When it comes to GTIN vs SKU, both are essential in managing and tracking inventory, but what’s the difference? In this post, we’ll break down the differences between GTINs (Global Trade Item Numbers) and SKUs (Stock Keeping Units). Whether you’re managing a small shop or scaling an e-commerce platform, understanding how to use both can save you time and streamline your operations.
What Is A GTIN Number?
A GTIN, or Global Trade Item Number, is a unique identifier for a physical product that is used to track items through the supply chain. GTINs are commonly encoded into barcode format and are recognized universally. This ensures they can be used across the supply chain and helps consumers verify the authenticity of a product they’re purchasing.
What Is An SKU?
An SKU, or Stock Keeping Unit, is a unique identifier that businesses create internally to track and manage inventory. Unlike a GTIN, which is universally recognized, SKUs are customized by companies based on their needs. SKUs help to identify and track individual products, manage inventory, and track sales.
The Different Types of GTIN
There are four main types of GTIN, each with a specific format. The type depends on the product, packaging, or region.
- GTIN-12: A 12 digit number that is commonly used in the US and Canada. GTIN-12 numbers are encoded in UPC barcodes, mostly for retail products.
- GTIN-13: A 13 digit number that is commonly used in international markets. GTIN-13 numbers are encoded in EAN barcodes, mostly for retail, global trade, and e-commerce.
- GTIN-14: A 14 digit number used on bulk or case-level product identification, such as cases, pallets, or multipacks. GTIN-14 numbers are encoded in ITF-14 barcodes or GS1 DataBar symbols for logistics and supply chain management.
- GTIN-8: An 8 digit number used for very small products with limited packaging space. GTIN-8 numbers are encoded in EAN-8 barcodes.
How GTIN and SKU Are Different
When comparing GTIN vs SKU, both are product identifiers that are used to manage products. However, they serve very different purposes. GTINs are universally recognized across the supply chain, while SKUs are unique to the businesses that use them. Here are some more ways GTIN and SKU are different:
Uses
Some of the most common ways GTINs are used include:
- Global product identification: Ensures products are universally recognizable across retailers, marketplaces, and platforms.
- E-commerce platforms: Required by online retailers like Amazon, eBay, and Walmart to list products.
- Barcode scanning: Used in point-of-sale (POS) systems for faster and more accurate checkout.
- Supply chain management: Tracks products through the supply chain from production to sale.
- Market expansion: Facilitates cross-border trade by ensuring consistent identification across various regions.
- Regulatory standards: Required for compliance with GS1 standards in global trade.
- Consumer transparency: Allows customers to verify product details, including expiration dates and authenticity.
- Food and pharmaceutical tracking: Essential for compliance with safety regulations like the FDA’s traceability requirements or EU food labeling laws.
- Customs and shipping: Simplifies customs clearance with globally accepted product identifiers.
On the other hand, here are some of the different ways SKUs are used:
- Inventory management: Tracks stock levels, movements, and locations internally.
- Sales analysis: Identifies best selling and slow-moving products.
- Product customization: Helps businesses differentiate between variations, such as size or color.
- Restocking: Makes reordering specific items faster and more accurate.
- Operational organization: Streamlines internal workflows by linking products to warehouses, departments, or sales channels.
- Industry standards: Aligns with specific business sector practices, like tracking SKUs for retail or manufacturing compliance.
- Audit: Provides traceability during internal audits or tax reporting.
Scope
One of the main differences between GTIN vs SKU is their scope. While GTIN is universal so that products can be recognized and sold worldwide, SKUs are local, used only within the business that created them.
Format
The format of GTIN vs SKU differs significantly because they serve different purposes, are created in different ways, and follow different rules. GTINs are only made up of numbers, with no letters or symbols included. They have a fixed number of digits–8, 12, 13, or 14.
SKUs, on the other hand, are usually a mix of letters, numbers, and sometimes symbols. They are highly customizable and do not follow any standard format. There is no required length, which means they can range from short codes, such as TSHIRT-M to long combinations, such as LUX-BLK-LG-WM-BUSHRD.
Structure
Structure is another area where GTIN and SKU differ. GTINs follow a specific structure, depending on the GTIN type being used. They usually start with the company prefix assigned by GS1, followed by the item reference, and ending with a check digit that helps check for errors.
Because SKUs are created internally, they don’t have a fixed structure. However, typical details included in the SKU are product category, size, color, or material, and location or warehouse. For example, for a blue, medium t-shirt might use the following SKU: TSHIRT-BLU-M. The large variation would use this SKU: TSHIRT-BLU-L.
How They’re Made
GTINs and SKUs are both made in different ways from one another. In order to create a GTIN, your business must register with GS1, the global standards organization that manages GTINs. GS1 will give your organization a unique company prefix. From there, each of your products will be assigned a unique item reference number. Finally, with the company prefix and product number, you can calculate a check digit to ensure the GTIN is valid.
SKUs, on the other hand, have a lot of flexibility when being made. Your business will decide on the structure based on what information you want to include. Most companies have a style guide used to define varying codes. From there, you’ll assign each product or variation (such as size or color) a unique alphanumeric code. Once you have the SKU, you can enter it into your business’s inventory management software to enable tracking.
Visibility
The visibility of GTIN and SKU differs quite a bit. GTINs are designed for external visibility. They’re used in global trade and need to be visible in all international supply chains and retail systems. GTINs are typically encoded into barcode format for fast checkout and inventory management.
In comparison, SKUs are not as visible and are often not seen by customers. They’re used internally by businesses for inventory management within an inventory system. For example, during order fulfillment, staff might use SKUs to locate and pick the correct items.
How They’re Similar
Now that we’ve compared GTIN vs SKU differences, let’s look at some of their similarities.
Product Identification
Both GTIN and SKU are used to uniquely identify specific products so that each item in a catalog or inventory can be distinguished from other similar products. GTINs are recognized internationally so that no matter where the product is sold, it can be authenticated. SKUs, on the other hand, are only used within a store or warehouse.
Inventory Management
Both identifiers can help businesses manage and organize their inventory more efficiently. Using GTIN and SKU enables accurate tracking of stock levels and movement.
Automation
Because GTIN and SKU are compatible with barcode technology, they both can be used to automate processes. For example, when used at POS, checkout is faster with more accurate counts. GTIN and SKU can also be integrated into inventory management software for automated inventory counts and tracking.
How They Help Your Business
Both GTINs and SKUs play vital roles in streamlining business operations. GTINs enable global product recognition, allowing your products to be tracked and sold worldwide. On the other hand, SKUs help with internal inventory management, making it easier to track product variations, manage stock levels, and analyze sales performance. Together, they improve your efficiency, reduce human errors, and provide valuable insights that can help your business grow and stay competitive.
How to Choose Between Them
Choosing between GTIN vs SKU depends on your specific needs. If you’re looking to comply with industry standards, sell on major e-commerce platforms, and sell products globally, you’ll need a GTIN. However, if your goal is to improve your internal inventory management, SKU is the right choice. In most cases, both can be used together.
Can One Product Have Both?
Yes, one product can have both a GTIN and an SKU. In fact, it’s fairly common for businesses to use both at the same time. The GTIN is used for global product identification across e-commerce platforms and retailers. The SKU, on the other hand, is something you would use internally within your business. Having both can make your external and internal operations run more efficiently.
Why GTIN Is Used in E-Commerce
GTIN is used in e-commerce because it ensures that products can be sold globally with a universally recognized identifier. It helps create more accurate listings so businesses can provide correct product information. Additionally, many e-commerce platforms require GTINs when listing products since they allow buyers to make sure they’re buying the right product.
Is GTIN Used Locally?
Although GTIN is universally recognized, it’s also used locally. For example, in the US, GTINs, in the form of UPC barcodes, are used in retail for quick and accurate scanning at checkout. GTINs can also be used in inventory management as well as with tracking through the local supply chain. However, if you aren’t selling your products globally, you won’t need a GTIN.
How Do SKUs Help with Inventory Management?
SKUs play an important role in inventory management. They provide a unique identifier for each product and product variation. Each color, size, or style of a product has a unique code that allows businesses to differentiate between similar products. This prevents errors when finding or stocking items. SKUs also help businesses track how much of each product they have in real time. By tracking sales, businesses can also ensure they stock the right amount of products.
GTIN vs SKU Labels
Now that you understand the differences and similarities between GTIN vs SKU, you may be ready to start improving the efficiency of your inventory management systems.
Coast Label can help. We print custom GTIN and SKU labels made from the highest quality materials to suit your unique needs. Contact us today for a proposal!
