An SKU (Stock Keeping Unit) is a unique code created by your business to identify a specific product variant-such as a particular size, color, or style-allowing you to track it across listings, stock, and sales. In e-commerce, a robust SKU system ensures you always have precise information about what you have in stock, where it is being sold, and the remaining quantity. When selling across multiple marketplaces, SKU management determines whether your inventory records remain accurate or rely merely on estimates.
This guide explains what an SKU is, how to create one correctly, and how to manage SKUs when selling on platforms like Amazon, Flipkart, and Meesho.
What Is a SKU in Ecommerce?
An SKU is an internal code. You create it, and its meaning is specific to your own business. It differs from a UPC or barcode; a UPC is a standardized code assigned to a product so that any store or system can identify it.
This distinction is more significant than it might seem. You cannot alter a UPC-it is printed on the product and remains fixed. An SKU, on the other hand, is entirely under your control; you decide its format, length, and the information it contains. That is why SKUs are so useful: you can structure them so that simply reading the code answers questions like "what product is this?", "what is its size?", and "on which marketplace is it listed?".
Why Selling on Multiple Marketplaces Makes SKU Management Harder?
If you sell on a single platform, a simple SKU system is usually sufficient. The moment you add a second or third marketplace, the complexity increases.
Each marketplace has its own listing format, its own rules for product IDs, and sometimes its own method for generating product codes. Without a shared SKU system linking everything to your original product data, you end up with:
- The same product listed under different codes across various marketplaces
- No easy way to view total stock across all channels simultaneously
- Manual updates required whenever stock levels change anywhere
- A high risk of overselling, as one marketplace is unaware of what has already been sold on another
This is the primary challenge of multi-marketplace inventory management: ensuring a single product is recognized as the same item, regardless of how many places it is listed.
How to Create a SKU for Your Products?
Once you decide what information an SKU should contain, creating it is easy. Here is a practical approach:
- Choose your key identifiers. Common choices include category, brand or product name, color, and size.
- Keep it short yet readable. Excessively long SKUs are difficult to scan quickly, while very short SKUs may omit useful details.
- Use letters and numbers, not special characters. Most marketplace systems do not handle symbols like / or & correctly.
- Avoid starting with a zero. Spreadsheet tools often automatically remove leading zeros, inadvertently corrupting your code.
- Test it on paper first. Try writing out SKUs for five or six actual products before finalizing the format for your entire catalog.
A simple example: For a red cotton T-shirt in size M, the SKU could be something like TSH-COT-RED-M. Anyone on your team can read it and immediately understand what it represents.
SKU Naming Convention: What Makes a Good One
A naming convention is just the rule you follow every time you build a new SKU. The exact structure matters less than consistency - every product should follow the same pattern.
A few things a solid naming convention should do:
- Stay the same whether you add 10 products or 10,000
- Avoid relying on information that changes often, like price
- Make duplicate codes easy to spot and avoid
- Work the same way across every marketplace you sell on
One mistake beginners make is building a convention around something temporary, like a current supplier or a seasonal tag. When that detail changes, every related SKU becomes confusing. Stick to attributes that describe the product itself - category, variant, and size are usually safe choices.
SKU Mapping Across Marketplaces
SKU mapping is the process of linking your internal SKU to the various product IDs generated or required by each marketplace. Think of it as a translation layer: your SKU remains constant, while the mapping informs each platform which listing corresponds to which product. Without mapping, a single product might appear as three unrelated items in your reports-one for each marketplace. With mapping, a sale on any platform updates the stock count for that product across the board.
For sellers managing small catalogs, mapping can begin as a simple reference sheet listing each internal SKU alongside its marketplace-specific ID. As the catalog grows, this sheet serves as the foundation for more automated inventory tracking.
SKU Tracking in Excel
Many beginner and growing sellers manage SKUs in Excel before moving to dedicated software, and that's a reasonable starting point if done carefully.
A basic SKU tracking sheet should include:
- SKU code
- Product name and variant (size, colour)
- Marketplace-specific ID for each channel you sell on
- Current stock count per channel
- Reorder level
Keep one master sheet as the source of truth, and update it on a fixed schedule rather than only when you remember to. The biggest risk with Excel tracking isn't the tool - it's letting the sheet fall out of sync with what's actually happening on each marketplace. A small, consistent update habit (daily or every order batch) prevents most of the overselling problems sellers run into.
Practical SKU Management Tips
- Never reuse a retired SKU for a different product, even after months - old order history will point to the wrong item.
- Separate SKU and UPC fields in your system. Don't let marketplace listing tools treat them as the same thing.
- Review your catalogue regularly, not just when something breaks. A monthly check catches duplicate or inconsistent codes early.
- Document your naming convention somewhere your whole team can see it, especially if more than one person creates listings.
- Group related SKUs under a master SKU when products share packing or shipping steps - this makes order picking faster. For sellers handling their own packing, tools like Barmeto's label cropper let you map related SKUs to one master code so every label for that product prints and shorts together, instead of hunting through separate PDFs by hand.
Common SKU Mistakes to Avoid
- Copying a marketplace-generated ID to use as your internal SKU (which stops working as soon as another sales channel is added)
- Creating SKUs based on information that changes over time (such as current pricing or promotions)
- Allowing different team members to use their own preferred formatting styles
- Failing to conduct audits until a stock discrepancy or problem arises
- Treating SKUs and barcodes as interchangeable during the listing process
Why Does This Matters for Inventory Management?
For online sellers, effective inventory management relies more on SKU accuracy than anything else. Stock counting, reordering decisions, and profit calculations are all linked to the accuracy and consistency of SKUs across various channels. For instance, a seller who tracks SKU-level profitability can accurately identify which products are profitable to restock and which are quietly causing losses-but this is only possible if the underlying SKU data is accurate and organized. For example, Barmeto's 'P&L Tool' works by categorizing a seller's catalog into lists that display profit and loss details at the SKU level; This ensures that the next step-such as raising prices, cutting costs, or removing a product from listings-is based on actual data rather than mere guesswork.
Conclusion
SKU management is not a one-time task but an ongoing process. Establish a proper naming convention from the start, map your SKUs consistently across all the marketplaces where you sell, and review your data regularly instead of waiting for problems to arise. For sellers managing listings simultaneously on platforms like Amazon, Flipkart, and Meesho, this consistency helps keep an expanding catalog organized rather than chaotic.
