A jewelry store’s inventory often includes many small, high-value items that can prove to be an inventory management challenge. A loss of even a few pieces each quarter could mean thousands of dollars in shrinkage affecting the bottom line. Many jewelry retailers conduct time consuming manual inventory counts each quarter. These labor-intensive processes are expensive, they leave room for human error and their infrequency can delay the replenishment of goods, resulting in lost sales.
Several jewelry retailers have turned to automated inventory systems that integrate RFID technology to conduct faster and more frequent inventory counts. These companies are benefiting from drastic reductions in labor costs and shrinkage that can result in a fast recuperation of the costs from the initial system deployment. While improved inventory management may be what draws a jeweler to RFID, there are many additional benefits to automated inventory systems that can be leveraged to improve the sales process or offer additional services to customers.
RFID Streamlines Inventory Processes
After the implementation of an RFID inventory management system, Dallas Gold & Silver saw a drastic reduction in inventory related labor costs. In the past DG&S would conduct a physical count of each piece quarterly. This would require the manager of internal controls to visit each location to manually count and log each of the company’s 7,500 pieces. It was estimated that the inventory count of the main Dallas branch alone would take 60 hours. The tedious manual system was costly in terms of labor and prone to human error.
The RFID solution created by Electronic Inventory Solutions has allowed DG&S to move to a continuous inventory system that tracks goods as they move through the store each day. A passive EPC Gen 2 RFID tag is attached to each piece of jewelry, watch and rare coin in the store. Each morning sales representatives use a handheld RFID reader to conduct a simple inventory by waving the reader over each tray as it is removed from the vault. The information is checked against the current inventory lists and management is alerted to any discrepancies. After implementation DG&S has significantly decreased labor costs and increased accuracy in the store’s database.
Retailer Uses RFID to Improve the Buying Experience
Five years ago, Sissy’s Log Cabin deployed an RFID solution designed for jewelry retailers from Northern Apex. Sissy’s has seen a considerable ROI in terms of inventory process improvement and found a way use RFID to offer customers a more personalized shopping experience.
Regular customers at Sissy’s can get a personalized key fob that stores information about their previous purchases and items they have recently looked at when visiting a Sissy’s store. Each time a customer is shown a piece of jewelry, the Smart View Counter Pad reads the attached RFID tag and logs the item in the customer’s profile. The information is used to create a better buying experience for the customer by easily recalling pieces that they have shown an interest in and suggesting complimentary pieces available in the collection. Also, store management is able to gain further insight into customer buying habits by analyzing the pieces shown to the customer against the final purchase.
RFID Maintains Slim Inventory and Simplifies Bridal Registries
High-end retailer Mantranga deployed an RFID solution designed by Dynamic ID to maintain adequate stock levels and streamline inventory systems. Since its implementation in July 2011, the store has seen a 96% decrease in the time needed to conduct inventory of its 12,000 items and has leveraged the system to provide additional services to customers.
When a bridal couple visits a Matranga store they select items they would like to receive as wedding gifts and place them on a counter fitted with a fixed RFID reader. This information is paired with the couple’s record in the Jewel-ID database and is made available as their wedding guests visit to purchase goods. When a guest buys an item, the RFID tag is interrogated and the couple’s profile is updated in real time to ensure the newlyweds won’t receive duplicate gifts.
Purchased items are logged as sold in the inventory system and the buying team is alerted that it needs to be replaced. This automated system allows Matranga to keep slim inventories while not missing out on sales opportunities due to infrequent inventory checks. Matranga estimates an ROI on the RFID system within less than year based on reduced labor costs and improved inventory counts ensuring no out-of-stocks occur at either location.
See how other retailers have benefited from integrating RFID.
About the Author
Impinj is the leading provider of RAIN RFID solutions.More Content by Impinj Inc