More money maybe walking out your door than ever before. As we are currently facing a global economic crisis, retailers need to brace themselves and re-examine and re-evaluate their loss prevention strategies and systems especially in regards to shoplifting and employee theft. Loss prevention experts agree that skrinkage has increased and is expected to continue to drastically increase as a result of the current global economic crisis. This has already been the case in Great Britain and Australia where retail shrinkage has increased by more than 50% in the last year and both the US and Canada......... Read More:
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Global Economic Crisis equals more Theft
There is not one simple solution for reducing retail loss. Although in some cases anti-theft devices such as CCTV's or EAS systems can be helpful. These anti-theft devices often give the retailer a false sense of security and should never be sole relied upon. Most thieves know how to out-smart even the latest of todays sophisticated systems. With the assistance of the internet, todays shoplifter is more sophisticated than ever before. In most cases retailers need to evaluate if the expense of these systems justifies the losses incured. Retail outlets with existing anti-theft surveillance systems should make certain they work properly and all security systems should be used in conjunction with a well trained staff in shoplift prevention in order to achieve maximum protection. Learn more about Loss Prevenion Training Programs
In some retail outlets the common means of dealing with losses is the employment of a Loss Prevention Officer (LPO). This is not considered without its problems. Many retailers are discovering that LPO;s are having a limited effect on shoplifters. Many shoplifters are easily able to recognize an LPO and simply move to a different section of the retail floor to preform their crime or return to the premises when the LPO is not present.
Problems with standard Retail Loss Solutions
.......................Many of the thieves we interviewed said that stealing from an easy target was virtually effortless, and the retailer did not have a clue of what was occurring under their nose. When we asked the question “What is considered a tough target that would discourage them from stealing within the establishment”? To my surprise only 40% of those interviewed stated that anti theft devices were the greatest deterrent. A full 60% viewed security systems as something relatively easy to outsmart and often gave retailers a false sense of security, which again often gave the thief a distinct advantage.
I know what you are thinking --- not my employees, they would never steal from me. Well I have some disturbing news for you. If you have employees there is a very good chance at least one of them is stealing from you. According to the Association of Certified Fraud examiners, the typical business will lose an average of 6% of revenue from employee theft. The frequency of internal theft as compared to external theft is slightly lower, but the loss per incident is much higher as it can often occur over a period of time. The Retail Council of Canada estimates that 1/3 of “inventory shrinkage” is caused by internal theft. This translates to more than 1 billion lost dollars among retail businesses. How can you minimize internal theft? Learn More
Providing Professional Loss Prevention Advisory
and Training Services to the Retail Sector
In a recent study it was suggested that a staff well trained in shoplifting prevention may be even be more effective in reducing theft than many expensive anti- theft devices. It appeared that the retail outlets where all staff members, managers, full time employees as well as part timers receiving training, were able to reduce shrinkage by as much as 70 percent. This is considered a significant reduction considering that many anti-theft devices including EAS systems will only stop up to 60 percent of shoplifting theft.
We certainly are not suggesting that you remove your existing security system. We are suggesting that you re-evalute your currrent system expecially during the recent increase in shrinkage due to the economic downturn. With todays shoplifter being more informed than ever before the best strategy to minimize losses is a combined effort. A good updated security system is certainly effective in reducing theft. But to even further minimize shoplifting as well as employee theft we highly recommend that you compliment your current system with proper staff training in Shoplift Prevention. This is considered a wise and inexpensive method of reducing retail Shrinkage
If you are a retailer who does not currently have any anti theft security devices, or does not have the financial resources to install an effective system. We then highly recommend providing all staff members with Shoplift Prevention Training. This is considered the most cost effective method of reducing both internal and external losses. Considering that most retail businesses will experience losses of between 1% and 8% training is a wise investment that will help protect profits from walking out your door.
Media Release:
Training More Effective Than Sophisticated Anti-Shoplifting Devices
Strategies to Reduce Retail Loss including Shoplifting and Internal Theft
Top Reasons Why Shoplift Prevention Training is Effective
Reduce Shoplifting and Retain Profits
The average retailer will suffer retail losses due to shoplifting and employee theft of between 1% and 8% of annual sales. Generally the type of business, the level of security, the level of inventory control and level of employee training determines the amount of losses that a retailer experiences. The FBI, RCMP and most police agencies are reporting that shoplifting is the fastest growing crime.
Staff Training may be as effective as Anti-Theft Devices
A recent study by the Institute of Retail Loss suggests that a staff well trained in shoplifting prevention may be more effective in reducing theft than many expensive anti- theft devices. It appeared that the retail outlets where all staff members, managers, full time employees as well as part timers who received training, were able to reduce shrinkage by as much as 70 percent. This is considered a significant reduction considering that most anti-theft devices will only stop up to 60 percent of shoplifting theft.
Shoplifting Increasing due to Economic Crisis
The Global Economic Crisis is believed to be behind the skyrocketing increase in most forms of retail loss, especially shoplifting and employee theft. There has already been a significant jump in overall retail shrinkage in both Great Britain and Australia, India and South East Asia over the last year and now Canada and the US are beginning to notice a similar spike in losses.
Keeping a competive edge
Many businesses that experience retail shrinkage simply pass on the losses onto their customers in the form of higher prices. Some stores charge 5 to 7 cents per dollar to compensate for the retail shrink. With higher prices this makes a retailer a great deal less competitive, which can spell business suicide especially during an economic downturn.
Reduce the Risk of being Sued
More and more businesses are concerned about being sued by a shoplifting suspect. This now is becoming a legitimate concern as a growing number of retailers are being sued by shoplifting suspects for improper apprehension, and/or false arrest. It is important to note that it is not uncommon for businesses or insurance companies to settle questionable cases out of court for between $5000 and $10000.
Stop Employees from looking the other way.
In a recent survey it was determined that approximately half of all retail employees admit looking the other way during a shoplifting incident. It is believed that most untrained employees are too apprehensive to deal with a shoplifting suspect. Training helps to make an employee more aware and at ease about how to deal with a variety of incidences.
Reduction in Internal Theft.
A staff trained in shoplift prevention has been shown to help reduce employee theft as well as shoplifting. It gets employees involved in the overall process of theft reduction and some psychologists believe that this involvement gives the employee a sense of responsibility. Employees will tend to police themselves more effectively. It also sends a clear message to every employee that the retailer takes shrinkage very seriously and is proactive.
You will often hear the term “Shoplifting is a Victimless Crime”, this certainly is not necessarily always the case. With the rise in shoplifting there has become an increase in violence towards retailers and their employees. In some cases these are verbal assaults but in a growing number of cases it has become physical. Retailers need to recognize a potential danger to personal safety and take the appropriate action.
I challenged a friend who owned a Health Food / Vitamin Store to an experiment. Over a three day period an accomplice and I would try to rob his store blind. The owner was confident that his staff was alert and he had some good anti-theft devices. Equipped with special “booster bags and packs” we walked into the premises on two different occasions while the store was understaffed and relatively busy. Virtually unnoticed we stuffed the packs and bags with various items, purchased a handful of items and quickly slipped out the door.
Shoplifting is very common in the grocery stores, especially now that most stores have expanded to carry much more than just your stable grocery items. The combination of higher end consumer items combined with relatively low levels of security make it an ideal target for shoplifters. With tougher economic times it is projected that theft both internal as well as external is expected to dramatically increase. With small profit margins grocery stores need to seriously consider the prevention of shoplifting as a key component in reducing losses.
Shoplifting along with employee theft has become big business. In a number of cases, storefronts have been set up for the sole purpose of reselling shoplifted items for huge profits. In other cases shoplifters as well as grocery store employees have made arrangements with unscrupulous restaurants to supply them with stolen merchandise, primarily meat products for a cut rate price. Meanwhile other shoplifters have gone into business for themselves selling a variety of shoplifted items on one of the many online auction sites
To better understand shoplifting and to minimize theft in general, we closely worked with various law enforcement agencies, the security industry and various retail organizations. We also interviewed almost 300 shoplifters in order to get a very different perspective into shoplifting. Our intention was to understand a thief’s way of thinking and to learn more about the “tricks of their trade”. We then compiled this information and developed a highly effective shoplift prevention training program. What is truly interesting is that the interviewed shoplifters were very open and provided us with an incredible amount of valuable information that all other resources were unable to provide.
The FBI calls employee theft “the fastest growing crime in America!” and the U.S. Chamber of Commerce estimates that 75% of employees steal from the workplace. But it is possible to reduce the incidence of employee theft by following some simple tips.
Shoplifting and employee theft cost the retailer a great deal in lost profits and everyone including the consumer pays for this crime. Unfortunately retailers often underestimate the actual figure in terms of losses. Unless a business has strict inventory control it is simple to come up short in getting a good sense of overall losses. There is a basic formula for calculating total annual retail losses in your business, which will give you a fairly accurate idea of how much profits are actually walking out your door.
