Stock keeping unit (SKU)
Short definition
A stock keeping unit (SKU) is the unique code a business uses to tell each product variation apart.
The same product in a different colour, size or bundle gets its own SKU, so stock, order and sales data are tracked at variation level rather than product level. Using the same SKU on a marketplace and on a business's own site keeps inventory consistent across both channels.
SKU naming usually packs category, model and variation information into a short code; without a consistent rule, the same product ends up known by different codes in different systems and stock counts get confused.
In multichannel selling, each channel can have its own product identifier; the SKU is the common reference point that ties those different identifiers back to one internal record.
Why it matters
Without a SKU, which variation is in stock and which has sold out cannot be tracked reliably. For a business selling across more than one channel, it is the basic tool that prevents stock errors. Without it, taking an order for a variation that has already sold out, and cancelling it afterwards, becomes a routine problem.
