Item Codification
If you have a well-established business with many physical items, you might have already given codes to your items. If not, you have a decision to make. We suggest that you should give codes if you have many products with long or complex names. However, if you have only a few products with short names, it’s better to use the same code as the item name.
1. Benefits
- Common naming convention.
- Decreases chance of duplicates.
- Clear definition.
- Aids in quickly identifying similar items.
- Item names grow longer with more types added, while codes remain short.
2. Challenges
- You need to memorize the codes.
- New team members find it challenging to learn.
- You have to constantly generate new codes.
3. Standardization
When multiple individuals are tasked with naming items, each person may adopt a different naming convention. Even within a single person’s naming process, they may inadvertently create duplicates, such as naming a product “Red Apple” and then later labeling a similar item as “Apple – Red”.
4. Rationalizing
It’s beneficial to limit the number of item types to minimize stock and simplify housekeeping. When introducing a new product, referring to item codes can swiftly identify if a similar raw material is already used in another product.
We advocate for this modest investment as it can streamline operations as your business expands, although it’s acceptable not to assign codes if your inventory is limited.