What does a Stock Keeping Unit (SKU) represent?

A Stock Keeping Unit (SKU) is a unique identifier that is assigned to each distinct product and service that can be purchased. It serves as a means of tracking inventory at a granular level, allowing businesses to manage stock efficiently. Each SKU differentiates products based on various attributes such as size, color, or type, making it easier for retailers and warehouses to monitor availability, sales, and turnover rates.

This identification system is crucial for inventory management because it simplifies the process of ordering, selling, and replenishing stock, ensuring that organizations can effectively meet consumer demand while minimizing costs associated with overstocking and stockouts. By using SKUs, companies can quickly locate items within their inventory systems, facilitating better organization and faster responses to customer needs.

The other options do not accurately reflect the primary function of a SKU. For instance, while sales strategies, demand forecasting, and supplier performance metrics are all important aspects of supply chain management, they do not pertain directly to the role of a SKU in inventory tracking and management. Thus, option B is the most accurate representation of what an SKU signifies in the context of supply chain operations.