The Importance of SKU Management in the Jewelry Business and Best Practices

Published on May 29, 2023

By Thomas De Bonnet

Introduction

In the intricate world of jewelry, every piece can be unique, and every supplier is different. Some jewelers create unique, one-of-a-kind pieces, while others work with suppliers who provide them with identical products. Managing such a diverse inventory can be challenging, but that's where Stock Keeping Units (SKUs) come into play. In this article, we'll explore the importance of SKUs in a jewelry business and share some best practices for creating effective SKUs.

Why are SKUs important in a Jewelry Business?

SKU is a unique identifier that allows you to track and manage each item in your inventory, regardless of whether it's a one-of-a-kind piece or part of a bulk order from a supplier. SKUs are vital for jewelry businesses for several reasons:

• Inventory Management: SKUs simplify tracking of your inventory, making it easier to know what you have in stock, what's selling fast, or what's not moving.
• Efficient Ordering: With a well-structured SKU system, reordering becomes a streamlined process, ensuring you restock the right items at the right time, whether it's from a regular supplier or a unique piece to be crafted.
• Enhanced Customer Service: When a customer inquires about a particular piece, SKUs enable quick and accurate retrieval of item details, improving customer service.
• Data Analysis: SKUs provide valuable data for analyzing sales trends, forecasting demand, and making informed business decisions.

Creating Effective SKUs

A good SKU system should be easy to interpret, consistent, scalable, and accommodate both unique pieces and repeat orders. Here are some best practices:

• Start with a Logical Structure: Begin with broad categories (like necklace, ring, etc.) and then add specifics (like gold, diamond, size). For example, RNG-GLD-DMD-12 could represent a gold diamond ring of size 12. For unique pieces, consider adding a distinct identifier, such as a date or serial number.
• Avoid Confusing Characters: It's best to avoid characters that can be easily misinterpreted, like '0' and 'O', '1' and 'I', etc.
• Keep It Simple: Too many details can make your SKU overly complicated. Stick to the most essential product attributes.
• Leave Room for Growth: Make sure your SKU system is flexible enough to accommodate new items or categories as your inventory expands.

The Role of ERP Systems in SKU Management

Managing SKUs can be tedious without the right tools. A robust ERP system like Gem Logic can significantly simplify this process. From generating SKUs based on pre-defined rules or creating a tailor made SKU for a specific piece, Gem Logic can streamline your entire inventory management, enhancing efficiency and profitability.

In Conclusion

Efficient SKU management is crucial in the jewelry business. It not only simplifies inventory management but also contributes to better customer service and informed decision-making. Whether dealing with unique pieces or stock supplied from vendors, a good SKU system, combined with a robust ERP system like Gem Logic, can be a game-changer for your jewelry business.