Bullwhip: How Coronavirus Hit Meat Distribution

Bullwhip: How Coronavirus Hit Meat Distribution

Several major meat companies were forced to shut down processing plants in Q1 2020 due to the severe coronavirus outbreaks in their facilities. At one point, meat and poultry giant Tyson Foods published a full-page ad in the New York Times declaring that “The Food Supply Chain is Breaking.” The recent report on COVID outbreaks in meat and poultry plants published by the Centers for Disease Control found that nearly 3% of the 130,000 workers tested were coronavirus-positive – that’s almost 60 times the known infection rate in the United States – a fact which is not shocking, given that workers often stand shoulder-to-shoulder, making social distancing impossible. Industries verging on oligopoly that has had no competitive reason to improve processes over the last century are particularly vulnerable to the bullwhip effect, or the impact of inefficient inventory/distribution management on the rest of a supply chain – and now that COVID is spreading like wildfire in rural states as of the end of Q2, it’s safe to say America won’t be out of the pandemic’s grip for awhile.

Let’s examine how the bullwhip effect could move through a hypothetical scenario involving a meatpacking company as an argument for making investments in smarter distribution processes.

Obviously, when coronavirus hits in a tight, unsanitary environment, COVID isn’t far behind. Mass sickness will do a few things. Decreased manpower without temporary replacement or adequate automation to pick up all possible slack could result in temporary output shortages. When that decreased supply meets overwhelming demand, a few things could happen. First, supermarkets could experience mass stockouts. This would cause them to reorder supply in larger amounts. If they get that larger amount by the time demand has decreased, they run the risk of waste, and will order much less product the next time around. These forecasting fluctuations can ripple back to warehouse and supply chain managers, who may respond by cutting contracts with small farmers, consolidating facilities near major distribution hubs, making inefficient inventory allocation decisions, and rethinking their truck routes. The latter may become increasingly difficult if the processing facility infections spread onto products and trucks, infecting truck drivers. Entire subregions may be cut off from supply if there is a significant shortage of transportation personnel. With decreased revenue, increased human resources costs, and a shattered distribution chain, meat companies might lack the cash flow or shareholder confidence to survive.

How can companies like this mitigate the coronavirus bullwhip effect for years to come? Fill out the form below and we’ll send you our latest white paper on how the industry is adapting.

Enrage Your Customer, Part 4: Bad Product Pages

This is the fourth installment in a parody series about doing bad business. The content herein should not be taken seriously. Logistics for Hire is in no way liable for the stupid consequences of following this stupid advice.

You think you’re the future of eCommerce. You’re a traffic master, and your products are great. Customers love your products – until they get them in the mail! The culprit: your online store! Here’s how to make your customers furious by completely neglecting your product pages.

When you take photos of your product for your online store, don’t use a lightbox – just take a picture in your living room. You’ll make that sweater look way more comfortable by doing your photoshoot under ugly yellow lights, right next to your dark red curtains. That won’t make it look different at all! A friend told you that you should white-balance your camera, and use color-perfect CMYK mockups whenever possible, but listen, that seems way too complicated, and nerds don’t buy your stuff, so don’t bother. Sounds expensive too – definitely not worth it. Definitely don’t take multiple angles of your product, either – after all, why would anyone who’s about to buy a $10,000 amplifier need to know what kind of cables it takes?

If you have the chance to take a good-quality video of your product, forget it. Your customer can deal with your 2002 flip phone camera that’s 2 pixels wide and lags like a tortoise. There’s no reason to give them any sort of in-depth preview when a bad photo is enough, and if they don’t like it, they can go somewhere else.

Don’t forget to forget shipping estimates on your product pages. If the customer really cares, they’ll find out right before they give you their hard-earned cash that their last-second Christmas gift will actually take 6-8 weeks to arrive by international post (in really tiny print – what they don’t know can’t hurt them).

If your customer opens their package to find the great piece of clothing you made for them and happens to love the way it looks, don’t worry – there’s still a chance to make them angry. Forget to tell them that your stuff runs super small or super big! It’s the best feeling in the world to feel like you can’t fit into a pair of jeans or shoes because of the cut, even though you chose your size. Don’t worry about putting sizing charts up on your store pages, either. What is this, Europe? You’re not responsible for people’s weirdly sized feet. And if you have 15 different colorways for the same article of clothing, throw them all on different pages and don’t bother standardizing descriptions across pages. It’s for their own good!

Write bad copy. Hire your sister’s 7th grader who can’t pass a writing class to do your product descriptions. Don’t put yourself in the mind of a consumer and use keywords that they might be searching for. Skip over this opportunity for storytelling and just use lots of numbers and vague terms like “the best.” They can’t argue with the truth!

Instead of a big CTA button that says “ADD TO CART” in large, prominent text, add a regular text hyperlink at the end of your description. It’s on the customer to find it. You never took an HTML course, and you’re too good to hire someone to help you, so buttons are out of the question.

And, finally, no need to include customer reviews. This customer can find out for themselves; why do they need to hear from 100,000 Instagram followers, a celebrity, or a recent buyer, all of whom gave your stickers a five-star review?

The techniques we’ve gone over are sure-fire, guaranteed ways to enrage your customer – but if you need more, consider treating them like garbage or stocking out of everything they want.

This headache-inducing nightmare scenario brought to you by CommerceBlitz, the warehouse and wholesale software that makes you – and customers – happy. CommerceBlitz prioritizes simplicity and ease of use, so you can concentrate on the most important parts of your business, earn those positive reviews, and never lose a package!

5 Tricks to Getting the Most Out of Your Wholesale Software

Being successful in the wholesale game is a totally different challenge than being successful in your direct-to-consumer business. Wholesale relies on your skill in building fruitful client relationships that allow you to sell in bulk. To make sure the cash flow is always there and keep making the things people want, you have to pitch buyers, make them best-in-market offers, and then follow up with them in order to keep them coming back. But you can’t spend all your time on just one area of business management, so you need the best software for wholesale distribution that you can get; you need an innovative platform that frees up your bandwidth to make smart decisions and focus on selling instead of a bulky ERP system that has too many unnecessary functions.

Once you settle on a platform you like and can use seamlessly, here are 5 best practices to getting the most out of it:

Butter Up Your Buyer

We’ve already said that wholesale is about relationships; what better way to make a client feel special than to give them special pricing? Look for a function that can set a global discount for a particular account. If someone knows they have an exclusive, blanket 10% off everything in your store, why wouldn’t they become a repeat buyer right then and there?

Make Sure Your Inventory is Accurate

There’s nothing more disappointing than being on the cusp of a purchase decision and realizing you’re out of stock. To avoid stockouts and keep resellers happy, couple your wholesale platform with a solid inventory management software that gets inventory sync right every single time. If you sell an item on Shopify, your inventory on Amazon should be automatically adjusted accordingly. And you don’t have time to do that yourself – because you’re busy concentrating on what matters!

Encourage Bulk Purchases

Volume buying keeps sales consistent, cash in the account, reduces manufacturing costs per unit, and keeps everyone in the know and on a level playing field. Your wholesale software should be able to offer tiered discounts to your clients depending on the quantity per product they hit. If they can save an extra 3% by stocking up on another 10 units they’re forecasting being able to sell anyway, why not take the plunge? Tiered and global discounts also lighten your workload; you’ll never be flipping through pages of a document containing a million promo codes figuring out which ones you have to delete or which ones you have to create. This makes it easy to stay tuned in to the important parts of your enterprise.

Exports Should Be Quick and Clean

Remember, the more steps you go through when exporting data to your accounting software, like Quickbooks and Xero, the more chances exist to lose data integrity. Your bookkeeper will be a huge fan of yours if the data coming from your wholesale software is regular and organized. Since most e-commerce platforms have limited APIs, you’ll need to export data to a .CSV file before you upload into your accounting platform of choice, but there are plenty of processes that you can put in place to make sure what goes out matches what comes in.

Make Your Storefront Welcoming

When choosing a website on which to host your wholesale store, go with a platform that offers easy templates as well as customization options in case you or someone you know can custom code the store of your dreams. Shopify, for example, makes it really easy to place and track orders without additional plugins, so you can spend your time on making store augmentations that make sense for your business. As an added bonus, our wholesale plugin app is easily accessible through the Shopify store, so you don’t have to spend hours doing custom connections!

How to overcome the 5 biggest pain points in warehousing

A warehouse is, as you probably know from experience, a vast network of tiny moving parts, scan beeps, pallets, orders, and more. To have happy customers, you have to consider your warehouse operations in a way which is organized and can both dispatch orders on time and fulfill returns in an appropriate fashion; this can range anywhere from traffic management to labor, from software to hardware. Here are the top 5 warehousing pain points we’ve observed – and how you can avoid them:

Inefficient warehouse layout

Think about the way your warehouse is designed. Does it look like it was designed by a civil engineer who understands principles of traffic flow, takes strict measurements, and makes sure every vehicle and case can be stored optimally? Or is it closer to hoarding but with some basic shelving and labels? If you’re thinking the latter, you may want to consider a layout update. Warehouse layouts “must be modular, adaptable, compact, and accessible and must be capable to respond to changing conditions…sometimes, trade-offs must be made between conflicting objectives” (Geraldes, Carvalho, et al).

Answer some key questions for yourself, like: are my employees zig-zagging too much, and can I restructure things to send them on a straight path to the shipping lane? Would it be better to store perishable items away from doorways, or if a product is seasonal a sells quickly, would it actually be better to position it closest to the main sources of traffic? You’ll save time and money taking a hard look at your floor plan and maybe even making some changes.

A google image search shows nearly endless possibilities for best warehouse layouts.
A google image search shows nearly endless possibilities for best warehouse layouts.

Inefficient picking/packing processes

When you were first starting your warehouse, you probably sought some sort of guidance on picking and discovered, very quickly, the complete lack of standard process. Unfortunately we’re frequently on our own when it comes to warehouse picking best practices, and we may often develop a system that’s inefficient. Items often end up in the wrong location, pickers pick the wrong item altogether, and multiple people can cause chaos – along with a litany of other potential issues. Picking and packing is probably around half your operation anyway; why not look to improve?

There are a few ways to make the operation more lean and effective. First, consider an easy-to-use warehouse management system. Software that doesn’t come with the baggage of a difficult learning curve can empower employees to teach each other – and makes temporary/seasonal work a breeze. You’ll save time and sweat on training alone! Second, make sure your process is logical. Second, ensure accountability. When you have people out on the floor making decisions, you want to have the ability to identify kinks in the machine and make corrections for the good of the team, so always know who’s done what. And last, keep shelving orderly and clean! A cluttered world makes for a cluttered brain.

Inventory shrink/poor inventory management

Oh, this is everyone’s favorite. How often has this happened to you: you sell something on one e-commerce channel, but there’s nothing to automatically decrement that inventory from another e-commerce channel, and then you forget all about it, resulting in a sudden stockout and delays in service? Worst of all, that sync button that some inventory management systems claim to have down perfectly is terrible IRL. And then there are the unlikely but logical worries: theft, accidents…

One thing is for certain: although there are always bound to be problems you can’t control, your software must not make the problem worse – so look for a system that adjusts omnichannel inventory in real time. Ensure there are safety, security, and ergonomics precautions taken to prevent workplace/retail breakage or stealing. And finally, use predictive analytics and continuously updating business insights to see stockouts way before they hit you – and double check everything’s on track in case on hits you by surprise.

Failing to prioritize return flow

Returns are often a tertiary consideration when thinking about warehouse spaces. The logical flow of a warehouse in an ideal business scenario is receive-pick-ship; you might assume that returns will never happen or deprioritize them because you’re just so damn good at what you do. Wrong! Proper return and refund procedure is the cornerstone to preventing customer attrition in case one particular experience doesn’t work out the way you hoped. Getting items back in and restocking as quickly as possible means you can have speedy communication with the customer about their refund – and that customer lifetime value still has a great chance of increasing.

So consider your procedure: what happens to a returned package? Is there a form to fill out? Is there a restocking fee? Do your books have to be adjusted if the product is damaged or required refurbishment? Do you have adequate space to process a ton of returns at once, in case a particular day goes horribly wrong? And – as mentioned above – how does the returns space fit into your overall warehouse plan? Answering those questions and addressing relevant issues with due consideration will give your operations a leg up over the competition.

Low morale

Human labor is dynamic— and because you just can’t automate everything, it’s here to stay. Manual labor is tough, and low morale can lead to – you already know the list – bad work, absence, turnover, insubordination, blah, blah, blah. Avoid it. Be nice to your employees. Do things for them to remind them you care.

Here are a few examples of things you can do that will tangibly improve your staff’s outlook: first, make them take breaks. Yes, 2020 corporate culture might tempt you to punish employees who are neurotically above and beyond, but investing in process and procedure could save you the time that you’d normally expect employees to work through! Create a culture that makes them want to be there. Inexpensive employee outings, summer Fridays, all of that stuff… it’s proven to work. Celebrate a milestone with a cake. What’s it cost anyway, 15 bucks? Make collaboration a two-way street. If you’re looking for insight into their daily experience, why not just ask? If you’re looking for ways in which things could be improved, there is no better person to get feedback from than the one who experiences that task or procedure firsthand on a daily basis. Plus, staff who are consulted will feel like they have a more personal stake in the affairs of your business.

(Oh, and spend that extra money on frequent deep cleans of the facility, since we’re mid-pandemic and all. Don’t want half your crew getting sick!)

Getting a grip on these points of tension will make your business so much more successful – but we know there are always issues that may be unforeseen and may require new solutions. Contact us if you ever have any questions about our products or a general inquiry. We’ll get back to you ASAP!

-The LFH Team

A Quick Guide to Inventory Management vs ERP:

If you’re starting a warehouse for the first time, you’ll eventually come face-to-face with the dilemma of how to organize it. You’ll already have some back-end tools, like Shopify, that does a great job helping you sell your stuff, but you’ll have no idea where that inventory lives, what’s going out when, etc. Your first impulse may be to go with a big-name brand enterprise resource planning system that combines a hundred business features into a giant platform – but that might not be your smartest option. In this quick blog, we’ll review the differences between ERP (enterprise resource planning) systems and inventory management systems – and by the end, you may be surprised enough to change your mind.

What is ERP?

Enterprise Resource Planning systems are typically used by companies to do supply chain planning from start to finish. Because they are all-encompassing, they are usually massive in size and scope. If you go with something like Oracle or Netsuite, you’ll often need multiple server rooms to handle all of the data, plus you’ll have to install the software on every single computer, and you may be stuck with a ton of features you don’t need. For example, if you do white label product shipping, what do you care where your manufacturer gets their raw materials from? ERP systems are usually reserved for large businesses that encompass multiple unique verticals. If you’re a small to medium size business that just makes and sells a particular product line, you may not need to go with a full-stack system; it may be better for you to integrate multiple, smaller options and build a custom setup that works for your operational flow.

Outline of ERP features. Source:

What is an Inventory Management System?

Inventory Management software tracks how much stuff you have and where it is. Every warehouse operation requires an inventory tracking software to keep a meticulously detailed account of exactly where your goods are located, where they came from, and where they’re supposed to go. When companies choose to keep manual records instead of inventory management that syncs accurately across channels, they tend to be at risk for stockouts, overstocks, and incorrect picking/shipping.

Ideal inventory management systems will synchronize with digital stores to help warehouse personnel keep track of what inventory has been scheduled to ship out, as well as any inventory which is to be received for returns processing.

Advantage of Inventory Management Systems Over ERP Systems

How often has this happened to you: you sell something on one e-commerce channel, but there’s nothing to automatically decrement that inventory from another e-commerce channel, and then you forget all about it, resulting in a sudden stockout and delays in service? Worst of all, that sync button that some inventory management systems claim to have down perfectly is terrible IRL. And then there are the unlikely but logical worries: theft, accidents…

One thing is for certain: although there are always bound to be problems you can’t control, your software must not make the problem worse – so look for a system that adjusts omnichannel inventory in real time. Ensure there are safety, security, and ergonomics precautions taken to prevent workplace/retail breakage or stealing. And finally, use predictive analytics and continuously updating business insights to see stockouts way before they hit you – and double check everything’s on track in case you get hit by surprise.

Bottom line: unless you’re a large enterprise that takes meticulous counts of raw materials and tracks costs across the entire supply chain, you probably don’t need an integrated ERP system. It can save you tens or even hundreds of thousands of dollars in the long run to work with some IT-minded individuals and develop a lean system of software that only does what you need it to. Feel free to reach out if you have any questions; our CommerceBlitz OMNI Warehouse Inventory Management System starts at $199.95 a month, and no, that rate doesn’t go up after a month!

-The LFH Team

Enrage Your Customer, Part 3: Stockouts

This is the third installment in a parody series about doing bad business. The content herein should not be taken seriously. Logistics for Hire is in no way liable for the stupid consequences of following this stupid advice.

“Do you have this product in stock?” It might be the most basic lay-up of a question a customer has ever asked you. Whether it’s in a brick-and-mortar store or online in a live chat, if someone asks you if you have a particular SKU, it usually means they’re ready to try it or purchase outright. But you don’t want a happy customer, do you? No! You want to infuriate them! Prove that neither you or your staff know what they’re doing by making this obvious opportunity for a sale into a living hell for everyone – just by following these easy steps.

First, make sure you invest in a cheap, flimsy warehouse management system that can’t sync your inventory accurately across channels. When a flood of Amazon orders stocks you out, who’s going to make sure that your Wayfair stock is updated? Let the customer give them your money for a product they think is in stock but actually isn’t, then send your worst customer service reps to clean up the mess. Maybe if you wait long enough, they’ll give up on trying to get their money back!

Hire an extra person to make incorrect inventory adjustments between your ecommerce and your warehouse instead of having a reliable sync function, and leave the process vulnerable to constant error. In fact, why make software a solution at all? Just pay for a team that you can pay 5x more than a computer to do the process wrong – and as an added bonus, they’ll need three days to do it.

Next, you’ll want to make sure your operation is leaky as all hell. Don’t bother with a security system, cameras are creepy. Don’t create an inventory process that ensures accountability either – why would you want to keep record of who’s near your precious merchandise at all times when you can just trust a temp you barely know? If someone steals, forgive and forget! They probably needed that product more than you did.

Never try to forecast demand. After coronavirus, who knows what they’re talking about when they forecast, anyway? You might as well just leave your quantity levels up to pure chance and if the customer gets an out of stock alert, too bad for them! You don’t need their money. Calculating safety stock would be a great way to solve that problem – but math is for nerds. You came here to win, baby!

Don’t work with your suppliers to provide restock estimates. You work harder than them and can’t be bothered. The customer has it too good! Even if they practically beg you to let them pay you, don’t offer a digital funnel that notifies them of a restock. It’s the luck of the draw, and if they don’t want to check your website every day, twice a day, for that Totoro pillow case, well that’s just too bad. Plenty of fish in the sea!

Finally (and this is our favorite): stay out of stock for months. It’ll make your customers angry for awhile, but as soon as they figure out you’re not good for what they want, they’ll just leave you altogether and make a mental note to never come back.

What? Isn’t that what you wanted? After all, they kept bothering you all the time! Now you don’t have to deal with them anymore!

The techniques we’ve gone over are sure fire, guaranteed ways to enrage your customer – but if you need more, consider losing their shipment or misleading them online.

This headache-inducing nightmare scenario brought to you by CommerceBlitz, the warehouse and wholesale software that makes you – and customers – happy. CommerceBlitz prioritizes simplicity and ease of use, so you can concentrate on the most important parts of your business, earn those positive reviews, and never lose a package!


How to Help Your Retailers Sell Your Stuff

You’ve just invented the world’s most comfortable socks, the most effective toothpaste, or a supplement that increases lifespan – or maybe you just sell yarn online. In any case, whether selling to consumers (business-to-consumer, or B2C) or retailers (business-to-business, or B2B), optimizing your online product listings has amazing benefits for your business. You’ll sell more of your inventory and gain brand new data insights into purchasing habits and more. By understanding what qualities provide maximal product visibility, as well as the pitfalls that can make products suddenly invisible online, you’ll learn how to skyrocket your e-commerce store into the stratosphere.

High-Content, High-Information Products Get Found

If you were to ask us how to find a book in a library, you’d have the easiest time if we gave you the most information. Sure, the name and the author would make a great start, but you’d have an easier time if we told you other things you could look out for, for example: the Dewey decimal number, so you could find the section it was in; the physical dimensions of the book, so you could approximate it in your mind; and maybe even the color and if it was a hardcover or softcover.

Similarly, users looking for products online search with every single detail about the product in mind. Mechanics browsing a wholesale store for aftermarket car subwoofers need to know the ohms so they can wire it properly. New homeowners who want to install a vanity in their master bathroom need to know the exact height, width, and depth to see if they can fit it in that little nook without stubbing their toes every day. People with allergies to certain fabrics need to know the exact blend of cotton, polyester, and nylon in those shirts of yours – and seemingly important qualities like size and color suddenly become secondary.

You’ll see that Rockford Fosgate easily ranks for 16-inch 2-ohm subwoofers.
You’ll see that Rockford Fosgate easily ranks for 16-inch 2-ohm subwoofers.

So what kind of attention to detail would it take for users to find your products when they search “2 ohm 16 inch car subwoofer,” “52 inch granite countertop vanity,” or “100% cotton workout tee men?” Consider those questions and more when writing your product descriptions and filling in each data field in the back end of your store.

Another recent example: the author of this post was looking at waterproof shells for his camera on a fairly established and reputable website. The product came in three sizes – Small, Medium, and Large – but nowhere on the page did it say exactly what that translated to in inches or centimeters. Guess who’s not shelling out $40?

Sometimes, you may want to go above and beyond what your preferred e-commerce service offers when it comes to product data fields and telling the whole story. Sometimes the filtering options may be inherently limited. In this situation, see if there are any extensions that provide additional data fields. Our CommerceBlitz Wholesale B2B app happens to do this exact thing for Shopify, our favorite online store service.

Visuals, Visuals, Visuals

Many business owners think a single photo for each product is enough. It’s simply not. Check out this example of the #1 best-selling telescope on Amazon. It has seven images. They don’t even all have to be amazing. (Also, while you’re at it, note the title of the product, which mentions the specifics of the telescope’s focal length and aperture, target audience, and all items included in the bundle.)

This best-selling telescope has 7 different images for a single product bundle.

What’s that second-to-last image? Someone standing in front of a moon with a telescope? Maybe not the most technical of snapshots, but it helps tell the story. This is what users need to be swayed into a purchase decision. When you’re shooting photos of your home-sourced honey jars, take multiple angles in a light box, attach a flat render of the label as another image, and maybe a photo of the honey on a table cracker. Take individual photos of each component in a bundle. Illustrate the point. Create the purchase intent – and only then can the user make an evaluation on price.

Arm Your Buyers/Retailers with the Ammo They Need

Here’s the crucial part of what we’re saying when it comes to wholesale: your retailers will take cues from you. The liquor store is already focused on stocking their shelves, cleaning their facilities, COVID-19 precautions, etc. – if they want to run a promotion for your new red wine, they’ll look to you for tasting notes and other marketing language. If Best Buy is having a sale on Samsung TVs, their Samsung rep is the first resource they’ll go to for more details. Online, this builds SEO credibility, which increases organic product visibility overall. If a ton of well-trafficked websites are syndicating your exact language because they can’t possibly come up with anything more specific, you’ll rise to the top when users search for your specific keywords and details – and as an added bonus, your brand will stay consistent across all digital properties. If you have the ability to manually force language changes over a seller’s online platform, make sure you do the best job possible. Help them help you. Sell to them so they can sell to you.

Bottom Line: Less Isn’t More, More is More.

When it comes to e-commerce, providing as much detail as possible will help a massive online universe find your little neck of the woods. Remember – if you’re giving directions to someone on the street, do better than pointing and saying “go that way.” Use language clearly and deliberately, for example, “go down South Avenue, past that second light, then take a right and look out for the blue building with the white awning; you can find parking in the back.” Same principle online. Guide the user to your product page, then make them an offer they can’t refuse.

Follow these steps and you’ll boost your online sales in no time. And if you have any questions, DM us on Facebook and we’ll get back to you!

The Ultimate Guide to SKU Creation

Every product out in the world can have multiple types of unique identifiers, depending on the type of person that needs to see it. For example, whenever you’re at the store you can clearly see a barcode and corresponding number on most items on the shelf. These are called UPCs, or Universal Product Codes; essentially, they’re a way for a computer to recognize the product and tell you what its price is. There are other types of codes that can be assigned to products, though. For example, a book has a specific code called an ISBN, or International Standard Book Number, that help identify details like edition, recommended price, and more. Amazon has a proprietary coding system for products sold through their platform called ASIN, or the Amazon Standard Identification Number; this is generated when a product is uploaded and helps both sellers and distribution center personnel.

But these codes all tend to be more consumer- and retailer-facing. What do companies use when dealing with their own inventory? Welcome to the world of the SKU, or Stock-Keeping Unit. SKUs are unique identifiers created by companies so that their own warehouse, sales, and customer service teams can identify inventory more easily – and unlike barcodes, which are issued by a standards organization according to certain guidelines, SKUs follow only one set of rules: those made by whoever creates them. It’s because of that same flexibility that SKUs also have the potential to get messy – or downright useless.

Here’s our guide to strategically creating a SKU system that works for you:

Organize Logically

SKUs are pretty much exclusively for use by you and your teams, so make them in a way that makes sense for your particular business needs. Generally speaking, a good rule of thumb is to code your SKUs leading with the most general information (e.g. brand or product line) and ending with the most specific information (e.g. product size). So, for example, if we had a warehouse full of hard drives, and we wanted to give a SKU to the LaCie Rugged Thunderbolt USB-C 5TB External Hard Drive, we might phrase it in the following order: LAC (LaCie) –> RG (Rugged) –> TBC (Thunderbolt/USB-C) –> 5 (5TB). Warehouse staff would be easily able to locate the drive by using the SKU LAC-RG-TBC-5. If you wanted to store the 2TB variant right next to it, no problem! Use the SKU LAC-RGD-TBC-2. If you want to sell some of the older USB-A versions of the drive, you might consider the SKU LAC-RGD-UBA-500GB.

Only use information that can help you immediately locate the item in question and verify that it’s correct. For example, if you have a sneaker warehouse, it’s best to avoid less obvious traits like the material the sole is made out of. If you have TVs, it’s probably best not to include the year the TV was made.

Avoid Symbols If Possible

This #%&* can get confusing. No, really, symbols have no place in SKUology. Stick to alphanumeric characters, with the exception of hyphens; this method is more intuitive and less easily misread. For example, can you imagine the mayhem if the difference between your $200 item and your $5,000 item was that one SKU read 550 GBS and the other read 550 GBS? Get ready for a lot of angry customers!

Avoid Binary and Lowercase

Avoid zeros and ones in your SKUs. Why? Simple: they’ll get confused for O’s and I’s. We’ve seen it happen before – and way more often than you might think. Speaking of confusing, ever get a capital “I” confused with a lowercase “l?” It happens all the stick. Stick to capital letters.

Don’t Just Use the UPC

Sure, you can’t get more unique than a UPC, but it will make your warehouse team’s lives so much more difficult! Imagine having to open every box to make sure that the correct item is inside because the SKU isn’t intuitive. And imagine, for just a second, that the manufacturer included the wrong UPC on the item. (This is not as rare as you think.) Well, now you’re screwed for sure!

Short(ish) and Sweet(ish)

Limit the size of your SKUs. Remember that the variable we’re optimizing for is ease of use, not necessarily specificity. If your staff can easily locate a product with half the amount of information while maintaining the same tiny rate of inaccuracies (remember Six Sigma training?), then that’s good news. Don’t overcomplicate things and make people read more than they have to.

Oh, and… Use a Font That’s Legible

We can’t begin to tell you how many times someone thought it would “look good” to print all of this information in a complicated serif font because it was “consistent with the brand.” No! Use bold, sans-serif fonts like Arial, Montserrat, or Helvetica. Shouldn’t have to have a slash through the zero if you’re not using zeroes to begin with (see above). Keep it simple!

That’s It!

It’s not complicated – and if it is, you’re doing it wrong. Make up a system that works for you and yours, and don’t worry about what others are doing. After all, you’re the master of your own business!

White Paper: Adapting Logistics to the Coronavirus Pandemic

48 Logistics Acronyms You Need to Know

Online retail is one of the fastest growing industries in the world. At the end of 2018, Forrester, a leader in research and analytics firm stated that the B2B (Business-to-Business) e-commerce market reached $1.134 trillion – far above the expected $954 billion it forecasted at the end of 2017. The growth in this industry is still expected to rise with Forrester believing that this will climb even higher – about 17% by 2023.