Inventory management is a tough task, so knowing the difference between SKU and UPC may help you. Both assist businesses in organizing and monitoring inventory. This blog explains the key differences between SKU and UPC codes that businesses should learn in time.

Description of SKU

SKU stands for Stock Keeping Units. These are codes that businesses may use for monitoring product inventory and sales. SKUs are used by companies for internal operations, and the SKUs that a company allocates to its items are specific to that company. Enterprises can employ SKUs to keep records of billed services such as units of repair time.

Description of UPC

As per international standards, UPC is a code specified for unique products by the same manufacturer. Retailers employ the same UPCs corresponding to the particular product. To understand better, consider the example of chocolates. Many brands manufacture chocolates in the same sizes, shapes, and flavors. Each chocolate of the same size, shape, and flavor from a similar brand will have the same UPC irrespective of the retailer details.

UPCs are applicable to products that contribute to the retail supply chain, and international sales are intended. So, UPCs are required for international sales and not the local ones.

Differences between SKU & UPC

1.   Code Source

As told earlier, enterprises need SKUs for internal operations. So, they apply these codes after aligning the inventory management system (IMS) as per the requirements.

UPCs are created by GS1 with the collaboration of manufacturers. The manufacturers must buy UPCs from GS1 if they intend to sell the items through retailers or internationally. Enterprises are unable to provide their own UPCs to their items throughout this procedure. All UPCs are assigned by the GS1 to assure that each registered product is coded uniquely.

2.   Codes length and formatting

The formatting of SKU and UPC also differs. UPCs have fixed character lengths i.e. twelve digits (numbers) while SKU code lengths vary and include both numerical and alphabetical digits. On average, the length of SKU codes is 8 to 12 characters. Some SKU codes may extend to forty characters in length based on the IMS of a company.

3.   Purpose

Both an SKU and a UPC serve distinct purposes. SKUs are used for internal IM, whereas UPCs are used to track inventory distribution to retailers. SKUs are applicable to any billable services, but UPCs are only applicable to physical products.

Take Away!

The differences between SKU and UPC are clear. If UPC suits your IMS, then buy them from GS1. If you need SKUs for the IMS, then look for the sellers to buy enough.