Saudi Arabia's luxury retailer Jade Jewellery implements Motorola's RFID technology to improve inventory management and security

The company also trades in diamonds and provides exquisite designs that attract a very selective clientele.

The Challenge: Problems with Security and Inventory

In the past, Jade Jewellery experienced substantial financial loss as a result of missing jewellery attributed to internal theft.

Close to a $267m worth of jewellery had been written off and the company could not accurately prove theft to the police due to lack of evidence.

The situation led to major accounting problems with inventory, and Jade Jewellery approached Depco Systems, a Motorola partner and leader in Radio Frequency Identification (RFID) solutions, to look for a technology solution which could monitor sales and in-store activities.

Depco Systems sourced three RFID hardware manufacturers, including Motorola, to conduct a six-month trial.

The Solution: Jade Jewellery Implements RFID technology

Following the trial, Jade chose Motorola's XR480 RFID reader because of its ability to integrate with a wide range of other applications.

This included Depco System's software application called Asset Trail-intelligent Store, which monitors, controls and tracks tagged jewellery.

Each piece of jewellery in the shop is fixed with a passive RFID tag before being placed on display.

The RFID tags carry stored data and use radio waves to automatically identify items.

Motorola XR480 RFID readers are installed within the shelves, at the entry and exit point of the shop, and in front of the safe door.

A complete system including the hardware, the Asset Trail application and the integration with existing proprietary ERP software, was customized to monitor, track and control all items within the store based on company policies.

The system reacts and responds to the behavior of employees, and alarms alert the manager if company policies in handling goods are not met.

To further improve security measures, each employee is issued with an RFID badge which is used to log their activities on the main server and enables them to access the jewellery without setting off any alarms.

The system is programmed to give Jade Jewellery employees one minute to transfer an item of jewellery from its case to the customer display tray or any other display.

When a mobile display tray is put on the viewing table, it is monitored by an antenna installed in its mid section until it is returned back on the shelf or display case.

Any abnormal behavior in handling the goods while executing operations such as sales, transfers, consignments or safe replenishment will set off an alarm.

At the end of each day, the employees initiate a process in Asset Trail-Intelligent Store which notifies the system the goods are being secured in the safe.

The Jewellery is put on the POS table where the system identifies and commits the goods being transferred to the safe.

The system validates the committed goods going into the safe with a dedicated antenna in front of the safe door, confirming the transfer before being cut off as the safe door is closed.

Additional services, such as the transfer of items from one shop to another, consignments, and returns from clients, are all tracked by Asset Trail using the RFID readers.

The Benefits: RFID Improves Business

"Since implementing Motorola's RFID solutions in January 2008, there have been no internal thefts, providing Jade Jewellery with an ROI of approximately 400%."

said Mrs. Sukaina H. Mackie, Owner, Jade Jewellery.

"Prior to implementing DEPCO Systems RFID solution, missing items would go unnoticed until a month or two later. Periodic inventory done manually usually took 2-3 working days to audit all stores, costing valuable company time and resources. With the new RFID system, it takes about 10 minutes to audit the entire stock."

With the help of the Asset Trail Intelligent Store application, Jade Jewellery is able to track all processes and activities relating to managing a profitable retail business.

"Because we work with very expensive pieces of jewellery, the company cannot risk losing any of its pieces by internal or external theft and therefore we needed top security, tight in-store management and a monitoring scheme we could depend on."

continued Mackie.

"Motorola's RFID solution together with the Asset Trail Application has met all our concerns and enabled us to grow our business."

Additional benefits include screen reports showing in-store goods activity.

This will capture the customer behavior, tastes and preferences towards the selected jewellery.

Jade Jewellery can now clearly and quickly establish the type of goods that are popular with customers per store; this helps the team as they select which new lines they should introduce when ordering new stock from suppliers, which can reduce stock turnaround time.

"By giving Jade's management the ability to track sales, and employees' activity inside the shop, performance bonuses can then be justified based on exerted efforts to close a sale with a new customer or an existing one." said Mackie.

"The RFID implementation has made Jade Jewellery the first and only "intelligent store" of its kind in Saudi Arabia. The RFID system monitors our daily operations in real time and allows us to apply company policies in handling goods, which has greatly improved our operational efficiency. We are looking to implement this system in all our stores following this successful pilot project." Mackie concluded.

As a result of the successful implementation, Jade Jewellery is now looking at additional ways to improve their systems.

The team is investigating solutions to make the current RFID hanging tags more resilient and tamperproof, as well as creating a mobile solution for road shows.