Steps to Implement

Define Categories and Sub-categories: List all product categories and sub-categories.
Create a Unique Product Identifier: Assign a unique identifier for each product.
Specify Variant Codes: Define codes for common variants.
Document the Convention: Create a reference document for your team to ensure consistency.
Integrate with Inventory System: Ensure the SKU format is compatible with your ERP and warehouse management systems.
By following these guidelines, you can create a robust SKU naming convention that enhances inventory tracking and management.