Explainer: Identifying the right product

I have had the opportunity to help companies that sold a variety of products: apparel, footwear, books, food, electronics, jewelry, furniture, and general consumer goods. For the most part, these companies have struggled with the definition—the construction—of their item identifier.

Companies that make and sell a product are responsible for creating an internal identifier for each unique item. In industries like retail, grocery, and publishing, there are what can be considered intermediary item identifiers that act like cross-references between the manufacturer item identifier and the buying party’s reference for the item. In U.S. retail and grocery, the intermediary item identifier is the GTIN-12/UPC (Global Trade Item Number, 12-digits, which was formerly known as the Universal Product Code), and in the book publishing industry there is the ISBN (International Standard Book Number).

(The manufacturer of the product is responsible for the creation and maintenance of the intermediatory item identifier, e.g., the GTIN-12/UPC.)

Related: The Perfect Order: Right Product

The internal item identifier that a manufacturer or retailer creates and assigns within their respective software systems to a unique item is also known as the SKU (stock keeping unit). But what are the attributes that comprise a SKU in its definition and construction? There aren’t really any rules, but having a methodology helps. The SKU can be a meaningless or a meaningful identifier, but most companies I know prefer it to have meaning.

Since the internal item identifier or SKU may be limited by software system data field constraints, let’s simply notate this in the conversation but let’s not let it limit our discussion. Most software systems today, e.g., ERP—enterprise resource planning systems—are flexible enough to support robust item identifiers within reason.

Similar to the definition and construction of a multiple-segment general ledger account code, or how warehouse (distribution center) locations might be defined as something like “Building-Aisle-Shelf-Bin,” we can look to define items by base attributes in a hierarchical structure. In doing so, I always start with the foundational characteristics of an item: style, color, and size.

• Style: Product line, brand, composition
• Color: Primary color, finish, multi-color
• Size: Singular size (e.g., S, M, L); numbered size (e.g., 1, 2, 3); multi-dimensional size (e.g., 32x30); footwear size (e.g., 6, 6.5, 6.5W); weight (e.g., 32 ounces, 64 ounces, 1 liter)

There are no hard-and-fast rules here, nor is there a requirement that the SKU be only a three-component identifier of style-color-size. Adding a fourth component for Line (e.g., men, women, girls, boys, or along the concept of different flavors) could be applicable and help to keep one of the baseline attributes uncomplicated. (A “Line” of products could also be “indoor” or “outdoor.”) Instead of an item’s color, perhaps an item’s container is more important. Consider that the components of a well-structured SKU identifier can enable enhanced sales analysis reporting (on top of or along with item attribute data fields) and make it easier to identify the right product throughout the supply chain.

(NOTE: I would keep special characters like the period in fractional footwear sizes, e.g., 6.5, out of an item identifier and out of an item description. Special characters can cause problems, maybe not in your software system, but possibly in the software systems of your supply chain partners. Dashes (hyphens) are likely and typically okay, but I wouldn’t recommend the following special characters in either an item identifier or item description: single quote, double quote, exclamation, ampersand, hash/pound/number, dollar sign, percent, caret, asterisk, plus, forward slash, back-slash, question mark, comma, colon, semi-colon. There are other ways of representing fractions with numbers and letters.)

Remember: the SKU is a unique item. Sixty-four ounces of the same drink in a glass bottle and in a cardboard carton are two different SKUs because the product container is different. The same style shirt in 100% cotton and in 50/50 cotton/polyester are two different SKUs because the shirt composition is different.

In assigning the intermediary item identifier—such as the GTIN-12—most companies that I help will try and make an intelligent assignment between the serial number component of the GTIN-12 and the SKU. Don’t. This will ultimately be a futile numerical exercise. The serial number part of the GTIN-12 is just that: a serial number. At most, reserve serial numbers 0 through 9 for internal testing and product development experimentation and start with serial number 10 if you want. Otherwise, treat the serial number as just that: a serial number.

Once put into use, a GTIN cannot be used again. This is a policy change by GS1 that can be found at: https://www.gs1us.org/resources/data-hub-help-center/gtin-non-reuse-rule

Go to the GS1US website—www.gs1us.org—and use the search magnifying glass option with the search term “floor ready merchandise.” Scroll down and you will find a document titled “GS1 US Color and Size Codes Guidelines.” This document may help provide your company guidance in developing color and size data values that are aligned with those already established by GS1 and recognized within the retail industry.

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