SKU Meaning: Here’s What It Means and How to Use It

Do you know the meaning of SKU? Worry not — we’re here to help! Read on as we explore the acronym SKU to uncover its definition and more.

Your writing, at its best

Compose bold, clear, mistake-free, writing with Grammarly's AI-powered writing assistant

In the great wide world of retail-related acronyms, SKU is likely one you’ve come across many times, but do you know what it means? Don’t worry, we’ll tell you!

In this post, we’re exploring the acronym SKU to uncover what it stands for, its meaning, and how it’s used. Are you ready? Let’s dive in.  

What Does SKU Stand For?

If you ask the folks over at Cambridge English Dictionary, SKU is an abbreviation for stock-keeping unit. It can also be defined more in-depth as a set or single number given to a product to show which particular product it is. 

In layman’s terms, a SKU (pronounced “skyo͝o”) stands for stock-keeping unit, and a retailer will use SKUs to identify their business’s inventory. 

The acronym SKU first appeared in 1974, also defined as “stock-keeping unit.” Typically speaking, SKUs are printed along with a barcode.

Usage Examples of SKU

By now, in the world of online order and retail-related acronyms, surely you have heard SKU well over a million times. As the name suggests, you may have known it’s a number — but how do we use this number correctly?

Using SKU in a sentence is a great way to memorize its definitions, and it also shows the different contexts in which we can use SKU in the English language. 

Below you will find many examples of the usage of SKU:

We have identified detailed information on what has been counted at both the attribute and SKU levels.

Were you aware that each item can have several individual suppliers complete with their own unique SKU numbers and negotiated discounts?

If you already have a t-shirt in mind, you can input the SKU to find it in a snap.

You can either go through snail mail and fill out the mailing form on their catalog, or you can go to their online site and put in the SKU to order right away. 

I can not believe we started with only two designs; now we have well over 40 SKUs for a single design and multiple warehouses.

For your convenience, we have added a quick order feature to our online retail store; just plug in the SKU number, insert the quantity and order the item in no time flat.

UPC Codes and SKUs

These two acronyms or terms are often used interchangeably. As similar as they may be, they both have unique purposes for online and in-store retailers. 

Universal product code or UPC refers to the 12-digit numeric code attached to a product whenever it is sold. A UPC is for external use.

Pro Tip: You may sometimes hear people mistakenly say “UPC code,” which would awkwardly translate to universal product code. So, spread this newfound knowledge to help others avoid this redundant faux pas. 

In short, a product will always have the same UPC, regardless of where the item is sold. However, each store may assign it a different SKU. SKUs are typically unique from retailer to retailer. 

At the end of the day, many retailers use UPCs as SKUs, but those that make their own products tend to find it beneficial to create their own SKU system.

If you do create your own SKU management system, you will need to calculate two metrics: sales ratio and SKU ratio. Afterward, you will need to compare the two. 

Alternate Retail Related Acronyms

Acronyms and abbreviations are more commonplace than the words they represent as we move into our digital age. 

Now, most of us may have had our humble beginnings on AOL Instant Messenger —and we’re sure most do not have time to keep up with the ever-expanding list of retail abbreviations

Fret not, with our list of the most common and popularly used retail-related acronyms; you, too, will be using them all like a licensed professional in no time:

  • 3PL – third-party logistics
  • AOV – average order value
  • DC – distribution center
  • API – application programming interface
  • AR – augmented reality
  • CAC – customer acquisition cost
  • CLTV – customer lifetime value 
  • LBO – leveraged buyout
  • LIFO – last in, first out
  • CMS – content management system
  • EDLP – everyday low pricing
  • CRM – customer relationship management software 
  • CRO – conversion rate optimization
  • CSV – comma-separated values
  • CTA – call to action
  • FIFO – first in, first out
  • ATS – average transaction size
  • CoF – card on file
  • CTR – click-through rate
  • CX – customer experience 
  • GST – goods and services tax
  • DDP – delivery duty paid
  • DDU – delivery duty unpaid
  • ATV – average transaction value
  • EDI – electronic data interchange
  • ERP – enterprise resource planning software
  • KPI – key performance indicator
  • NPS – net promoter score
  • VAT – value-added tax


SKUs are codes used to identify inventory, and they can track inventory management, sales trends, and other analysis. Each item type will have its own SKU, specialized down to the size, style, and even color of the product. These are distinct from UPCs because SKUs are not standardized across sotres.

Just remember, for all you business owners out there, SKUs are not a one-size-fits-all sort of architecture; the more you tailor your SKUs to you and your customers’ needs, the more you can help your business succeed.


  1. Stock Keeping Unit (SKU) Definition | Investopedia 
  2. SKU | definition | the Cambridge English Dictionary
  3. SKU | Definition, Meaning, & Facts | Britannica