Do you know the ideal number of SKUs to upload on online marketplaces?

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Stock Keeping Units or SKUs are codes that represent products within a seller’s inventory. SKUs are unique for each kind of product. It helps in identifying products and maintaining systematic inventory. SKUs embody distinguishing product attributes. These attributes can be anything from color to size to pattern to brand and any other similar characteristics.

Sellers have the freedom to create these codes themselves. Special algorithms and code generating mechanisms would be a waste because these codes are created to convenience sellers. Just the SKU is supposed to tell what the product is, what it is made of, its size, color and design.

The number of SKUs you prepare will depend on the number of products you sell. But is there a limit on this number? The answer is yes. There is a minimum SKU requirement on every online marketplace. However there is no set maximum.

What is the SKU limit?

When selling online the more variety you have the better are your chances of making sales. If you have only one SKU it could be months before online shoppers notice that you exist. The more SKUs you have the more variety you possesses as an online seller. However, a large number of SKUs could affect you negatively too. For example, having 10,000 SKUs is not very feasible for all product categories, because you will unnecessarily be paying for the storage of large product quantities even if they don’t sell. On the other hand if you happen to be a manufacturer of say phone covers, 10,000 SKUs is something you could manage.

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(There is no maximum SKU limit.)

Is there an ideal no. of SKUs?

There sure is! The ideal number of SKUs depends on your business model and your investment budget. If you specialize in summer clothes, you won’t create SKUs for winter clothes unless you have stock of these. Similarly, when you start out with summer wear, you won’t jump to winter wear until you know there is demand for it and you have the finances to go through with this new category.

The ideal number of SKUs is 50 (max), especially if you are just starting out. 50 SKUs allows you to maintain decent product variety online and in your warehouse.

What should one be careful about? (Tips/Hacks)

  • Short forms

SKUs are short forms for your products. These short forms must be created within 22 characters. When preparing SKUs avoid using special characters (like these – @, #, $, %). Even full stops and colons should be avoided. These symbols make the code complex and prone to errors.

  • SKU Classification

SKUs can be classified into parent SKUs and children SKUs. Parent SKUs represent the main product.

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The children SKUs represent slight variations like size, pattern and even color. It’s up to the seller.

 

What other ecommerce basics would you like to know? Let us know in your comments below.

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9 Comments

  1. Abhishek Saini Reply

    We have 200 SKUs but just 1 or 2 piece of each product in wrist watch category. Is this the right method to sell? else we should keep less SKUs and more stock. If so, please let us know what is the best figure to stock per SKU i.e. 10 pieces of each SKU or something. our target is to keep the dead stock at minimum.

    • Rebecca Menezes Reply

      Hi Abhishek Saini,

      Thanks for the comment.

      The amount of stock you keep depends on how fast your stock moves out. Over time you will recognize that some SKUs move faster than others. In this case, you would keep a greater stock for fast moving SKUs and a smaller stock of slow moving SKUs. If you keep a uniform amount for each piece then there is a possibility that you will be stuck with that inventory and your investment will not be worth it.

  2. Hello Abhishek,

    You can go with 10 Pcs of each SKU if the product value is less. After going through the sale report weekly you can keep adding for each SKU & If higher the value of product the stock should be always limited.

  3. Agnes Reply

    Hey,

    Just to know that what exactly do u count in SKU. Like I have 25 design with varies sizes (S, M,L,XL) and each design has 100 quantity per piece. So please let me what your criteria of minimum design.

    I want to register with myntra, Jabong and voonik.

    Thank you

    • Rebecca Menezes Reply

      Hello Anges,

      It’s the product designs and variations among those that make up your SKUs. For example, you sell pink and blue tops you will use the characteristics/ features of the top to prepare your SKU code. Like the example above women’s pink cotton tank top – TP_105_Pink . TP could mean top, 105 the serial number of the item, the number of products of its kind or the one hundredth and fifth (or simply the fifth) tank top design and Pink represents the colour of the top. For the children SKUs you simply add _S for small, _M for medium and so on. Take a look at this article to understand better (https://indianonlineseller.com/2016/01/what-are-sku-codes-and-how-to-create-them/)

  4. Hello Rebecca,

    Can you please explain about the SKU for Myntra?

    You mentioned 50-80 SKUs for Myntra. So is it like 50-80 separate designs?

    Or

    Lets say

    I have 40 separate designs and each design has child SKU(S, M, L) so will it fulfil the number of SKUs required for Myntra or Jabong?

    • Rebecca Menezes Reply

      Hello Deepti,

      Yes 40 separate designs with the child SKUs you’ve mentioned will fulfill the number of SKUs requested by these marketplaces.

  5. Senthil Venkatrajan Reply

    Hi Rebecca ,

    We deal in Apparels and at present we have about 250000 SKUs and we are rigorously working to take it to 1 Million before this year end. Is it OK???

    • Rebecca Menezes Reply

      Hi there Senthil,

      Thanks for the comment. Well, the more SKUs you have the more attention you will need to pay to:
      – your listing process
      – Stock quantities

      The stock maintenance issues can be solved with the help of an inventory management software. Listings, on the other hand, will be a bit tricky. At the same time, you will need to remove/delist the SKUs that are no longer being sold. For example SKUs of products going out of style.

      Hope this helps.

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