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E-commerce trends
Barcode and SKU: the success actors of your e-commerce!
Julie Ribeiro
December 21, 2023
1. The barcode and SKU guide for high-speed e-commerce!
1.1 SKU and e-commerce barcode: what are they?
SKUs and barcodes are two ways of uniquely identifying a wide range of products that allow for almost perfect traceability, which is necessary in today's world.
- A Stock Keeping Unit (SKU) is a way of uniquely identifying a product within a company.
- A barcode, on the other hand, is often used in retail stores and e-commerce to uniquely identify a product from the moment it leaves the factory until it arrives at the customer's premises.
But what are the specificities and usefulness of these two e-commerce identification codes? Let's have a closer look.
1.2 SKU and Barcode: The identification tools of e-commerce
E-commerce merchants regularly find themselves torn between using SKUs and barcodes for product identification. While these two techniques are similar, they are not the same and can be used together to provide an even more comprehensive and effective way of tracking and uniquely identifying products.
By understanding the differences between SKUs and barcodes and how they can be combined, e-commerce merchants can make the most of these powerful tools to improve their operations and better serve their customers.
1.3 What is a SKU?
An SKU is a unique reference that allows the simple identification of products thanks to a sequence of letters and numbers structured in the same way. This reference is generally used internally and on various inventory management systems.
Some fields such as cosmetics manage their stocks thanks to SKUs and batch numbers. The SKU will then correspond to the product itself (e.g., red nail polish), and the batch number (e.g., manufactured on 25/09) will uniquely identify the product in case of a problem with the item.
Assign your own SKU
You may have noticed that your supplier or manufacturer also uses product identification numbers, such as the UPC, or Universal Product Code. Reusing them can be quite tempting, but we advise you to assign your own SKU to avoid mistakes if one day your suppliers changes this number.
1.4 What are barcodes used for in e-commerce?
Every day, more than 6 billion barcode labels are scanned worldwide… Since it entered the market in 1974, the barcode has become essential in all physical stores to uniquely identify and track each product.
But then, why use them in e-commerce?
The primary purpose of barcodes is the traceability of products in absolutely all sectors. This small, striated code allows us to uniquely identify a product in circulation, whether it is being sold or bought. It is enough that it is scanned to release all the stored information.
For example, let's imagine that you sell red nail polish. Wherever your product is in France, your red nail polish will be recognized and uniquely identified!
2. Benefits of using barcodes in e-commerce logistics
Let's imagine that the sales of your nail polish e-commerce sites explode: you will not be able to store, prepare and send 200 orders by hand, and you will have to outsource your logistics. And, to work with a logistician, you need barcodes!
As an e-commerce business owner, you may find that you need to outsource your logistics when your sales start taking off. To work with a third-party logistics provider, you will need to use barcodes to track your products.
Barcodes allow you to track products, manage the flow of goods remotely, and keep track of your inventory levels in real-time. This eliminates manual counting and ensures that your inventory is always accurate.
There are several types of barcodes that you can use to meet your specific needs. For example, you can use a GS1 128 barcode to manage product batches and include additional information such as expiration dates. By using barcodes, you can make your logistics operations more efficient and effective, allowing you to focus on growing your business.
The barcode is your best ally. It ensures the traceability of your products and reduces human input errors!
2.1 Create a SKU
2.1.1 The letters and numbers of the SKU
When creating your SKU, you can personally choose the letters and numbers that will compose it. But keep in mind that it is a reference that must be logical and simple to understand by humans, especially the members of your team.
It is preferable to avoid 0's and 1's, which can be confused with O's and I's. In the same way, special characters (&, #, @,"…) can be misread by machines and make your SKU unusable, so the ideal is to use only alphanumeric characters.
Of course, you are allowed to use dashes to divide your unique SKU according to attributes. As with Red 46: VRN-RGE-046, which can be read by category-colour-size. A mnemonic for humans and easy for computer systems!
2.1.2 What length for SKU codes?
Shopify advises e-commerce merchants not to exceed 16 characters, but rather to stay between 8 and 12-digit codes. And even between 4 and 8 characters if you don't have a lot of references. At Bigblue, we use a sequence of 14 characters separated into 3 parts.
2.1.3 Is it possible to have one SKU for several products?
If your SKU starts to group numerous items, it loses all its usefulness within your company. The whole point of SKUs is to save time! If you group the red varnishes all together without making a difference between the different shades of red, it can be complicated to make a precise inventory count. Hello mess!
For example, making the collections appear in the SKUs can be interesting. Let's start again with our friend the red varnish: if it belongs to the fall-winter 2020 collection, its SKU could be VRN-RGE-046-AH20 to uniquely identify it from others.
2.1.4 Is It possible for this to be done automatically?
Of course, you don't have to do everything by hand! There are SKU generators like SKUGen for e-merchants on Shopify or Skugenerator for Gorgias users.
The use is simplified to the maximum: you just have to fill in the information about your products (size, colour, gender, …), and the generator gives you a ready-to-use SKU!
2.2 How to generate a European Article Number (EAN) code?
It is possible to generate a barcode or an EAN code in 2 different ways: in an officially recognised way on all physical marketplaces and stores, or in a fast and free way to understand the process.
2.2.1 The GS1 platform
There are 3 main families of barcodes. The most common in Europe is the GS1 EAN 13 which belongs to the large family of one-dimensional or linear codes and contains 13 digits.
As an online store, make sure that your barcodes are recognised and unique to your product (which is essential if you want to sell on marketplaces, for example). You can generate them on the official website of GS1, the worldwide organization that generates barcodes for many countries (France, Belgium, and the US…).
To be able to generate barcodes on this site, you must become a member. Membership is quite simple and fast to make, and is divided into 2 steps:
1. The membership itself: fill in the information requested about your company (KBis, Code NAF…), and pay the membership fee. The latter is calculated according to your turnover and your field of activity. Once this membership fee is paid, you will have to pay an annual licence each year.
2. Once you are a member of GS1 and have your company code, you can generate your barcodes yourself! The next step is referencing your products, either 1 by 1 or using a .csv file that groups them all together.
Finally, you only have to put your barcodes on your products, either by having them printed directly onto your packaging or by adding them thanks to a label glued or hung on your individual product.
2.2.2 A low-cost solution?
If you don't want to sell in supermarkets or on a marketplace (Amazon, for example…), you don't have to go through GS1 to obtain barcodes. There are free barcode generators on the internet. However, by going through this solution, there is no guarantee that the barcodes obtained are not already linked to another product in France or abroad.
In addition to identification and traceability, you could use the barcode as an aesthetic element. And yes, a barcode on an item is not necessarily ugly: it can even be a plus for your packaging and wrapping. It's all a question of perspective.
Style your barcodes! Designer Steve Simpson has found many ways to integrate the EAN code into the product, elegantly and graphically. The idea is no longer to hide it, but to assume it and design it!
SKU and e-commerce barcode: no more confusion!
As soon as you start an e-commerce activity, generating SKUs for all products is recommended. This unique number allows you to facilitate one of the 3500 tasks of your day as an e-commerce merchant.
Once your business grows, SKUs are no longer enough.
If you want to sell to a larger audience, such as in supermarkets, for example: the barcode becomes indispensable. Whether it is for carriers, suppliers, your future logistician in charge of the whole procedure and coordination…
Not working with barcodes can become an obstacle to the smooth running of your business. So, to allow yourself to expand as much as you deserve, how about switching to barcodes? Now you have all the keys to get started!
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