Blog February 20, 2018

Food Start-ups: Generate Smart Data You Can Use

By Gabrielle Tiven
February 20, 2018 | 2 min read


Your business can generate lots of data, but that information will only be useful if you collect it and keep it in ways that can be analyzed. Here are two fundamental ideas about data collection to keep in mind as you set up your business processes:

1. Name your data clearly. Give your products unique, simple product IDs (often called SKUs), and use the same descriptions for them everywhere. Sales orders, purchase orders and production orders should have their own unique ID numbers.

2. Keep historical data. Don’t overwrite each week’s or month’s numbers with new data. Make sure the old data is searchable and can be pooled to show performance over time.

There’s an optimal point somewhere between collecting too much data and not enough, and the challenge is finding that sweet spot. Err on the side of more until you figure out what works, but be sure to capture at least some transactional data and use it to understand and improve your business.

What makes a good SKU number?

A SKU is a stock keeping unit or product ID, and each product should have a unique one for internal use. A SKU is different than a universal product code (UPC) or barcode, which is a type of Global Trade Item Number issued for external use by GS1, a standards organization.

Here are some simple guidelines for creating good SKU numbers, but remember that there’s no one right answer for all businesses:

›› Length – between 4 and 8 digits is comfortable, and keep them all the same length. The number of digits depends on the number of items you expect to sell: for more products, leave yourself a larger namespace (i.e., more digits).

›› Characters – use numbers and letters (except I and O), but don’t use symbols

›› Human-readable – you should be able to read and say the numbers aloud easily

›› Simple – don’t try to imbue the numbers with too much meaning. The system will likely lose its original significance as you need to name items you never conceived of at the beginning. A simple numerical list is OK as long as you have clear names and descriptions.

Reach out to the LIDD team to learn more about warehouse slotting and optimizing your warehouse operations.

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