Apr 03, 2015With the help of radio frequency identification technology to manage the movements of its diamonds and jewelry throughout its own offices, as well as to third-party service providers and stores, jewelry and diamond wholesaler IGC Brand Services has been able to increase the volume of products it sells, as well as reduce the amount of inventory required onsite. At any given time, the Chicago-based company tracks more than 10,000 diamonds and other pieces of jewelry, valued at approximately $5 million, as those products are moved through its offices and workshop, to outside vendors for custom production work, to retailers or consignment shops in the United States and Canada, and sometimes back to its own facility. The RFID solution consists of Gem Accountant software provided by Custom Systems Inc., as well as RFID readers and tags supplied by TJS.
IGC Brand Services makes branded jewelry and cuts loose diamonds. With recent changes in the diamond business—most significantly, the use of the Internet by consumers to peruse, learn about and select the best diamonds for their needs—selling diamonds is not as profitable for smaller-sized jewelry retailers as it used to be, the company reports. There is also a greater need to ship products very quickly as they are ordered, since consumers expect fast service.
Due to the changes in the market, IGC has expanded its business in recent years beyond selling loose diamonds on a wholesale basis. Jewelry has now become the company's primary business, and with the growing volume of jewelry comes greater concern regarding the tracking of inventory through the multiple locations within its own Chicago office.
Traditionally, jewelry wholesalers use paper ledgers or bar codes to manually track when products are received, processed or sold. At IGC, merchandise could be located within a storage vault, or in a box at each employee's station where jewelry is processed, or be sent out to another jewelry vendor at a different site. In addition, products are sometimes returned by retailers that are IGC customers. In such a situation, each item must be carefully checked to ensure that it is the same diamond or jewelry piece that was sold in the first place. The company ships out as many as 500 orders every month.
The company installed an RFID-based system about two years ago. Prior to that installation, periodic inventory searches required multiple employees many days to go through all items, says Bill Casey, IGC Brands Services' inventory manager. Casey came onboard after the RFID technology was installed, in order to help manage the greater volume of data and functionality that the company achieved thanks to this automation.
"The biggest problem for dealers is that every item is worth so much, and has to be individually tracked," says Gikas Markantonatos, Custom Systems Inc.'s owner. "Before RFID came along, it could be several weeks after something has gone missing that the problem could be discovered." With the RFID functionality, he adds, companies like IGC Brands can improve efficiency be reducing the need to manually count items, and detect much more quickly when a piece of inventory has gone missing. It also enables wholesalers to quickly identify if there is a discrepancy between the inventory of items shipped by the manufacturer and what was actually received.
With the RFID-based system at IGC Brands, passive 13.56 MHz high-frequency (HF) RFID tags, compliant with the ISO 15693 standard, are being attached to each item of jewelry, as well as to each paper envelope containing loose diamonds. This month, IGC's jewelry supplier began attaching a barbell-shaped label fitted with a TJS Insert Tag to each ring or chain made at its facility in Thailand. Prior to that, IGC Brands attached the tags as the items were received at its own location. When diamonds arrive from its supplier in Botswana, IGC Brands attaches a TJS Diamond Tag to each gem's envelope (a special piece of paper that folds around a single diamond to create a container) and inputs data related to that item into the Gem Accountant software, to be linked with the tag's unique ID number.
When IGC receives a box of tagged jewelry from its Thai supplier, a staff member uses a Kenetics Volaré handheld reader or a TJS Desktop Scanner reader to interrogate the tag IDs of all products. The Gem Accountant software then updates the items' status as received. If there is a discrepancy between the products shipped and those received, the software alerts the company immediately. Once the new merchandise has been received, workers can indicate in the software that the items are being moved directly into the vault, where they are then stored until needed to fill an order.
Once an order is received from a retailer, the jewelry and diamonds required to fill that order are removed from the vault, and a handheld reader can then be used to document that removal. Workers keep the items in a box next to their workstation as they work.
IGC staff members work on the diamonds and jewelry at their stations. At the end of the day, any item that is not finished is stored in a box at the corresponding employee's station. At that time, Casey says, he walks around the office—which is one of three suites in Chicago's Mallers building—and reads the tag IDs in each box to ensure that no items are missing. The tagged items in the vault are read less frequently, he notes, since they are not as vulnerable to being lost.
When an order is shipped to a customer, Casey explains, each item's tag is read in order to create an invoice report and consignment memo. "These documents serve as the packing list for shipments." he states.
If a retailer returns a product, IGC Brands must follow a protocol to confirm that the item is genuine and unaltered. With RFID, this requires that an employee read the item's tag to confirm that it is the same product, and then complete a visual inspection. Without RFID, Casey says, a worker must look up records about that item in the paper ledgers or spreadsheet.
Casey uses RFID not only to identify if anything might be missing, but also to ensure that the company need not overstock its inventory to meet orders, since it now has a more accurate record of which items are available onsite. With this greater knowledge, he adds, the firm can more easily expand its product offerings to other jewelry items, because it does not need to manage that growing inventory manually.
TJS provided the tags and readers, as well as software to manage the collected read data and forward that information to the Gem Accountant software. The company offers full solutions to jewelry companies and other customers, according to Gabriel Nasser, TJS' CEO.
"It's hard to overstate the impact RFID had on us," Casey says. "My job wouldn't be possible without it," Casey will describe his company's experience with RFID in detail at this year's RFID Journal LIVE! conference and exhibition, taking place in San Diego, Calif., on Apr. 15-17.
