How Would You Solve “The Case of the Vanishing Memo”? See What Our Readers Say

AURELIAN & CO., A REGIONAL fine jewelry chain with six locations, relied on a seamless flow of its inventory, managed centrally from their flagship store. The tech-savvy owners utilized a current POS system to track each piece, creating a virtual inventory ledger that ensured clear visibility of all stock across their network. This allowed for efficient orchestration of diamonds and special customer requests between locations.

Their newest store, still building its clientele, carried limited inventory and depended heavily on the flagship location to fulfill memo requests quickly and accurately. Johanna, the store manager at headquarters, oversaw these operations. At the new location, her counterpart Daniel relied on Johanna’s team to support key appointments by ensuring the right inventory was available on short notice.

One such request arrived when a significant appointment was scheduled at Daniel’s store. He had a client who was seeking a large diamond to set in a custom solitaire bezel necklace, a high-value sale with considerable potential for creating a long-term customer.

Daniel personally relayed the specific cut, clarity, and carat weight requirements to Johanna. She located a suitable $10,000 diamond, and upon its arrival from the supplier, Johanna personally handled the intake, with careful physical inspection against the packing slip, followed by immediate entry into the POS system, its ownership temporarily assigned to Daniel’s store.

Unfortunately, the client ultimately decided not to move forward with the purchase. With the appointment concluded and no sale finalized, Daniel’s inventory manager, Elena, initiated the return. The diamond was marked “transferring” in the POS system, destination: headquarters. A transfer document was auto-generated. Two days later, the diamond was packaged and included in the regular inter-store shipment.

At headquarters, the package arrived. The receiving team, typically Jason or Priya, handled delivery. Per protocol, they were supposed to log the FedEx tracking number and their initials in a handwritten shipping ledger and digitally confirm receipt in the POS system under their individual login. The system tracked both the item’s movement and the identity of the person logged in during the intake process.

From a digital standpoint, the return appeared complete: The system showed the diamond received and placed back into HQ inventory. But 90 days later, Johanna received an email from the vendor requesting either the return of the diamond or payment in full.

This prompted an internal search. Johanna checked the memo return drawer, but the box labeled for the $10,000 diamond was empty. The POS showed it was transferred and received, but the physical stone was missing.

The team then checked the manual shipping log. There was no record of a package received on the date the transfer was supposedly completed. No initials, no tracking number.

According to the POS system, the diamond’s return was logged under an administrative account, not under Jason’s or Priya’s login — except that admins didn’t handle physical inventory. This raised more questions: Did Jason or Priya mistakenly remain logged in under someone else’s credentials?

To verify who actually received the diamond, Johanna turned to their security footage, but the company’s 60-day video retention policy had already overwritten the footage.

The POS system showed a return, but under the wrong login. The manual log was blank. The diamond was gone. Was it human error? System misuse? Or something else?

The vendor still needed answers. The lingering question remained: Where was the diamond and who was responsible?

William J.
Seven locations in AR and TN

The first step is accountability. Tie your inventory security to incentive pay/commissions or whatever your structure is. Make it a team effort. Install a loss allowance and anything over that affects incentive pay across the board. The rules need to be fair for both the employees and the business.

Using a POS system like the EDGE, you should be able to get security logs on every piece of merchandise wherever it was moved. You need to make a serious effort at making sure users have the appropriate permissions and that each person is clear that it’s unacceptable to share logins.

When you have a piece missing, go straight to the logs, the person, and then the cameras.

Checks and balances. You need to come up with a system that removes temptation. Have multiple people receive the email, one compile the RTVs and one sign off. The more people that get involved, the better. You also want to audit your invoices and RTV goods to make sure that is covered. Anywhere you can move inventory out of the system, you have to watch like a hawk.

Never just have one person doing any part of inventory.

Susan E.
El Paso, TX

Memos have their positives and negatives! As a first-generation jeweler, I learned memos need to be dealt with differently than paid inventory. It has always been my protocol to have as few salespeople as possible handle the memos, with only one person in each store logging them in and out. Had there been one person in charge at each store, this would have solved the responsibility issue. While digital procedures keep things clean, there is nothing better than a physical signature whenever something is received by someone. This is a way to have a “Plan B” in place and to keep everyone aware of where the memo is. Private login codes can be misused or divulged. It’s wise to have a special place in the safe for memos and “inventorying” them monthly.

Denise O.
La Grange, IL

1. Enforce protocols like your profit depends on it. Because it does. Lock admin logins for system settings only — not inventory handling. Receiving should always be tied to individual logins with time stamps. If someone “accidentally” stays logged in under Admin, that’s not an accident — it’s a liability. 2. No cameras? Cue the paper trail (and a little digital rigor). When the footage is gone, all you’ve got is your logs. Make them airtight. Shipping/receiving checklists signed in real time, cross-verified by another staff member, and photographed or digitally scanned. Add surprise audits. Trust is lovely — but documentation pays the bills. 3. Memo returns deserve red-carpet treatment. Create a simple, universal rule: no returns without confirmation from both ends. A digital “handoff” checklist, signed and uploaded with tracking info, plus a follow-up once HQ confirms physical intake.

Babs N.
Bozeman, MT

“Tech-savvy” ownership aside, even the digital systems with the greatest detail built into them are still subject to problems where theoretical exactness clashes with imperfect humans. And imperfection can take all kinds of forms: moral slippage (theft); “efficiency at all costs” (corner-cutting); and plain human error.

I would work with the entire staff to discuss the ins and outs of their current solution. Where are the sticking points that make a user want to cut a corner that could result in loss? Do they see a possible loophole in how the system works that could leave an opening for something to disappear into the void? Are there certain everyday tasks that should not require admin oversight, that would make it more likely for an admin to just casually provide their password to staff? Letting admins know that they will be held responsible for actions done using their login should spur on some honest feedback on why/when admins give out their logins on occasion.

Jose M.
Macula, GA

Aurelian & Co have their inventory under control, but they discovered a flaw in their system. Time-sensitive login is what I would recommend. Users would be logged off by the system after five minutes. All merchandise should be scanned into the system log with a timestamp photo, and there shouldn’t be a written log. I have no doubt that the system could be configured to snap a photo of the associate upon pressing the enter key. This prevents anyone from using the login of another associate. Now, as to getting a call from the vendor after 90 days of keeping the diamond: Who is this vendor? I usually get a call three days later, LOL.

Someone at the company should oversee memo goods and keep on top of store associates to sell or return. Like I always say: This is not cotton-candy we are playing with.

Jennifer F.
Colorado Springs, CO

1. TRAINING teams and having a step-by-step guide for process so when errors happen it’s easy to find where in the steps things went wrong. Also having tech that can differentiate capabilities by team member (with a timed logout so no one can use someone else’s credentials). 2. ACCOUNTABILITY falls to management and back to step 1. If a team isn’t properly trained it is not their fault. They don’t know what they don’t know … keeping in mind that mistakes can still happen. 3. DIGITAL COMMUNICATION is critical to having a log of who/how/when things are moving. My entire team keeps record of memo items that are moving from place-to-place via email and text on the store’s cellphone. This puts the information on everyone’s radar.