An SKU (or Stock Keeping Unit) is a unique number that you create to help manage and keep track of your stock. Etsy SKU numbers can be given to each variant of a product. Some sellers even go so far as to give each single product they make a unique SKU.Another perk of using an Etsy SKU system with is if you're selling elsewhere online. If selling on your own website with an eCommerce provider like Shoplo or Wix, an SKU is needed to issue receipts and invoices. Advertising on Google Ads or Facebook requires a Product Feed, which in turn requires an SKU.Rather than explaining how to set up an Etsy SKU system, let's use our sample Etsy store and do it!

Creating an Etsy SKU system

Let's start simple. You're selling rings. Gold and Silver. Take a 7 character number and put a letter that lets you clearly identify that item at the start. G or S for example.SKU for gold rings with Amethyst - GAxxxxxxSKU for silver rings with Amethyst - SAxxxxxxSKU for gold rings with Zirconia - GZxxxxxxSKU for silver rings with Zirconia - SZxxxxxxThese new versions are named variants. They are variations of a product.Before this gets more complicated, let's copy it into an excel spreadsheet to keep track of things easier.

We chose to use 7 characters as it gives us enough space to accurately describe the product without getting confusing. If you choose to use the number 1, don't use the letter L anywhere, as a small case l can easily be confused as a 1. The same goes with the letter O and the number 0 (zero).  Avoid using both of these altogether. We've replaced the number 0 with the letter x.Chances are that whatever you're selling will probably come in sizes. Small, medium and large, so that's 3 variants of each 6 variants we already have!

It doesn't take long for you to have a wide range of SKU numbers! Be that as it may, each version of every product you sell now has a unique number attached to it. Hurrah for being organised!Now, you can go to your Etsy store and put the relevant SKU numbers to the relevant products.

Now that all your products have their SKU number, a good move would be to keep track of quantity.  For this, make a second sheet in the same excel file and name it 'stock'.

Copy over the SKU numbers and then add columns to keep track of the quantities you have.

Now we have our SKUs and a spreadsheet telling us how many we have.  The hardest part now is keeping it up to date! This is all on you and requires a proactive effort to do so.  Yes, it takes time and can be frustrating to do. But good management is one of the key ingredients to operating a successful enterprise!

The Etsy SKU number and offline selling

Selling at a craft fair or other offline event? Put your spreadsheet on a tablet or phone and update it on the go.  Remember to deactivate the Etsy listing of any products you're selling at the market too. Not doing so may lead to you selling more than you have!

What happens when I get an order?

There is a lot of discussion amongst the Etsy community about the relationship of SKUs and order forms. Currently, when you receive an order on Etsy, the SKU doesn't show up on the order form.A lot of sellers (and external companies like us) are putting pressure on Etsy to put SKUs in order forms. This will mean that when an order is placed, it is simply a matter of looking for the specified SKU number, rather than reading the entire title. Titles are often optimised for SEO and can cause confusion.One workaround solution is to put each SKU in the listing title.  This does affect SEO though. For the time being, Etsy's current version of SKU implementation is a good way for you to manage your inventory offline.

Bonus SKU tips

• Use your SKU number as the name for photos of that product. For example, SAxxxxMx-01, SAxxxxMx-02, where the 01 and 02 represent the photo number. This makes it easier to located the correct product photo when looking for it on your hard drive.
• Don't use characters like < > ' , or & in your SKUs.  These will confuse programs like Excel and any other software that you may use your SKUs with.
• Make a 3rd page of the spreadsheet and dedicate this to sales.  Turn it into a calendar and enter which SKUs were sold on which dates. Also note whether they were sold at full price, discounted or part of a bundle.
• Make the most of your spreadsheet by laying it out like this:

This is the way that 3rd party programs like to see and use SKU numbers and the relevant quantities.  If you can get into the habit of identifying your product variants like this, you will soon excel at your stock management!Implementing a simple SKU system is a great way to get extra control over your Etsy inventory.  Through regular updating, simple habits will form.  When good management habits for, growing and scaling become safer and easier.  All this from a little SKU number!