Amazon SKU Best Practices for Sellers

By Becky Phipps · 3 min read

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If you have ever tried to reconcile an inventory report, chase down supplier details, or troubleshoot a mismatched listing, you already know: SKU creation matters. A well-structured SKU system saves hours of work, prevents costly errors, and makes your business scalable across Amazon, Walmart, eBay, and beyond.

The challenge? Most sellers treat SKUs like throwaway IDs. That may work fine in the early days, but once you manage hundreds or thousands of products, it quickly becomes unmanageable.

In this post, I’ll share the SKU format I use, how it works, and the best practices you can apply to design your own consistent system.

The SKU Formula That Works: YYMMX-UPC-SKU-Supplier Code

My preferred format looks like this:

YYMMX-UPC-SKU-Supplier Code

  • First 5 characters (YYMMX): This flexible prefix often represents year and month, but it can be repurposed for other uses such as product condition or fulfillment type. Examples:

    • 2012X = December 2020
    • USDLN = Used Like New
    • USDMF = Used Merchant Fulfilled
    • USDVG = Used Very Good
    • USDGX = Used Good
      The key is always keeping the first five characters reserved before the dash for consistency.

  • UPC (or ASIN/MPN): The product’s unique identifier. If no UPC exists, substitute with:

    • ASIN (Amazon Standard Identification Number)
    • MPN (Manufacturer Part Number)
    • An internal part number

  • SKU: The supplier or manufacturer’s shorthand product code.

  • Supplier Code: A three-character code you assign to each supplier. It can be an abbreviation, an internal label, or any consistent marker. Example: AIL for Acme Industries, LLC.

Example: New Condition

2012X-083745293609-BKY06911S-AIL

  • Introduced December 2020
  • UPC: 083745293609
  • Supplier SKU: BKY06911S
  • Supplier Code: AIL (Acme Industries, LLC)

Example: Repurposed for Used Conditions

  • USDLN-083745293609-BKY06911S-AIL = Used Like New
  • USDMF-083745293609-BKY06911S-AIL = Used Merchant Fulfilled
  • USDVG-083745293609-BKY06911S-AIL = Used Very Good
  • USDGX-083745293609-BKY06911S-AIL = Used Good

This approach gives you near-infinite flexibility without breaking consistency.

Why This Works

  1. Organized: Easy to track new and used products alike.
  2. Traceable: Supplier codes tie products directly back to the source.
  3. Flexible: The first five characters can represent dates, conditions, or fulfillment types.
  4. Scalable: Works whether you have 10 SKUs or 10,000.

Amazon SKU Best Practices

  • Use 5 characters before the first dash: Builds consistency into your system.
  • Keep SKUs human-readable: If your team cannot understand it at a glance, it is too complex.
  • Do not reuse SKUs: Retire them permanently to avoid confusion.
  • Standardize supplier codes: Always use the same three-character code for each supplier.
  • Stay within Amazon’s limit: SKUs can be up to 40 characters long.
  • Avoid unsupported characters: Stick to letters, numbers, dashes, and underscores.
  • Document your format: Even a one-page guide can prevent costly mistakes.

Closing Thoughts

Your SKU format is like your filing system: invisible when it works, painful when it doesn’t. The goal is not complexity, but clarity and consistency.

The format I use (YYMMX-UPC-SKU-Supplier Code) works well for my business, but it is not the only way to build SKUs. Every seller can create their own structure to fit their catalog and suppliers. The most important rule is to stay consistent.

About the Author

Becky Phipps runs a 7-figure Amazon business from her garage, where she has mastered product sourcing, logistics, and scaling e-commerce brands. With more than 15 years of experience selling online, she shares insights on entrepreneurship, marketing, and the realities of building a business from the ground up. Outside of work, Becky is an avid plant-grower, book-reader, and mom.