GSM Logistica Reduces Costs via RFID

Prior to the deployment, the company's processes relied on manual, error-prone, high-cost manual barcode operations.
Published: October 25, 2019

GSM Logistica, located in São Paulo, Brazil, has achieved cost reductions in the past 12 months thanks to a radio frequency identification solution implemented by iTag Intelligent Systems, a Brazilian company specializing in RFID.

According to Vladimir Sanchez, GSM’s CEO, “Last year, we had a 250 percent growth, and we understand that the RFID system differential has added a lot to that.” Prior to the RFID deployment, the company’s processes relied on manual, error-prone, high-cost barcode operations. “By applying RFID,” he says, “in addition to process agility, we have been able to reduce labor costs.”

Vladimir Sanchez

The RFID deployment follows GS1’s EPC passive UHF RFID standard. “We use data conversion in the EPC Gen 2 standard, but we have no GS1 registration,” Sanchez explains. RFID portal readers are installed at the company’s distribution center. “In this way, the reading is 100 percent efficient. Radio waves pick up only what is in each box.”

GSM is employing Acura Edge-50 readers and 6 dbi monostatic antennas for the deployment. “We currently use iTag’s 7X2 adhesive label with Impinj’s Monza R6 chip,” Sanchez reports. All tags are reused during the logistics process, he says, since GSM’s business model and iTag Alert 2.0 software features allow users to transport pouches between customer branches and have them return with tags still intact. “We have 11,145 pouches tagged and transitioning between customer branches.”

The introduction of RFID in its processes posed a big challenge, according to Sanchez, “since our supplier had not yet operated with any logistics company. Over time, we made several improvements to tailor the process and reach the desired level of excellence.”

One of the company’s directors was responsible for the idea of deploying RFID, Sanchez recalls, having predicted that an innovative process would bring commercial strength to the operation and add numerous benefits that could facilitate management. The system’s primary benefits include process agility, document and pouch control, and visibility. “We understand that system development never ends,” he states. “According to the needs we meet in our segment, we will always think of improvements that bring benefits to the process. The key is never to settle down. “

Integrating the RFID solution with enterprise resource planning (ERP) technologies will be the next step for the company, but the iTag Alert 2.0 application already works 100 percent online, Sanchez says, with application programming interfaces (APIs) designed to communicate with the Amazon-hosted database. “Today, we work with reverse logistics, back and forth from documents in corporate pouches,” he explains. “The starting point of the process is collection, reading and sorting, according to routes and states.”

Following delivery, the company reads each label’s QR code via a mobile phone, which allows customers to view delivery on a computer screen in real time. “With that,” Sanchez says, “we can offer a visible process from end to end.” The middleware is already fixed internally in the iTag Alert 2.0 tool, and part of the tool controls the pouches. “That is, we designed each software process and created APIs so that the tool would fit our business.”

According to Sanchez, the partnership with iTag played a key role in the project. “Through the work we did with our iTtag vendor,” he states, “we added their intelligence to our processes. This generated a perfect combination that bore us many fruits.” Deploying RFID, he adds, was an extremely positive experience. “We had challenges over time, because in creating improvements we realized new needs to be addressed—but just positive challenges. “