How SKU Counts Impact Order Fulfillment

Did you know that some order fulfillment companies will not work with businesses that have a high SKU count? There are several reasons for this, but most of them come down to simplicity. Businesses with low SKU counts have fewer products to pick, making it easier to get orders out. As you start to compare fulfillment centers for your business, this is something you will need to keep in mind.

What Is a SKU?

A SKU is a stock keeping unit. It's a form of identification used to mark a specific item a company sells. Every product has its own SKU, including each size of shirt, each color of cabinet, each flavor of candy and more. SKUs for similar products may only have slight variations, with one or two letters changing to represent each version of the product.

Having separate SKUs for each item ensures that the customer gets exactly what he or she wants with no discrepancies whatsoever. Can you imagine how you would feel if you ordered a small white shirt and received a large shirt in lime green?

Why Some Fulfillment Companies Prefer Small SKU Counts

From a seller's perspective, it's important if not vital to have unique SKUs for each product. However, from a fulfillment center's perspective, an increase in SKUs means an increase in work. More SKUs make products harder to pick, and they create a greater chance of error in the picking process. It takes longer for pickers to find each item when they have a large number of SKUs to sort through, which boosts labor costs and slows down productivity. Some order fulfillment companies simply don't want to handle the headache.

With that said, there are fulfillment centers that work with large SKU counts. There are also centers that specialize in this type of order fulfillment. Knowing this information should not force you to create a smaller SKU count. You just need to find a company to accommodate your business.

What Is Considered a Low SKU Count?

This answer depends on the order fulfillment center. Some centers only work with companies that have 100 SKUs or fewer. Others will only work with 250 SKUs or less. Of course, there are plenty of retailers and manufacturers that have hundreds or even thousands of SKUs in their inventory. They work with fulfillment centers just like small SKU count companies. The only difference is that they have to find a fulfillment center that can handle the large volume of products they offer.

What to Do If You Have a High SKU Count

Having a high SKU count may be unavoidable, and it doesn't mean that you are without options. When selecting a fulfillment center for your business, make sure they are willing and able to handle a product line of your size. There are fulfillment companies that work with high SKU counts, and they have the staff/technology to accommodate those setups.

Contact Overflo at 1-800-626-0616 to learn more about the order fulfillment solutions available for your business.

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