What does a Stock Keeping Unit (SKU) represent?

A Stock Keeping Unit (SKU) is specifically designed to serve as a unique identifier for each distinct product within inventory management systems. It is a crucial tool that allows businesses to keep track of inventory levels, sales, and product variations, including size, color, and model. By assigning a unique SKU to each product, organizations can efficiently manage their stock and streamline processes such as ordering and replenishment, as well as analyze sales trends.

The uniqueness of an SKU ensures that each product is easily distinguishable, facilitating better inventory control and reporting, which is essential for effective supply chain management. Thus, the definition of SKU as a unique identifier encapsulates its primary purpose in inventory management and supports the overarching goal of accurately tracking merchandise through different sales channels.