When we have a list of products that we want to sell, we need some identification to recognize them. We need to avoid being confused with another similar product.
At the same time, it helps us manage the number of products we have in our store. UPC and SKU are the identification numbers that differentiate the products.
Key Takeaways
- UPC stands for Universal Product Code, while SKU stands for Stock Keeping Unit.
- UPC is a standardized barcode for identifying products, while SKU is a unique identifier a retailer assigns a product for inventory tracking.
- UPCs are used for scanning products at checkout, while SKUs are used for managing inventory.
UPC vs SKU
UPC is a standardized barcode used to identify products in retail settings and is scanned at the point of sale to register the sale and track inventory. SKUs are unique codes used to track inventory within a retail or warehouse setting and can be made up of letters, numbers, or a combination of both.
UPC is brief for Universal Product Code. It permits a business enterprise to perceive its product among others across the world. GS1 assigns a UPC after you request a UPC to assign your product.
As a wholesaler, you want a UPC to marketplace your product at retail.
SKU or Stock Keeping Unit is an identification code that you give to your products to identify them. An SKU is unique to your company, and the SKU may vary by company. SKUs can also be assigned to intangible items.
The business owner can assign any name they want, but it is human-readable and barcoded, so the computer can track it during billing.
Comparison Table
| Parameters of comparison | UPC | SKU |
|---|---|---|
| Definition | UPC is the Universal Product Code. | SKU is the Stock Keeping Unit. |
| Type | Numeric | Alphanumeric |
| Assigned by | GS1 | Individual owner |
| Code length | 12 digits | It varies (approx 10) |
| Type of products | Physical only. | Physical as well as intangible. |
What is UPC?
The UPC concept originated in 1974. Upc is a unique code that helps wholesalers keep track of their products. A UPC is required when a wholesaler sells its products to retailers directly to end-users.
It also helps customers to differentiate products from different wholesale companies. The UPC number is like the Aadhar card of the products, it remains unique and does not change no matter where the products are sold.
It is preserved throughout the useful life of the product.
The universal product code always consists of only numbers and has twelve digits. GS1 gives you the UPC number, a gs1 prefix consisting of six to nine digits licensed for its products.
You must complete an online application to tell gs1 that you need a universal product code.
When completing the request for your barcode to be issued, you must choose the correct plan out of the box, as there will be no upgrade option once you reach your UPCs limit.
Then you have to issue with a different company prefix. GS1 offers 1 to 100,000 licensed UPCs with your company prefix for its products.
UPCs justify the ownership of a product and tell consumers the origin of the product. It is advisable not to use duplicate UPCs in your inventory to avoid conflicts.
As you deliver your product, the 12-digit numeric code helps keep track of every step that prevents you from getting sidetracked. You need to print the UPCs on your product packaging.
What is SKU?
Storage Keeping Unit or SKU is the identification code for individually marking your products. The decision on these numbers depends solely on the owner of the respective store.
They don’t have rules, but you’d better keep them short. You can create your own rule book. An SKU can contain both an alphabet and a number. The length of the SKUs is not specified, but it is approximately 10 digits.
Assuming these are white canvases, you can mark them as ‘CA-color-size-(manufacture date)’ to determine your SKUs. Where “CA” refers to the first two letters of the canvas.
Also, avoid including the manufacturer’s code on your SKU, as it could be confusing, and the SKU will no longer sync. It could interrupt the whole process.
If it’s too much trouble, you can find a free website to help you maintain your SKUs. Otherwise, you can take the help of inventory management software that will help you manage your SKUs for different types of products.
You can create barcodes for your Skus, which reduces the time it takes to keep your items in stock and can be tracked if required. Barcodes that are already assigned to products are also UPC.
So you can ask your manufacturing department to print your barcode (Skus) alongside the UPCs so you can track your product in-store with your SKU.
If it is not, you can generate a translator that will convert the UPCs to your SKUs, it is easy for you to keep track of them with the SKUs.
Main Differences Between UPC and SKU
- UPC is a universal product code, meaning that it is marked in such a way that it must be identified worldwide, while SKUs are limited to tracking the stock in individual companies.
- UPC only includes numbers, whereas SKU includes alphabet and numbers.
- UPC can only be assigned to physical products, and SKU can be assigned to both physical and intangible products.
- UPC is 12 digits long, and SKU has no specified length, about 10 digits.
- UPC must be assigned by GS1, while individual retailers must assign SKUs.
- https://pubsonline.informs.org/doi/abs/10.1287/mksc.18.3.247
- https://papers.ssrn.com/sol3/papers.cfm?abstract_id=432661
Last Updated : 13 July, 2023
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Chara Yadav holds MBA in Finance. Her goal is to simplify finance-related topics. She has worked in finance for about 25 years. She has held multiple finance and banking classes for business schools and communities. Read more at her bio page.
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