What is the definition of a "stock-keeping unit" (SKU)?

A stock-keeping unit (SKU) is defined as a unique identifier for each distinct product and service that can be purchased. This identifier often includes specific details such as the product type, size, color, and other variations that help differentiate it from other items in inventory. The use of SKUs is crucial in inventory management, as they enable retailers and warehouses to track stock levels, manage order fulfillment, and analyze sales data effectively. Each SKU is distinct, ensuring that each product can be monitored and accounted for accurately, which is essential for efficient supply chain operations. This unique identification system helps streamline various logistics processes, from order placement to inventory auditing, thereby enhancing overall operational efficiency.