An Accurate, Successful Inventory Is Not Due To The Luck Of The Irish

How does Notre Dame’s football team manage to maintain a top program year in and year out? Is it the Luck of the Irish that does it? No, they field a competitive team by working hard and preparing for the upcoming season. As we enter March we think of spring and St. Patrick’s Day and the Luck of the Irish and lucky four-leaf clovers and all of these things. In retail, we also think about store inventory time and how the results will come out this year.

     If you are counting on the Luck of the Irish or just plain luck to get you through inventory and wind up with successful results you need to get a better plan. Obtaining inventory results that reflect a healthy, robust business starts well before the inventory date. While it may include the preparation time several weeks in advance of the actual day/night of inventory counting the real work begins when you start your shortage action plan.

     If this is the first inventory for your store you will not have a measurement or prior inventory as a baseline for what you will be up against. I would suggest that in your case you measure your store against the national shortage average OR you measure it against the national shortage average for your type of retail business. According to the National Retail Federation 2018 National Retail Security Survey, shoplifting accounted for 35.7% of losses while employee theft accounted for 33.2%. Loss Prevention Systems, Inc. personnel are well-versed in shortage and can be a helpful consultant to you in this area. For those who have inventoried previously you want to lower whatever the prior year shortage results were for your store. Obviously it would be fantastic if zero shortage could be counted on year in and year out but the fact of the matter is very few stores will come in at zero (I have seen overages but those always offset the next year due to poor counts or paperwork errors).

     So where does one start in their planning? First you have to look at your anti-theft strategies. With nearly 70% of the shortage attributable to theft you can take care of a big chunk of shortage by addressing this issue. Is your store using electronic article surveillance equipment to deter and prevent shoplifting and even employee theft? If you do not have an electronic article surveillance system in your first assignment is to get one. This includes the towers, tags, and even integrated cameras. Don’t use second-hand equipment or an off-brand system in your store. Using a name brand solution from Sensormatic is the best option and it is more affordable than you may think. Again, Loss Prevention Systems, Inc. can guide you into the best solution for your business no matter how big or small it may be.

     You then need to take a look at the other areas that impact shortage, operations, vendor shortage and a small portion which is undefined. Looking at each of these aspects can be time-consuming because there is so much that can impact each one. If you have managers working for you they should be looking at how shortage could be happening in their departments and present solutions to address them. That information then goes into a master shortage plan. If you are lucky you will have a team that knows where to look for shortage opportunities. If you don’t have that kind of luck or if you are the only manager for your store you are still lucky. Loss Prevention Systems, Inc. can work with you to conduct a risk assessment and identify vulnerabilities and devise plans.

     Finally, once your anti-theft system is up and running and your shortage action plans have been created you can spend the month prior to inventory prepping the store. There’s no magic to it, it is a detailed preparation to make sure every piece of merchandise is properly tagged and ready to be counted. Inspections of nooks, crannies, shelves, underneath base decks, on top of fixtures and in supply closets to locate items that have migrated where they should not have can add dollars back to your inventory.

     Four leaf clovers, lucky charms, wishful thinking nor luck of the Irish are going to get you a successful inventory. Theft prevention, careful planning and advice from people who have been in the Loss Prevention field WILL result in successful inventories. Follow this advice and find your own pot of gold at the end of the inventory rainbow.

To Prosecute Or Not – The Ball’s In Your Court

Does it matter whether you prosecute shoplifters? There are some retailers that will not prosecute a shoplifter if they catch them. Many retailers discourage their employees from following someone outside to get a vehicle description or license plate number even if they know someone stole from the store. Then there are the retailers that will allow managers to approach someone who is suspected of shoplifting. What is the best approach to addressing theft? Have you thought about why or how you approach the issue of theft?x

Why would a retailer catch a shoplifter but then not prosecute them for the crime? There are several reasons a store owner may choose not to charge a shoplifter if they do catch them. 

  • When a shoplifter is caught and sent to jail or in some cases a citation to appear may be presented, the store manager or person who caught the shoplifter has to go to court. This can be a time-consuming prospect. There are jurisdictions where the person who filed a complaint or prosecuted a shoplifter will be prosecuted themselves if they fail to appear in court for a case. 
  • Some store owners will use the promise of not prosecuting a crook if the merchandise is returned. The owner is more interested in getting their product back than what happens to the thief.
  • There are managers who do not prosecute because they feel badly for the shoplifter. They believe that consideration of the person’s circumstances is an appropriate response to an offender. For example a person may say they shoplifted food because they are hungry or they stole clothes because they are homeless or needed them and could not afford to purchase them.
  • There are situations when a store manager takes age into consideration. The apprehended party may be (or claims to be) a juvenile giving an age that falls into that state’s age bracket for juveniles. The manager may feel they are doing a favor by not marring the youth’s future opportunities with a criminal record. A manager may also feel sympathy for an elderly person because of advanced age or possible mental deterioration.

Each of these decisions has some merit on their own. There is nothing wrong with feeling badly for a person or their circumstances. There can be some ramifications that result from releasing someone who has been caught shoplifting if you are not careful. 

     Consider what happens if you decide not to prosecute someone and they leave your store after you have detained them and they were to be injured. I am always especially cautious when the party is identified as a juvenile. Anytime you are dealing with a child you have to be careful. If you choose not to contact the police after stopping someone, even if you retrieve your merchandise what proof do you have that you recovered anything from that person? Is there a chance you could be falsely accused of unlawfully detaining that person? Even if you do recover merchandise and no issue transpires, without a police officer being present to hear you tell the person not to return there is no documentation of the incident. Nothing prevents that shoplifter from returning to your store again. 

     Catching and prosecuting shoplifters does carry its own risks and headaches. Sometimes there are just no easy solutions. One thing you have to be very cautious of is inconsistency. If you prosecute one person and not another person are you at risk of being sued for discrimination? Could someone say you gave preferential treatment based on age, race, gender or any other factor because it was learned you previously allowed a break to other people?

     If you are going to allow managers to stop people for shoplifting it is crucial that they have received quality training on how to do so safely and consistently. Be certain not to allow any behavior that would endanger your employees and do stress that they are allowed to make decisions based on how they feel about their own safety. If they believe a shopper is stealing but the person’s behavior is threatening or intimidating in some manner trust your managers to back off or if it is serious enough to contact police. 

     No one can tell you the best approach to dealing with shoplifters. Ultimately it is your decision to make. What I can say is that a store with a focus on customer service and a strong retail anti-theft strategy can deter the vast majority of shoplifting and eliminate the need for prosecuting shoplifters because they will leave the store empty-handed.  

Sensormatic Systems Value

We just came back from a trip to Sensormatic Systems Head-Quarters in Boca Raton, Florida. What a fascinating, interesting and eye-opening experience. As anti-shoplifting systems are concerned, we clearly left with the knowledge that Sensormatic is the top of the line for value and quality. I have been in the field of Loss Prevention for over 35 years (I hate saying that, it makes me feel …. old). I rose to the top in a number of fine retail companies as the Director of Loss Prevention. I have had my own company now for many years. So, I have bought these systems as a Director and I now have the privilege of being a premier nationwide Sensormatic Dealer. For many years we sold another top brand. But it is very clear to me why Sensormatic is the world-wide leader. Let me throw out a few conclusions for you. 

Sensormatic invests a huge amount of money into testing. Not just making sure that systems ring the bell and flash the light. Testing is extensive. Research laboratories are used by Sensormatic Engineers to take something from an idea to a finished product. It starts with a team in design. They look at style and how it will impact the Retailer and their customers. Ergonomics are tested thoroughly. It is important that a retail employee can use a hand-held device for long periods of time with minimal fatigue. Drop tests are performed with high speed cameras to determine if devices will properly survive a fall with minimal damage and a low risk to the people around it. Stress tests are conducted on antenna systems to see how they will react to being bent until broken. Do the systems splinter? Does the electronics spark? 

Sensormatic is a massive company that operates on every continent, okay, well maybe not Antarctica.  Sensormatic Systems is part of Johnson Controls. And if you have not been hiding under a rock all your life know that Johnson Controls is one of the largest companies in the world with a serious reputation for quality and service in many fields. The Sensormatic division has that behind it. 

That is in addition to the testing of the antenna systems for detection of tags and labels. Sensormatic systems are tested and certified safe by the main testing agencies in the various countries all over the world. For example, in the United States Sensormatic systems are UL Certified among others. 

Sensormatic security systems are not going to be the cheapest. But it is like anything else you get what you pay for. However, the value runs deeper than just the highest quality commercial grade equipment that is made to last a very long time. These Acousto Magnetic (AM) systems perform much better than the competition for the price and much better than Radio Frequency (RF) systems. RF systems are very prone to false or phantom (no one nearby the system) alarms. Acousto Magnetic does not have that problem. This technology operates on a different frequency that is less prone to issues. Because of that we can easily get an 8 foot isle width. The very best RF can do is 6 feet.  

Acousto Magnetic technology has been around for over fifty years. It is proven and stable. Sensormatic brand hard tags and labels are very robust. The hard tags have clean, well “welded” seams that will not snag clothing. The genuine Sensormatic labels outperform any knock offs in both range and deactivation. Sensormatic security system deactivation performs at a very high level. When your cash/wrap associate kills the labels, it stays dead.  

So, the real question now is this: Are you going to go through all of the coming up year and again lose money, watching it walk out the door with shoplifters? Or are you going to fix the problem once and for all? Loss Prevention Systems’ proven process will significantly reduce your losses? All you have left to do now is contact us. 

Proper EAS Tagging Tips For Retailers

There’s no question about it electronic article surveillance (EAS) retail anti-theft devices work in every store they are used in. In fact they are so effective that according to the Sensormatic Global Retail Shrink Index, EAS is the most popular Loss Prevention and Asset Protection investment among retailers in the United States. 92.16% of retailers surveyed indicated they are investing in electronic article surveillance (pg. 45). Is it enough that EAS tags are used or is there more to making them an effective tool? 

     In order to get the most out of an electronic article surveillance system tags retailers should ensure they have effective tagging guidelines in place. It may not seem like it would make a big difference at first glance but the reality is a proper tagging program can make a theft prevention program stronger. Here is are some suggestions to consider as a guideline of where you should tag your merchandise: 

  • Keep visibility in mind. While hiding tags may seem like a good idea at first it can cause some problems for the retailer rather than a thief. Hidden hard tags may not be seen by a cashier and removed when a piece of clothing is purchased. That can cause an unnecessary EAS tower alarm and an embarrassing moment for your patron. A similar problem can occur with an EAS label if it is hidden. It may not deactivate properly at the point of sale and cause a false alarm. 
  • Location of tags is important to prevent concealment by a shoplifter. If a pair of pants is protected with a hard tag on the waistline it is not difficult to untuck a shirt and hide it. Keeping the placement where the tags are hard to cover improves the deterrent effect of the devices. 
  • Another thing to avoid is placing soft tags or labels on manufacturer hang tags if possible. I encourage retailers to place labels directly on merchandise packaging. For example a Sensormatic label is difficult to remove from a box of razor blades but if it is on a hang tag on a shirt sleeve a crook can pop the hang tag off and the label goes with it.  

So what do I suggest when it comes to tag placement? Here a few suggestions that I have found to be effective: 

  • When tagging pant or slacks a hard tag can be pinned through a seam near the knee. If that is a bit more work than you want to do, the next best solution would be a couple of inches above the cuff. Both solutions make it difficult to hide the tag and if the location is consistent on every pair of pants cahiers will be accustomed to looking for hard tags in the same place every time. 
  • If your store sells shoes people are going to want to try them on. I suggest tagging them through an eyelet. If there is no place to that a hard tag can be attached the next best solution would be a label on the bottom of the shoe. Tag both shoes as an extra precaution against shoplifting. 
  • Shirts should be tagged near the front of the neckline. The next best option would be the cuff of the shirt sleeve. The point is to keep the tags in as visible a location as possible. The problem with a cuff versus a neckline is that a cuff can be upturned and a tag hidden. Also when a tag is placed too close to the end of a cuff it is easier to make a small cut in the garment to remove a tag and repair it with a stitch or two. 
  •  Purses can be protected with a hard tag. If you are tagging purses the key to doing so efficiently and reducing customer distractions is to tag them as closely as possible to one place for all bags. Wallets may have an EAS label hidden inside because they are more difficult to tag with a hard tag. If this is the case for your store make sure cashiers are all aware of this and carefully placing the merchandise on the deactivation pads at checkout. 

These are the most common items of clothing and softlines merchandise to be protected. Hopefully the message you are reading is that the consistency of a tagging program is what matters. Do it properly and you will have minimal false alarms and customer distractions and the alarms that do go off will be real attempts to steal. When supervisors and employees respond to real alarms and fewer false alarms they will be more thorough in their receipt checks. That will result in more recovered dollars and less shortage for you. 

How Does Your Leadership Style Impact Your Store?

Leadership. It varies from person to person and company to company. As a business owner how you lead your team impacts the overall health and prosperity of your store. Does your team work for you and follow direction out of a feeling of obligation or fear? Do your employees do what they are told to do because of a concern that failing to do so could result in the loss of their job? If this is the feeling of the store associates they may not be doing more than the minimum to get their jobs done. This affects customer service and how employees interact with patrons. Poor service results in poor sales and inefficiency in operations. Leadership is as important as customer service and I would argue the two go hand in hand. I cannot think of a customer service driven business where the delivery of customer service thrived when the managers were loud, bossy or came across as distant.  

     Personally I have attempted to incorporate in my own management style a mix of a couple leadership influences. One is advocated by John Maxwell. The first book of his I read was, “The 21 Irrefutable Laws of Leadership”. In his book he lays out what he describes as 21 principles that apply to leaders. There were a couple of his points that I made a conscious effort to apply (some were already an integral part of who I am) when I was leading my Loss Prevention team, my freight unload/ stocking team and as a Manager on Duty. Two of the characteristics Mr. Maxwell lists, “The Law of Solid Ground” and “The Law of Empowerment” are dimensions I believe can make a major shift in how a store team functions. The first idea is that people have to trust their leader. As a leader do you follow through on commitments to your team? Do you treat every person equally and fairly and do you provide honest feedback even when it may be difficult? The second is that strong leaders are not afraid to give power to others. As you empower your team to make decisions you build their trust in you and you are developing them into leaders. This means you train your team, set expectations and as they are learning, you correct and provide recognition to them.  

     Another leadership style I embrace is servant leadership. This manager is the leader who leads by the example he/she sets. It is also a manager who invests in the development of others. I have incorporated this in the course of my careers. Rather than ask a team member to clean up after a child has been sick in the store I have done it myself. As a freight team manager I frequently came in on a day off to help my team unload a truck and push freight. It is the willingness of the leader to be seen doing the unpleasant tasks alongside the rest of the team. A 70 foot trailer gets awfully hot and humid in the south during the summer. When your team sees you willing to get in that trailer first and rotate others out to avoid exhaustion they are willing to work harder to get the tasks done. Servant leadership does not mean supervision does not take place or that discipline is not occurring. It only means that the manager/supervisor attempts to be empathetic to situations where discipline may be required. These leaders do not allow themselves to be doormats but do look at individual circumstances when the situation warrants it. Think about how an employee is likely to respond to this manager as opposed to the heavy-handed supervisor who gives orders and barks directions.  

     Leadership styles directly influence the way a business operates and how employees function on the job. Yes, you can be the owner and expect workers to do what you tell them to do, but it won’t foster a happy workforce. A leader who cares about the staff helps in their development and empowers them to make decisions will get far better results than the other leader. As customer service improves, productivity improves and the atmosphere of the building is one where shoppers enjoy spending time. It also creates a customer-focused climate where sales associates are actively engaging clients and that leads to a reduction in theft. Happy employees are also less likely to steal and that can impact up to 30% of where shortage traditionally takes place. 

     Evaluate your leadership style. Are you leading the way YOU would want to be led and are there adjustments you can make that can enhance nearly every aspect of your business? Leadership determines how successful your store can be. 

An Attitude Of Service Or Just An Attitude? Attitudes Affect Customer Service

This is going to seem a bit odd to some of you but I want to know if you have an attitude? Store owners, do you have an attitude? Store Managers, do you have an attitude? Has anyone taken a look at the attitude of their employees? EVERYONE has an attitude, the statement isn’t necessarily a negative it can be positive. The problem is we have grown accustomed to thinking of it with a negative connotation. Why is that? Because in some form or fashion we have adopted the idea that an “attitude” shows our independence or ability to be self-reliant regardless of what others think. At times it can be very course and abrasive to others. If that is your “attitude” how does that relate to your customers, or those who work for you? I would like you to consider for a moment that an “attitude” may look more like a chip-on-the shoulder than some sort of independence (in some cases if looks like a boulder more than a chip).

     An owner with a poor attitude makes the job more difficult for the managers who work for her or him. The “I’m the boss” temperament may be unstated but if that is how an owner thinks it can reflect into how they give direction and interact with their managers. It frequently means that no one else can have a better way of doing things and leads to a stale operation. I will also tell you that the negative attitude rolls downhill.  The way you interact with your managers will be reflected in how they interact with the store associates and they, in turn, have attitudes with the customers. I have seen it in action and I can tell you I have experienced it and have allowed it to impact my interactions with my team in spite of my best intentions. By the end of a workday, everyone leaves in a grouchy mood. 

     The attitude of the owner affects the attitude of the managers has a direct impact on your customers who don’t have to shop at your store. I happen to work for a company that has two stores in the immediate area. On more than one occasion we have heard comments from customers that they don’t like to go to the other store. They tell us the customer service is poor and the employees are not friendly. On the other hand the manager of the store where I work makes a point of telling the managers they are to do whatever they can to keep customers happy (within reason and without violating policies). Employees may get busy but they enjoy working for this manager. The atmosphere is welcoming and we make every effort to greet our customers and offer assistance when they walk into the building. I have gone into the other store and the climate is different. If a greeting is offered it is more of an obligatory hello that a genuine one.  

     What is the climate in your store? What do your managers and employees think about your management style? If you aren’t concerned think again. If your store employees are providing poor customer service to customers because of the treatment they receive it as a direct impact on sales and a direct impact on theft prevention. Shoplifters who have been interviewed have said that they target those stores where employees are unhappy. They don’t have to worry about someone trying to give them too much attention. If shoplifters aren’t receiving service, neither are your customers and that means no one is trying to sell let alone up-sell for a store. 

     Customer service starts with leadership. When the management team seeks to make the climate one where employees enjoy coming to work that attitude will be reflected in the interactions between workers and customers. Owners and managers cannot assume the team is happy. Truly anonymous employee surveys will help gauge what employees are thinking. They can also be a tool for seeking ideas about what employees might want to see done differently or an outlet for ways to improve. Happy employees make a world of difference. What is the climate in your world? Is everything great or is an attitude adjustment in order? 

Did The Grinch Steal Your Retail Christmas? 

Wow, Christmas is over and Retailers are starting to dig out from the carnage. Unfortunately, some of the carnage is all the merchandise that shoplifters have liberated from your store. I believe that theft is actually the oldest vice around. Even older than “the oldest profession”. As long are there are two things on this earth 1-people and 2-stuff, there will be theft. Well, neither is going away anytime soon. So what do we do?  

The first thing is to make the decision to take your store back from the enemy. Putting the solution off will not fix the problem and it will get worse. The second is to implement the two proven solutions. Training and a Sensormatic system. 

TRAINING – Over the past 35 years I have heard countless retailers say the same thing. “I don’t know what I can or cannot do with or about shoplifters”. Shoplifters are no different than any other business challenge we face. Attack it head-on. Loss Prevention Systems can educate you on what you can and cannot do. But more importantly, we will take you off the defensive and put you on the offense. Now I know what you may be thinking right now. “I am not going to chase shoplifters down and tackle them!”. Well, I am glad we got that out because we do not want you to do that either. We want to prevent the loss from occurring (that’s why we call ourselves Loss Prevention Systems, Inc. What a coincidence, huh?).  

Training should cover a discussion of the problem itself, the law both criminal and civil, who shoplifters are and how to spot them before they even steal, going on the offensive with customer service tactics and more. We do this live via webinar with as many of your folks as you can pull together. I have actually found that most of the time we need to do two sessions so we do not leave the store short staffed or someone misses out. Training will help give you the confidence to attack the shoplifting scourge head-on. 

SENSORMATIC SYSTEM – “So if I am trained, why do I need a Sensormatic system and Sensormatic security labels?” Great question, glad you asked that! (sorry, I am in one of those moods) Consider this, training is only half of the solution. You and your staff can be trained up in the techniques to prevent and deal with shoplifting but you cannot be everywhere at once, even in a small boutique. Shoplifters WILL create an environment where they can steal. On top of that what you will find is that some of your “best” customers are also actually stealing from you. Yes, that good customer is buying merchandise, either small inexpensive items or even more expensive ones but they are actually stealing other merchandise in addition to that. And because they are a “best” or frequently seen customer less attention is paid to their activities. They are kind of a fixture, they hang out a bit, joke with the staff, ask questions and then…. They are simply not observed because “that’s just Sam or Wendy, they are really nice”. 

So to handle all that you will find that a Sensormatic system is actually cheaper than additional payroll. In addition to that, the Sensormatic system never takes a day off, does not call in sick or no show. The Sensormatic system is working 24/7. Actually, many of our systems actually power themselves down after you close to save on your energy bill. They automatically wake themselves up when you come in the next day. 

A Sensormatic system has two benefits. It sends a message to the thieves (real customers do not care) and prevents losses. And, of course, the tags and labels are actually protecting your merchandise and bottom line. 

So there are no more excuses. Make this year the best yet for sales you make and actually keep the margin make on the bottom line. Grinch, GO AWAY! Contact us today. We can make both Training and a Sensormatic system your reality. 


A Proper Reflection Of The Past Year Can Make The New Year Even Better

It is January and you are ready to get started on your new year. What does the start of a New Year look like for your business? Are you still trying to move out seasonal and clearance merchandise? Are you preparing to trim back payroll by releasing seasonal employees? Maybe you are already thinking about inventory and what you will need to do to prepare for that day. There are all sorts of ways retail owners and managers start the New Year but I would suggest that before you look forward you take time to look back on the previous year. 

There are a couple of reasons I would suggest reflecting on what the past year has been like for the business. First, by taking the time to reflect on the year you can celebrate the store wins with the entire store team. Employees want to know how their contributions have helped the store meet goals that were set. You may have one or one hundred successes to share but your entire team has put in the work and should be given a chance to share in the successes. It can be a simple cake in the breakroom or a small in-store party but let your employees know that their efforts paid off and are appreciated.  

 Another reason for reflection is that you can evaluate what did not go as planned. This is when you pull out planning documents or action plans and look at what goals were not reached. Did you meet your sales goals? Did you make stock shortage objectives? Did you meet your employee turnover goals? If you cannot celebrate an item as a win you will want to move that to the new store action plan for this year. You and your management team will need to consider what can be done differently to achieve the goals you set and missed. This is not a 5-minute task. This will require the team to drill down to the causes that led to a missed goal and then plan how to improve it. Sometimes this can feel personal and everyone needs to leave their feelings outside the room. Approach the problem as a group and find ways to help each other with action items. 

One of my favorite tools for a New Year is what I have adopted from several workplaces, a “What Works/What Didn’t Work” session. I have seen these done by only a management team but the truly effective sessions include team members and hourly staff. The employees will often provide you with insight into problems you did not know existed. Here is an example; you may think you have a good return policy and your return desk employees are happy. You don’t see anything that indicates problems with your refund program. What you may not be aware of is that your service desk employees are unhappy because they feel that managers are not supporting them after they turn down a refund with no receipt. The managers are called when the customer is upset and the manager arrives and tells the customer they “will take care of it”. Sure, the customers are happy and the policies look like they are enforced but the service desk employees feel foolish and undermined. A “What Worked/What Didn’t Work” session can help you see how you can improve policies, services and improve morale. When you conduct one, make sure you also ask your employees for suggestions on how to improve what they think did not work. Don’t let it simply be a gripe session. It also allows you to clarify reasons some policies may be in place that employees were unaware of before the meetings. 

After you have celebrated, evaluated and set new goals you are almost ready to jump into your New Year. Make sure your goals are realistic and create plans that will be effective in achieving those goals. If reducing shortage by .5% is your goal, you may want to install an Electronic Article Surveillance system. If making your hiring process easier and reducing paperwork is a goal, Loss Prevention Systems, Inc. can help you with their Applicant Management Center. If parking lot break-ins are an issue you can request improved lighting from your property management company. If you need help in risk assessment and loss reduction Loss Prevention Systems, Inc. offers a consultation package that involves everything from an onsite visit to a comprehensive loss prevention policies and procedures package. 

Start your year off right with a look back at the previous year. Share wins, evaluate opportunities and work as a team to create plans that will lead to an even better year than last. Make 2019 a year of growth and prosperity and consider taking Loss Prevention Systems, Inc. along as a partner!


 

Resolved Or Solved? How Planning Can Make New Year’s Resolutions Work

Have you ever noticed how we all anticipate a New Year will bring new and exciting things into our lives (or businesses) but after the first month we often realize that nothing is new or improved or better? In fact, we may be disappointed as the year progresses that problems we hoped would be resolved (read, “magically disappear”) are still there. We make resolutions at the beginning of the year that are meant to help “improve” or “fix” something we know is an opportunity but then we slide back into our routines and those “problems” don’t get any better.

     In retail, those problems may involve personnel issues such as hiring and retention. Concerns may be for store profitability including expenses, sales, and shortage. Maybe concerns are over what may be classified non-controllable expenses, building rent, taxes, etc. Wishing problems away is not a solution nor is a resolution. If you want to resolve to solve problems you have you need to create an actual action plan and then take a partner(s) to stick to it, often one of your store managers or department management team. As you look at the areas of opportunity and break them down you can find that correcting one area can make a significant impact on other areas. Let me give you an example of what I mean.

e.g You identify that you have an issue with excessively high merchandise shrink.

      You need to identify all of the possible causes of the shortage problem.

  1. Do you use retail anti-theft devices?
  2. If you use a Sensormatic security system are you tagging everything?
  3. What areas are your highest shortage departments and are they vendor serviced?
    • If they are vendor serviced are you checking in and out vendors?
    • Are you improperly tossing out of date merchandise rather than receiving vendor credits?  
  4. Is employee theft causing shrinkage you haven’t seen?
    • Do you complete pre-employment background checks before hiring?
    • Do you require pre-employment drug screening?
    • Do you know the signals to look for that would indicate an employee may be stealing?
  5. Do you control your compactor and who throws out the trash and if you have a baler who is crushing cardboard?
    • Employees and vendors who are stealing and have access to a compactor will toss out the empty packages they would otherwise leave behind.
    • Uncontrolled compactors mean anyone can throw away anything that looks like trash but some small items can be overlooked and thrown away and cause a shortage.

These are not all of the contributors to a shortage. You can continue to drill down and I would encourage you and your team to do so. The project doesn’t stop there. Once you have identified the issues you need to create an action plan to address each concern. The plan should also include benchmarks or measurements that will show you are doing what you said you would do. There must also be deadlines for completion.

     There are areas that will cross over and can be beneficial to each section. Let’s say that you have focused on shortage and you also believe you have a hiring/retention problem. It seems people are going in and out like a revolving door. You have to ask yourself are you hiring the right people in the first place. If your employees keep leaving it could be they have stolen from you to get what they want and they are leaving before you catch on to them. If you start doing background checks you will be more selective in who you are bringing on your team. You may have been hiring a lot of people with criminal records or spotty work histories. Being selective and hiring the right people can also build a more dependable workforce. This leads to improved morale, more initiative and a better work ethic overall. Improving your hiring can improve shortage results due to dishonest employee activity.

     Another example of crossover would be compactor controls. Start regulating who is tossing out the trash and you impact retail shrinkage but you may also find that merchandise that was being overlooked is now being stocked more carefully. Overlooked items are getting back on the sales floor. Not only do you reduce shortage you improve sales.

     Wishing the New Year will bring improvements is no way to operate a business. Planning and follow through on those plans will bring about the positive changes you want to see. Resolve that 2019 will be a year of growth and profitable sales! Happy New Year!


          

New Year’s Resolutions That Help The Environment And Can Keep Stores Profitable

It’s 2019 and time to make some New Year’s resolutions! We all know how easy a resolution can be to make but they are hard to keep. We also know that it is just as easy to break a resolution but are there resolutions a store owner can make that would benefit the store AND benefit society? I think one resolution that would be mutually beneficial for both would be the implementation of environment-friendly policies and procedures. We are talking about sensible measures that would appeal to anyone on either side of the political spectrum. Right now there is a big push for the elimination of plastic shopping bags. There are also those opposed to going back to paper bags. What could the solution be? Try encouraging the use of recyclable, reusable shopping bags for your customers. You make those opposed to one-time use bags happy and you save money on the need to regularly purchase more shopping bags (which can be a rather pricey supply on your monthly expense report). To implement this type of change you would want to have reusable bags ready for your customers and you might even give them away for the first few weeks you start the program. After that, you might give customers a small discount to customers who bring their own bags, say 1% on every transaction.

     Problems that may arise by allowing recycled bags into the store. The first concern is the potential for increased shoplifting. Inviting customers to bring their bags into the store to bag groceries is going to make shoplifting that much easier. Thieves already walk by unattended cash registers to pick up plastic shopping bags as they enter the store. They fill them up, look like any other customer who has made a purchase at an in-store terminal and they leave. Most customers are honest but I would remind readers that one of the necessary ingredients for shoplifting is opportunity. Without opportunity, some people who may be tempted to steal for a thrill are kept in check. You provide opportunity by permitting reusable bags and some will take advantage of it. You also have to think, are the bags only allowed at the checkout stand? How do you keep shoppers from filling them up as a convenience rather than using a shopping cart? How do you monitor the shoppers for those who may be stealing and those who are simply picking up merchandise for purchase? It can lead to problems for store owners.

     There is a way to allow the use of shopping bags and minimize the risk of increased shoplifting and that is the installation of an electronic article surveillance system (EAS). If you are going to resolve to help the environment you can still do it just by adding an EAS System in your store if you don’t already have one. You tag all of your merchandise with EAS tags or labels depending on what the merchandise is or how you strategize your theft prevention procedures. If a shopper has concealed merchandise in a bag they brought in and did not pay for it the alarm is going to be activated and your employees will respond to it.

     Since we are on the topic of being environmentally responsible it is important that retailers know that many EAS tags are built out of recyclable materials. Hard tags can be used multiple times to tag and re-tag merchandise thereby saving on the need for constantly purchasing new tags and since they are recyclable they help the environment. It should also be noted a lot of Sensormatic systems help to reduce power consumption. When the systems are not in use (during non-working store hours) they go into a power saver mode. Stores save money and wasted energy. The use of EAS loss prevention equipment saves stores money by preventing theft and it allows stores the ability to appeal to their environmentally focused customers thus driving sales.

     Another environment-friendly step you can make as a retailer is to look at recycling those cardboard boxes your merchandise is shipped in. A cardboard bale can bring in anywhere from $10 to $20 a ton. If this does not seem like a cost-effective move for your store you could try partnering with a neighboring store and combine efforts. It isn’t a lot of money but it does keep cardboard out of landfills and you can advertise that to your customers.

     Resolutions may not be easy to keep but once you start down the road of using merchandise protection and you see the money you save in shortage and how easy it is to implement you won’t find it difficult to stay on track. In 2019, resolve to make some changes that will help the environment and make your store more profitable at the same time.