Quit Stalling About Employee Theft

Every day I see news articles about employee theft. That does not even cover a fraction of the employee theft occurring both know or unknown. The fact is that approximately 45% of a Retailer’s losses are due to employees stealing. We focus so heavily on shoplifting that many times a Retailer misses the boat completely. Do not misinterpret what I am saying, shoplifting is responsible for about 35 percent of a Retailer’s losses. Which is also huge.

However, employees have access to your cash, supplies, and merchandise. Employees are generally trusted until they show us that they are not. Which may be too late! Many Retailers I have discussed this with over the years tell me that they trust their employees and treat them well. Therefore they would not steal from them. Those are the folks that have the worst losses and the biggest shock when it does happen. As human beings, we do not want to believe that someone would steal from us. We also are quick to turn a blind eye to the evidence even when it hits us in the head. We simply do not want to believe it.  

Another factor is that many Retailers do not know, understand and are afraid to do something. Will we make a mistake? Would we accuse someone of something they did not do? What civil and criminal consequences do we face? And the list goes on. This is yet another stalling factor for not doing anything. 

Quit stalling about employee theft. You face every other retail problem head on why not this. Educate yourself. We can help you with this. Make sure you know the signals of employee theft. Yes, employees who steal, act differently than other employees. You simply need to know what to listen and watch for. Do you “audit” your operation? For example, an audit can be as simple as making sure the Point-Of-Sale balances every day and if it does not, find out why. I have seen many Owners and Managers that say if the drawer is short $5 or less, they do not look into it because “it is not worth my time”, REALLY??? THAT IS SO WRONG and dangerous!!!! First by having a policy like this you are telling everyone that stealing $4.99 and below is okay. $4.99 times 365 days a year is a loss of $1,821.35. Oh, and that kind of theft WILL lead to larger and more frequent employee theft. 

Over my career, I have investigated, interrogated and put in jail somewhere north of 2300 employees for theft. The vast majority of those employees that were stealing did it for the same reasons. Many still stole even those the boss was “good to them”. I have seen employees that had been loaned large amounts of money by their employer, employees that were being put through school by their employer steal with no regret except for being caught. 

We can train you to spot employee theft and what to do about it when you suspect and find it. It is not hard to do. We can show you how to “test” employees to see if they are stealing. We can help you build the confidence to be on the offense, not the defense.  Your good employees will not care or suffer. In fact, they will help you. You just need to know how to proceed. 

Would you knowingly buy a car that had major engine and transmission problems? Probably not. So why would you hire someone with a criminal record? Why would you not find out that they have problems with violence, theft, drugs and worse when it is so simple, fast and cost-effective to do so? We can help you with that also. We conduct pre-employment screening, drug testing and more, nationwide. Look at it this way, you interview, select, employ, train, invest in an employee just to find out the hard way that they are very familiar with employee theft? When a pre-employment screening costs $20 how can you afford not to. Drug testing is also very inexpensive. You can quickly, cheaply and easily have a pre-employment drug testing done on all of your employment candidates when you offer them the position. Again, we conduct pre-employment screening and drug testing nationwide. 

You control every other aspect of your business, why would you not take more control of employee theft? Contact us today or call toll free 1-866-914-2567. 

What can a Loss Prevention System do for you?

Loss prevention technology along with the proper personnel training will allow a retail store to reduce loss, improve customer service and provide the data necessary to access up to minute inventory information in the store.

A loss prevention system is a preventable measure retail stores need to adopt to prevent the losses that plague the retail industry. A loss prevention system along with trained personnel can be a deterrent to shoplifting, vendor and employee theft that can save the retail store thousands of dollars a month.

A loss prevention system can protect the merchandise in the store while protecting customers and the employees as well. Incidents, where violence and sometimes deaths occur, can be avoided with the proper systems, training, and the continuous effort to ensure the safety of the employees and customers alike.

A loss prevention system can allow the employees and manager of a store to focus and ensure customers have a good experience shopping at their store. Good customer experience can translate to continuous business, and great customer satisfaction has been linked to less shoplifting in the retail industry.

If you are the owner of several retail stores, a loss prevention system can be adapted to each store’s unique layout and needs while providing the same information you need to prevent shoplifting or to take the necessary measures to prevent it.

A loss prevention system is an investment a retail store cannot do without, but along with an investment in a loss prevention system, trained personnel plays an important role in making sure the system can do what it is supposed to do. Data from the loss prevention system cannot go unchecked, and it cannot be ignored.

Employees have to be trained and knowledgeable of the stores’ policies and procedures regarding shoplifting to ensure an efficient and quick response if shoplifting occurs in the store. Violence can and must be avoided at all costs.

There’s research out there that clearly indicates the cost versus benefits of having a loss prevention system in place.  Profits in a business can be slim, losing them to shoplifting, employee or vendor theft can be detrimental to any business.

Benefits of a Loss Prevention System

Most retailers in the United States end their fiscal year on December 31st. and begin the New year with a new budget, new goals, and new strategies to implement in their business.  

For the loss prevention team or management of the store, allocating sufficient funds to the prevention of shoplifting and security of their store begins anew.  If a store has not purchase a loss prevention system and the losses of the store are too many to ignore, the new year allows them to budget and purchase a system that will help them minimize their losses and prevent them from happening in the future.

Research has shown the budget for the prevention of shoplifting and loss prevention teams have been declining over the years with no plans to change it, while the problems associated with shoplifting, employee theft, internal clerical issues and lost merchandise continue to grow.  Every retail store has different problems associated with them, but shoplifting is a problem that is common for every one of them. 

Allocating enough funds to the prevention of theft in your store is vital. According to research purchasing a loss prevention system to help you minimize the losses in your store will return your investment within months. Reduction in merchandise losses, increase productivity, personnel reduction, and an increase in sales are some of the benefits associated with the purchase of a loss prevention system that will see more profits going to you.

Finding out what kind of loss prevention system your store requires will need the help of a seller that understands systems, training and prices. 

An EAS system can give the store an up to the minute understanding of what merchandise is in the store, what items have been sold, and what merchandise is missing. These systems can let you know up to the minute information about your store without having to do a physical count every time you need to know something about a specific item.  With an EAS or a point-of-sale (POS) system, information about the merchandise in your store is within your grasp within minutes.

Investing in technology that can help your management and loss prevention teams work effectively while minimizing cost will help your store succeed.  These systems not only offer help in deterring shoplifting but help you meet the needs of customers and their shopping habits.

Preventing shoplifting in your store with a loss prevention system is key to your success.

A Loss Prevention System To Start The New Year

Shrink in the retail industry is a  loss that many retailers seem unable to fight.  The budget to invest in security in the retail industry has declined over the years with no plans to restore it now or in the foreseeable future. Many of the small retailers believe that installing a loss prevention system will be too expensive for them to afford even though  they seem unable to stop the shoplifting that is causing their store major losses.

Loss prevention systems that allow these retailers to deter the shoplifting from happening in their stores are an investment they seem to ignore or to believe they are too expensive for them to even consider. The benefits associated with installing a loss prevention system in a retail store are numerous, and research has  shown the investment of purchasing such system can be recouped within a year.

Many retail stores do a physical inventory regularly that allows them to gauge the state of their store. Depending on the size of their business, this physical inventory should be done at the end of the month or quarter, and definitely one at the end of the year. For many retail stores, if an inventory is done after the holidays, it can offer a very shocking reality.  

The shoplifting, employee theft, vendor and clerical errors are seen clearly and painfully, and cannot offer an explanation or a solution to the tremendous losses in the store. A physical inventory is also a very expensive way to account for the merchandise in the store. The many hours and personnel required to do this kind of inventory are financially draining for many businesses and their bottom line.

If after the holidays your business has decided to purchase and install a loss prevention system that will allow you to deter the shoplifting and  employee theft in your store, there are a few key features such system should have to help you be successful.

  1. A software platform that allows the retail business a concise and up to the minute inventory analysis to make the necessary adjustments for their business.  
  2. EAS  solutions that are tied to an RF surveillance system that enables the loss prevention team to make decisions accurately and in a timely manner every day all year long
  3. A loss prevention system that will offer training to your employees and help you navigate solutions to your specific problems.

There are many loss prevention systems sellers that will help you find the financing available, give you the training, and the customer care you need to make the installation of the system a success.

Having doubts about buying and installing a loss prevention system in place is understandable and expected.  But, letting shoplifting, employee theft and other external factors influence the earnings you work hard to earn is not a sustainable solution. Contact us and talk to us, we will be happy to work with you.

Tips On Merchandise Placement To Satisfy BOTH Sales And LP

Do you want to know one of the fastest ways to make a Loss Prevention Manager cringe? Place high dollar merchandise within a few feet of your entrance/exit doors. Another great idea is to stack out a pallet of 32 inch LCD televisions for that Black Friday door buster with no protective devices on them because you know how fast they are going to go out the door (the L.P. Manager knows how fast too but from a different perspective). Frequently store managers want to put merchandise on display near the front of the store where customers are certain to see the items and entice them with an impulse buy. The downside to the strategy is that it creates a major opportunity for crooks to sneak merchandise out quickly without being noticed. They wait for a group of people to enter or leave, pick up the merchandise and blend in with the crowd then exit with the goods. I’ve seen it happen.

     On the other side of the fence you have Loss Prevention Managers out there who want to lock up everything. They aren’t thinking about what drives sales or impacts the shopping habits of customers. Their concern is that the merchandise is placed in such a way that it can’t be stolen. I’ve been one of those managers and I thought I had the best interests of the store in mind as I sought to keep valuable new displays on a tight leash. Keep the merchandise in the store and out of the hands of criminals and you save stock shortage. Doesn’t THAT drive sales for the store? Customers can’t purchase what has been stolen. Keep those goods in the store and sales will soar because paying customers can get their hands on it.

     There has to be a happy place where security and availability can meet. Merchants and Loss Prevention can find a common ground but they need to work together to do it. Having learned my own lessons over time I would like to share some ideas that can be beneficial to store sales objectives without creating a security risk to merchandise.

  • Coming from many years in Loss Prevention I want to first say to the Loss Prevention department; remember that the number one priority of the store is to SELL merchandise. Your job is to help do that and this means being a partner and understanding WHY a manager may want to place a product in a particular place. You should take a look at what the manager wants to do and offer constructive suggestions that can decrease the chances of merchandise theft without being an obstacle to the decision.
  • Before any new planograms are set or merchandise displays are placed, managers meet with L.P. and discuss what you are planning. L.P. may have suggestions to help make merchandise secure without compromising the desire to put merchandise in the hands of the consumers. There may be electronic article surveillance tags or labels that can be applied to merchandise.
  • If the merchandise is to be located close to the front of the store put it in a location near a cash register. Keeping products within the line of sight of employees is one way to deter theft.
  • Keep track of product quantities. This means several times a day taking a count of the pieces of merchandise on a display and tracking sales of those items. If you start to identify a theft trend then re-evaluate your merchandise protection strategy.
  • Don’t use locking display cases! Unless the item has a very high dollar price point there are alternatives available to stores to secure merchandise. There are security boxes and cases on the market that allow shoppers to pick up and handle goods without being able to actually touch the item.  These cases (such as a Sensormatic flexible safer for example) prevent shoplifting while allowing a customer to select an item and continue shopping (customers don’t like to wait for help at a display case).
  • If your store has closed circuit television then consider placing a camera and a monitor as a public view set-up. It discourages theft when people see that they are on camera.

New product displays attract customer attention and increase sales. When Loss Prevention and Store Management work together on these projects sales will be successful. Let’s not forget that shortage due to theft will also be minimized if not eliminated and THAT makes EVERYONE happy!


Tips That I Wish I Had Learned Before Entering Loss Prevention      

Loss Prevention is a wonderful career choice that can lead to other positions in retail. There are, however tips I wish I had known before I began the job that would have prepared me for the adventure I was about to embark on. I started out in a Loss Prevention Associate position after spending four years as a U.S. Air Force Law Enforcement Specialist and another 2 ½ years earning a Bachelor’s Degree.  I was offered the position and to be honest I went into it with the mindset that this was a Law Enforcement position in civilian clothing. There was nothing that really dissuaded me from the notion as I was taught to catch shoplifters, use closed circuit television cameras and electronic article surveillance equipment. I assisted with employee theft cases but these were few and far between. It was not until later when I had been a Loss Prevention Manager for several years before I started to understand the real role of Loss Prevention in a store. With this is mind there are some things that I would like share with those entering the profession that can be eye opening and prepare them for the job ahead.

  • You are not the retail police – Unfortunately it is easy to fall into the trap of believing you are an arm of the police department. You aren’t. You can and should build strong partnerships with police but you are not protecting the community. Your job is to make your store profitable. You need to learn about stock shortage and all of the ways it happens. Yes, you need to learn to identify, prevent and maybe catch shoplifters. You also need to add to that knowledge how employee theft occurs, how to identify it and investigate it. You also need to understand vendor processes, how to read invoices and credits. You should spend time learning and stocking freight and where operational shortage takes place. Become intimately familiar with cashiering procedures and cash office functions. Each of these areas of responsibility impact store profits and the more you know the better you become at multiple areas of the store.
  • Hiring and Supervision – You may only be starting as a Loss Prevention Associate but if you are smart you will partner with the hiring manager. Ask to be part of the store application review process. Learn to look for the red flags on a candidate’s application or resume that could spell trouble if that person is hired. You can be a valuable partner in helping in the hiring process. As a Loss Prevention Manager you will review applications, resumes and conduct the interviews. You will need to know your company’s hiring process and whether it includes a drug test or background check. While we are discussing it lets also talk about who you decide to hire. Hire people with skill sets that are different from yours. While I would not discourage you from hiring someone with Loss Prevention experience be mindful that that candidate may be more difficult to train. They will bring along training from other retailers that may not be in keeping with your store best practices.
  • Trainer and Leader – Get ready to train others and not just Loss Prevention personnel. You will be training store associates on electronic article surveillance alarm response. You will train cashiers on till tap and short change artist prevention. You will train employees on robbery procedures. You may work with the stock team on how to identify mis-shipped merchandise. Show them how improper stocking affects shortage and inaccurate merchandise reordering. You could be required to conduct new hire orientations. You will also instill in the whole team the importance of customer service as a means of reducing theft but also how it drives sales. As a leader you will request appointments to meet with other managers and discuss operational matters. The more informed you are in how things work the better prepared you can be to help improve operational procedures.

Clearly there is much more that a Loss Prevention professional can add to the store than just being a person who catches shoplifters.

     The core roles and responsibilities of the Loss Prevention team entail the reduction of retail shrinkage and even maintaining a safe shopping environment. You may not be a first responder but you could be the first person called to an accident inside or outside the store. Frequently it is the Loss Prevention personnel who are first called to find a lost car, lost child or stolen purse. You will be the one who has to calm an irate customer. Learn from these tips I am sharing. You aren’t going to be a police officer, you are going to be a Retail Loss Prevention Professional and that is a quite a job! 


Why Quality Background Checks Matter: The Benefits Of Using AMC

Hiring employees is hard enough for retail owners without the pressures of hiring seasonal staff during the holidays as many stores are now doing. Under normal circumstances, managers and owners of retail businesses are stretched thin keeping a store operating efficiently. When turnover occurs more time is taken up as those managers are forced to focus their energies on filling holes in the weekly schedule. Job ads are posted and often paper applications are handed out as interested persons come in to respond to the ad or a “Help Wanted” sign posted in a window. Then there is the security risk that is involved in the hiring of new employees whether they are seasonal or to be a regular member of a team. A new hire carries an unknown quality and there is always the off chance that with even the best interview a criminal can slip between the cracks, the proverbial wolf in sheep’s clothing.

     At Loss Prevention Systems, Inc. we are well aware of the challenges the hiring process poses, especially in the small to mid-size store market. In order to streamline the Human Resources piece of your business and to significantly reduce the chances that criminals will be brought on board in the process, we have introduced the Applicant Management Center (AMC). Here are some of the featured benefits we offer to employers that use our AMC to fill positions regardless of the tenure of that position:

  • Employers that rely on paper applications or in-store job kiosks limit applicants to hours of store operating hours. The Applicant Management System offered by LPSI provides interested parties 24/7 access your job application.
  • With the AMC employers can advertise an unlimited number of positions.
  • Have you dealt with sifting through untold numbers of applications, many of which are from people with none of the qualifications you are looking for in an employee? By using the AMC services of LPSI you have the ability to create qualifying questions that will flag responses. By doing so you can eliminate unqualified candidates from your applicant pool and streamline the hiring process.
  • Enjoy the benefit of communicating with applicants directly through the Applicant Management System. No more sorting through applications, typing in email addresses or risking emailing the wrong person.
  • Then there are those very real concerns over increased security risks that come with hiring. The Applicant Management Center assists store owners with mitigating concerns of hiring someone who may pose safety and/or security related problems. Owners can initiate pre-employment background checks on applicants directly through the AMC. Taylor those background checks to include what is important to you, driving records, education, criminal history, sex offender registries and so much more.
  • Drug Screening can also be initiated through the AMC helping you to eliminate illegal substance users who may cause accidents to themselves or customers. They can also be potential thieves trying to support a habit. LPSI can reduce the chances you hire someone with a drug use problem.
  • How about credit checks? Who wants to take a chance of hiring a person with a poor credit history to work around cash or a point of sale for that matter? All consent and agreement forms to conduct credit checks, background checks and drug screenings can be maintained, signed and stored in one central location in the AMC.
  • Last but not least the AMC is affordable! There is no need to break the bank to improve your hiring process.

For those readers still feeling unsure about the AMC and the background check process Loss Prevention Systems, Inc. is offering free demos of our product. LPSI recognizes that there is a direct relationship between the hiring process and store profitability. We can help you avoid hiring pitfalls. Use the Applicant Management Center and save yourself time, money and unnecessary shortage during this holiday season and throughout the year.


Merchandise Audits For Stores Without A Loss Prevention Team

Loss Prevention Managers and Associates use audits on a regular basis to keep track of merchandise that may be potentially high theft items. The items may be high dollar such as iPods, laptops, computer tablets and so on. The products being audited may simply be easy to steal and resell. Such items can include a variety of products ranging from drill bits to medicines, razor blades and even fragrances. Audits are an effective tool for Loss Prevention departments to quickly identify theft trends and to begin investigating when and how losses are taking place. For stores that cannot afford a Loss Prevention department, it falls upon store owners and managers to investigate missing merchandise. The question then becomes, how does a management team decide what items should be audited or when audits should take place?

There are different types of audits that Loss Prevention teams conduct. Some audits are completed during inventory nights. The purpose of these audits is to ensure an inventory crew is accurate in the counting of your merchandise. Mis-counts lead to inaccurate results and skewed shortage numbers. An errant finger while keying in numbers can make your inventory too high. Counting too few items results in shortage neither of which is a good thing. A falsely low inventory result usually translates to a high shrink result the following year. It is also wise to audit locations to be sure endcaps, sidecaps, and special dump bins are counted. Think of the easy to miss locations in a store.

How do you decide what should be audited? On inventory nights the inventory team crew leader may print up sheets of “suspicious” counts or “exceptions”. Usually, that team completes some of their own audits but stores should have their own audits as well. If exception sheets are not printed by an inventory team stores can decide what areas or items they want to spot check. Usually, these are going to be sections that have small items (for example, cosmetics) where it would be easy for a counter to miss multiple items that can add up to big dollars. High dollar merchandise is another area to focus on, say for instance television sets, computers or some models of vacuum cleaners. Clothing may include leather jackets and designer dresses, popular targets among thieves. One thing to keep in mind during inventories is that inventory crews are not going to want to be pestered over every little discrepancy. Usually, it is requested that only variances greater than $25 or more than 10 pieces be recounted.

The other type of audits we are discussing usually focus on specific items (SKU’s) or categories of items, for example, denim jeans valued at $30 or greater. In order to make sure that audits are value-added there needs to be a determining factor that instigates the audit and that audits are not being done on every single item in a store. Putting too many items on an audit form will ensure they do not get done properly or regularly and that renders them useless.

Daily Loss Prevention audits are usually based on suspicious activity or a reasonable concern that a certain product will be targeted by shoplifters. In one department store I worked for, we started carrying a new line of leather coats. Due to the dollar value of these jackets, we started an audit form for these items and counted them every morning. Because we had a camera set on them we were able to review a days-worth of video in a short time if a count was off. In another store I worked for, we started to see vacuum cleaners of a specific brand start to disappear. We began daily audits and partnered with other retailers that also carried this brand. We found that ours was not an isolated problem and through audits, we were able to get several suspects on camera. The key is to follow up as soon as an audit finds a difference in what store inventory says should be on hand and what actual on-hands are. If a store-generated on hand report is not available, the current count would be compared to the prior day count. Discrepancies would be researched from receipt journals and if no item was sold, the video would be reviewed.

Audits are not difficult and can aid in reducing theft and shrinkage. Keep audit lists short to help make them impactful. Use cameras to record those items you suspect are being stolen or believe are going to be a high theft SKU. Track the time as well as the day the audit is completed to narrow the window to review on video if an item is missing. You don’t have to be in L.P. to conduct audits in your store.


     

     

Theft And Fraud Can Bankrupt A Business; Contact Us For Training Seminars That Will Help You Reduce Shortage And Remain Profitable

 According to the Jack L. Hayes Annual Retail Theft Survey, released June 2016:

  • 1,170,056 shoplifters were apprehended in 2015 resulting in over $150 million recovered from apprehended shoplifters
  • 75,947 dishonest employees were apprehended in 2015 resulting in over $55 million in recoveries
  • One out of every 38 employees was apprehended for theft from their employers in 2015.

This survey was based on information from 25 large retail companies with 21,228 stores and over $700 billion in retail sales (2015). Combine this with information from the 2015 Global Retail Theft Barometer (GRTB) Report that placed shrinkage in North America at 1.27% or $36.79 billion dollars (pg. 50) and you have some scary statistical data if you are a small business owner. The 2015 GRTB also reported that shoplifting was the cause of 36% of retail shrink and dishonest employees were responsible for 45% of shortage (pg. 53). According to statisticbrain.com 37.5% of employees have stolen from their employer at least twice. The same website reports 33% of all business bankruptcies are the result of employee theft. THAT is a lot of theft! What is an employer supposed to do? If the 25 large companies surveyed by Jack L. Hayes are being impacted like this and they have access to Loss Prevention resources, how can a smaller retailer prevent this kind of theft? Is there a way for small to medium stores to address theft and fraud, reduce shrinkage and improve profitability?

     The answer to the question is yes, there is a way for small businesses to reduce shrinkage due to shoplifting and employee theft. Loss Prevention Systems, Inc. has training seminars available that will provide information on various forms of employee theft and the real impact they have on a business. The seminars don’t simply instruct on how the activity occurs but also on how it can be prevented. Additional seminars are available on shoplifting and the methods you can use to protect your merchandise and your profits. How do you detect shoplifters? Do they all act the same? Should you approach them and attempt to get your merchandise back? All of these questions will be answered by Bill Bregar, President of Loss Prevention Systems, Inc. 

     Bill’s extensive background in Law Enforcement and Loss Prevention gives him the expertise to ensure you and your staff receive solid training that can make an immediate impact on shortage reduction in your store(s). Bill’s career in investigations began when he served in the U.S. Army as a Military Policeman and in the U.S. Army Reserve as a Military Intelligence Officer. He worked for 2 years as a Police Officer for Central City Colorado. Bill has held positions of increasing responsibilities starting as a Security Manager for a grocery store chain, advancing to two different Regional Loss Prevention Manager positions, working as a Director of Loss Prevention for two different companies before becoming the President of Loss Prevention Systems, Inc. Bill’s professional competencies include being an “Expert Witness,” a Licensed Private Investigator in the State of Georgia and a Private Detective and Security Agency Training Instructor since 1998. Bill also holds a Bachelor of Science Degree in Criminal Justice and Criminology, Private Security Administration & Management from Metropolitan State College, Denver, Colorado. Finally, as someone who has conducted over 2300 employee theft investigations, Bill has the proven field experience that is a testimony to his ability to speak on issues of retail theft and fraud.

        If you want your business to be successful you have to ensure you are prepared to address all areas of shrinkage, especially those areas that impact you the most, employee theft and shoplifting. Ignoring these factors or trying to manage them without the proper knowledge and training is a recipe for disaster and you may find your store(s) in that 33% that declares bankruptcy due to employee theft. Contact Loss Prevention Systems, Inc. and schedule your training seminars with one of the premier experts in the industry today.