A product unique code, also known as a product ID, SKU, item number, or UPC, is a unique identifier assigned to a product by the manufacturer or seller. The main purposes of product unique codes are to identify, track, and scan products easily.
Some key things to know about product unique codes:
- They are alphanumeric codes, usually consisting of letters and numbers.
- Each product variation (size, color, etc) will have its own unique code.
- They help retailers keep track of inventory and sales.
- Barcode scanners use them to lookup pricing and product info.
- Consumers never see most unique codes – they are used internally by retailers.
- UPCs are a standardized type of barcode that includes a unique 12-digit product code.
Let’s look in more detail at the different types of product IDs and their specific uses:
Types of Product Unique Codes
UPC stands for Universal Product Code. This is the most common type of barcode used worldwide. UPCs consist of 12 numeric digits broken into the following parts:
- First digit – indicates product type (0=grocery, 1=restricted distribution, etc)
- Next 5 digits – assigned to the manufacturer
- Next 5 digits – assigned by the manufacturer to identify specific product
- Final digit – check digit calculated automatically based on other digits
For example, a 12-pack of soda might have a UPC of 049000050093. The first 0 indicates it is a grocery item. The next 5 digits, 49000, identify the Coca-Cola Company. And the last 5 digits, 50093, specify this particular product.
UPCs are primarily used to track products and look up pricing during checkout. Barcode scanners convert the black and white lines into numbers that pull up the product details from a database. Retailers can also use them for inventory management.
EAN stands for International Article Number and is a standardized barcode system used worldwide, except in North America where UPC dominates.
EAN barcodes use 13 digits instead of 12:
- First 2-3 digits – country code
- Next 4-5 digits – manufacturer code
- Next 5 digits – product code
- Final digit – check digit
While less common in North America, EAN is worth mentioning as a product ID type you may encounter, especially when dealing with imported goods.
ISBN stands for International Standard Book Number. It is a 10 or 13-digit number used to uniquely identify published books, textbooks, eBooks, audiobooks, and other monographic works.
ISBNs use the following format:
- For 10-digit ISBNs:
- First digit – format/edition (3=hardcover, 4=paperback, etc)
- Next 8 digits – registrant, title and check digit
- Final digit – check digit
- For 13-digit ISBNs:
- First 3 digits – GS1 country prefix
- Next 2-5 digits – registrant code
- Next 6-7 digits – publication year and edition
- Next 1 digit – check digit
ISBNs provide an easy way for publishers, booksellers, libraries, and readers globally to identify books. They are commonly printed inside the book’s front cover. ISBNs also underpin crucial book trade data like prices, sales, inventory counts, and more.
SKU stands for stock keeping unit. It is an identifier code assigned to each unique product variation by a company to track inventory. The key difference from UPCs is that each product variation gets its own SKU.
For example, a t-shirt that comes in 3 sizes and 4 colors would have 12 SKUs, while still sharing one UPC. This allows the retailer to track the inventory and sales of each variant. SKUs are internal IDs not seen by consumers. They often follow a simple format like:
- Product type abbreviation (TSHIRT)
- Size variant (S, M, L)
- Color variant (RED, BLK, BLU)
So a red small t-shirt might get a SKU like TSHIRT-S-RED. Clothing, shoes, furniture, electronics, and other products with many configurations usually use SKUs for inventory management.
Manufacturer Part Number
Also called MPNs, these are unique codes assigned by product manufacturers to identify their inventory items. Retailers need to track MPNs in addition to their own SKUs and UPCs.
MPNs follow proprietary formats that vary by manufacturer. They tend to use shorter codes than public identifiers like UPCs. For example, an electronics maker might assign model D450-A the MPN “901009”. MPNs provide insight into the company’s internal operations and supply chain.
Global Trade Item Number (GTIN)
GTIN is a set of globally unique 14-digit numbers used to identify trade items, products, and services. GTINs unify UPC and EAN under one system. They follow these format rules:
- GTIN-8 – 8-digit code derived from longer GTINs, often on small products
- GTIN-12 – 12-digit UPC
- GTIN-13 – 13-digit EAN
- GTIN-14 – 14 digits used in packaging levels beyond consumer units
GTINs make it easier for companies to identify, capture, and share item data across retail systems globally. They provide a consistent link between online and offline trade transactions.
How Product Codes Get Assigned
For new products entering the retail system, manufacturers or brand owners generally take responsibility for assigning unique codes and barcodes. Here is the typical workflow:
- A company requests a new UPC or GTIN range from their local GS1 agency. This ensures globally unique numbers.
- They assign UPCs sequentially to each consumer variation of the product.
- The manufacturer prints packaging with the barcode version of the UPC.
- They share product data like descriptions and MSRP with retailers carrying the product.
- Retailers add the new UPCs and information to their inventory system.
- As inventory depletes, the retailer places orders with the manufacturer using UPCs to specify products.
Without a standardized system, retailers would have no way to differentiate products from thousands of manufacturers. They would not be able to track inventory properly. By centralizing UPC management and product data sharing, GS1 helps the supply chain flow smoothly.
For their own internal use, retailers can choose how they want to assign SKUs. There are no global standards for SKUs. But most retailers follow logical systems so workers can memorize them. Simple SKU formats with small product codes, size indicators, and color codes are common.
Product Codes in Retail Inventory Management
Within their inventory management systems, retailers add a variety of additional data tied to each product code. This can include:
- Product descriptions
- Categorization (clothing, electronics, etc)
- Department (apparel, sporting goods, etc)
- Vendor details
- Warehouse location
- Inventory quantities
- Unit sizes (weight, dimensions)
- MSRP and retail price
- Tax codes
- Order quantities and frequency
- Shipping methods
Connecting all this data to UPCs or SKUs lets the retailer efficiently monitor and control their inventory. When integrated with point-of-sale and accounting software, they gain insights into:
- Which products sell fastest
- When to reorder items
- Ideal inventory levels
- Revenue and profit by product
- Seasonal demand patterns
- Slow-selling products to discontinue
Without product IDs, retailers would face huge challenges managing large product catalogs across hundreds of stores and warehouses. The codes provide a backbone for inventory control.
Benefits of Product Unique Codes
Here are some of the main benefits that product unique codes provide for manufacturers and retailers:
- Accurate identification – codes precisely identify products amid thousands of SKUs.
- Efficient scanning – barcode scanners lookup pricing and info in milliseconds.
- Inventory tracking – systems can monitor stock levels and sales by product.
- Supply chain insight – UPCs provide visibility into product flows between links.
- Loss prevention – unique IDs make it harder to substitute products.
- Labor savings – codes automate tasks like stock taking and order-picking.
- Analytics – product sales and performance data helps guide business strategy.
In short, the global system of standardized product identification codes has massively increased efficiency and insights for retailers over the past 50 years since UPCs debuted. Barcode scanners and inventory control systems rely on product unique codes behind the scenes to deliver timely data.
Challenges with Product Codes
Despite their benefits, product unique codes come with some challenges that companies need to manage:
- Updating information – new product data must be shared accurately across the supply chain.
- Duplicate codes – UPC reuse could break inventory tracking.
- Digit errors – incorrectly printed or scanned codes cause problems.
- Counterfeits – criminals create fake product IDs and barcodes.
- Compliance – retailers must follow UPC technical protocols.
- Obsolescence – some old codes need to be retired and replaced.
- Label positioning – barcodes must be accessible by scanners at checkouts.
Manufacturers and retailers put extensive checks in place to minimize these issues. For example, automated verification that barcodes match linked product data. Or regularly auditing that inventory counts match sales volumes. And staying up to date on evolving barcode standards.
Future Product Identification Technologies
While UPC and other codes seem very established, technology keeps evolving. Here are some examples of new product identification and data techniques on the horizon:
- RFID – radio tags provide identification without line-of-sight scanning.
- Digimarc – imperceptible digital watermarks embedded in packaging.
- Image recognition – using photos of products to identify them.
- Blockchain – distributed ledger for supply chain visibility.
- Smart packaging – tags or sensors to track conditions.
- Digital assistants – using voice commands to lookup product info.
These technologies open new possibilities like fewer checkout delays, improved inventory accuracy, smarter reordering, and easier recalls. Over time, standardized product data methods will continue to evolve alongside advances in identification technology and computing.
Product unique codes are the unsung heroes that underpin modern retail. While consumers don’t think about the UPCs and SKUs behind the scenes, they enable everything from barcode scanning at checkout to analyzing enterprise inventory data.
Standardized systems of identification codes and barcodes allow smooth product information flow through the supply chain. Retailers can track inventory, sales trends, and supply needs at the SKU level. Manufacturers gain production and shipment visibility across their product lines.
Despite some operational challenges, unique product IDs provide massive efficiency benefits. New technologies promise to build on their capabilities even further. Product codes will continue to play a critical linking role as retail processes evolve.