SKU vs Barcode vs UPC vs EAN: What's the Difference?

Aleksander Nowak · 2026-02-14 · Industry Guides

Learn the difference between SKU, barcode, UPC, and EAN. See which product identifiers you need for your business.

SKU vs Barcode vs UPC vs EAN: What's the Difference?

If you're setting up inventory tracking, you'll encounter four terms that seem similar but serve different purposes: SKU, barcode, UPC, and EAN. Mixing them up causes confusion and errors.

Here's the simple version: SKU is your internal product code. Barcode is the visual representation (the scannable lines). UPC and EAN are standardized barcode formats used in retail worldwide.

This guide explains what each term means, how they relate to each other, and which ones you actually need for your business.

What Is a SKU?

SKU stands for Stock Keeping Unit. It's an alphanumeric code that uniquely identifies a product in your inventory system.

Key characteristics:

• Created by you (the seller/manufacturer)
• Can include letters and numbers
• No standard format (you design your own system)
• Used internally for inventory tracking
• Different businesses can have different SKUs for the same product

Example SKUs:

• BLU-TSHIRT-M (Blue t-shirt, medium)
• WAX-SOY-5KG (Soy wax, 5kg bag)
• FRAG-LAVENDER-100ML (Lavender fragrance oil, 100ml)

A SKU tells your team exactly what a product is. Good SKU systems encode useful information: product type, variant, size, color, or supplier.

SKU Best Practices

Keep it readable: Humans need to understand SKUs at a glance. BLU-M-SHIRT is better than 4729384.

Be consistent: Use the same structure across all products. If color comes first for one product, put color first for all products.

Avoid confusing characters: Skip 0 and O, 1 and I to prevent reading errors.

Include hierarchy: Start with category, then product, then variant. Makes sorting and filtering easier.

Don't reuse SKUs: If you discontinue a product, retire its SKU. Reusing causes historical data confusion.

What Is a Barcode?

A barcode is a visual, machine-readable representation of data. The pattern of lines (or squares, for 2D codes) encodes information that scanners can read.

Key characteristics:

• Visual format for encoding data
• Read by scanners or cameras
• Can encode various data types (numbers, text, URLs)
• Multiple barcode formats exist for different purposes

A barcode is not the same as the data it contains. The barcode is the image. The data inside might be a SKU, a UPC, or something else entirely.

Types of Barcodes

1D Barcodes (Linear): - Vertical lines of varying widths - Encode numbers or alphanumeric data - Examples: UPC, EAN, Code 128, Code 39

2D Barcodes (Matrix): - Square or rectangular patterns - Store more data in less space - Examples: QR Code, Data Matrix, PDF417

For inventory purposes, 1D barcodes handle most needs. 2D codes are useful when you need to encode more information (batch numbers, URLs, serial numbers).

What Is a UPC?

UPC stands for Universal Product Code. It's a standardized barcode format used primarily in the United States and Canada.

Key characteristics:

• 12 digits (UPC-A) or 8 digits (UPC-E)
• Numeric only
• Globally unique (no two products share a UPC)
• Managed by GS1 (the standards organization)
• Required by most US/Canadian retailers

UPC structure (12 digits):

012345678905
│     │    │
│     │    └── Check digit (calculated)
│     └─────── Product number (assigned by you)
└───────────── Company prefix (assigned by GS1)

To get UPCs, you register with GS1, receive a company prefix, and assign product numbers yourself. GS1 membership costs vary by company size.

When You Need UPCs

• Selling through major US/Canadian retailers (Walmart, Target, Amazon US)
• Products scanned at retail checkout
• Wholesale distribution requiring standardized identification

When You Don't Need UPCs

• Direct-to-consumer sales only
• Internal inventory tracking
• B2B sales where retailers don't require them
• Products never entering retail supply chain

What Is an EAN?

EAN stands for European Article Number (now called International Article Number). It's the international equivalent of UPC.

Key characteristics:

• 13 digits (EAN-13) or 8 digits (EAN-8)
• Numeric only
• Globally unique
• Managed by GS1
• Standard outside North America

EAN-13 structure:

4006381333931
│  │     │   │
│  │     │   └── Check digit
│  │     └────── Product number
│  └──────────── Company prefix
└────────────── Country code (40 = Germany)

EAN-13 includes a country code prefix indicating where the company is registered (not where the product is made).

UPC vs EAN Compatibility

Good news: these two formats are compatible. A 12-digit UPC becomes a 13-digit EAN by adding a leading zero.

UPC:  012345678905
EAN: 0012345678905

Most modern scanners read both. If you have UPCs, they work internationally. If you're outside North America and get EANs, they work in the US/Canada too.

How These Terms Relate

Here's how these concepts connect:

SKU (your internal code)
  │
  ├── Can be encoded in a barcode (Code 128, QR)
  │     └── For internal scanning
  │
  └── May link to a UPC/EAN
        └── For retail/wholesale
              └── Encoded as the scannable lines you see on products

Example:

Your product has: - SKU: SOAP-LAVENDER-100G (your internal code) - UPC: 012345678905 (retail identification) - Barcode: The scannable image encoding the number above

Internally, you track by SKU. When shipping to retailers, products carry standardized barcodes. Your inventory system links these together.

Which Do You Need?

If You Sell Direct Only

Create SKUs for internal tracking. Add barcodes (Code 128 with your SKU) if you want to scan for inventory counts and shipping. Skip UPC/EAN unless you plan to expand into retail.

If You Sell Through Retailers

You need UPC (North America) or EAN (international). Register with GS1 to get your company prefix, assign product numbers, and generate barcodes. Your inventory system should link your internal SKUs to these retail codes.

If You're a Manufacturer

Create SKUs for all raw materials and finished goods. Use barcodes (Code 128 or QR) for internal scanning during receiving, production, and shipping. Get UPC/EAN only if your finished goods enter retail channels.

Setting Up Your Product Identification

Step 1: Design Your SKU System

Plan your SKU structure before adding products. Consider:

• What information should SKUs encode? (category, variant, size)
• How long should SKUs be? (8-12 characters is manageable)
• What delimiter will you use? (dash, none)

Example structure: [CATEGORY]-[PRODUCT]-[VARIANT]

Step 2: Create SKUs for All Items

Assign SKUs to: - Raw materials - Packaging - Work-in-progress (if tracked separately) - Finished goods - Variants (each size/color gets its own SKU)

Step 3: Decide on Barcodes

For internal use, encode your SKU in Code 128 barcodes. This lets you scan items during receiving, production, counting, and shipping.

For retail, you'll need UPC or EAN. Either encode the UPC/EAN in standard barcode format, or work with a barcode service.

Step 4: Register with GS1 (If Needed)

If selling through retailers:

1. Register at gs1.org or your national GS1 office
2. Receive your company prefix
3. Assign product numbers following GS1 guidelines
4. Generate check digits (calculators available online)
5. Create barcode images for labels

Membership costs $250-2,500 initially plus annual renewal, depending on company size and how many product numbers you need.

Step 5: Print Labels

Print barcode labels for: - Products (UPC/EAN for retail, or SKU-based for internal) - Raw materials (SKU-based barcodes) - Bin locations (location barcodes for warehouse)

Use a thermal label printer for volume, or standard printer with adhesive sheets for small quantities.

Common Questions

Can I make up my own UPC numbers?

Technically yes, but they won't be globally unique and retailers won't accept them. For legitimate retail distribution, you need GS1-assigned numbers.

Do I need both SKU and UPC for each product?

For retail products, yes. The SKU is your internal reference. The UPC is the standardized identifier for the supply chain. Your system links them together.

Can I use the UPC as my SKU?

You can, but it's not recommended. These codes are long numbers with no readable meaning. SKUs like SOAP-LAV-100G are easier for humans to work with.

What about Amazon ASINs?

ASIN is Amazon's internal catalog ID. You still need UPC/EAN to list most products. Amazon links your code to their ASIN.

Do barcodes expire?

The barcode image doesn't expire. GS1 company prefixes require annual renewal. If you stop paying, technically your numbers return to the pool (though reuse is rare).

Can I scan barcodes with my phone?

Yes. Modern inventory software uses phone cameras to scan 1D and 2D barcodes. No dedicated hardware needed for basic scanning.

Summary

For most small manufacturers:

1. Create meaningful SKUs for all items
2. Use Code 128 barcodes encoding your SKUs for internal scanning
3. Get UPC/EAN only when selling through retailers who require it
4. Link SKUs to UPCs in your inventory system

Don't overcomplicate it. Start with SKUs and internal barcodes. Add UPC/EAN when your sales channels require it.

Tags: Inventory Management, POS Systems, Retail, Tracking