Get control over retail shrinkage

December 3, 2010 by Leave a Comment

If you are suffering from retail shrinkage problems you may feel like you have no control.  We will take a look at a few ways to get control into your hands to stop those issues and start making more money.

You probably have a “security system”.  This is a burglar alarm that you only arm when you are not there / store is closed.  To add to this basic level of security against burglary, consider installing motion detection light outdoors.  There are products designed for this, such as that offered by TAKEX.  Great deterrent that will hopefully keep thieves out.  You may be able to connect to your burglar alarm so that if the sensor is triggered it will set off the alarm and dial the central station.

During business hours is when most  retail loss occurs. And over 42% of your losses (based on industry average) are by employees.  Employee theft can be much more fatal than shoplifting because employees have access to sensitive info and typically steal ten times per occurrence more than a shoplifter.  Look for a loss prevention professional to hire for an audit.  These pros will identify vulnerabilities and help you set up policies and procedures to nip this issue in the bud…and might even identify an issue with an employee.  At that point they can help you through how to process the employee theft investigation etc… to get the best possible end result for your business and good employees.

Consider a Checkpoint systems retail shrinkage control system.  This system tags merchandise with security devices that come in a variety of sizes, shapes and even paper labels.  The devices will interact with sensors at doorways and actively alert when there is a theft in progress.

For more information on how to develop a loss prevention plan, visit: retail shrinkage control

 

 

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Reducing Employee Theft – Atlanta Georgia

December 3, 2010 by Leave a Comment

Employee theft is potentially one of the most dangerous hazards to the bottom line of any small business. In some cases dishonest employees account for up to two-thirds of all company losses. Yet some companies still don’t take the proper precautions to safeguard their profit margins. Doing so is largely a matter of careful pre-employment screening and selection. Reference checks, credit checks, psychological tests and personal character examinations are all tools you can use to ensure the person you are trusting with your business and its’ success is worth your trust.

Even the savviest employer can be fooled by a dishonest employee. For example, I was helping out a colleague in a nearby town a while back. When I arrived he was in a meeting so I sat in the waiting room for a while. A young man arrived shortly after me and we struck up a very pleasant conversation about the city, the company and life in general. I have to admit I was quite impressed with his eloquence and his knowledge of business. My friend emerged moments later and grimaced noticeably at the sight of the young man. Once we were in his office, my friend explained that the young man was being terminated for lying on his application. He had a substantial criminal history, including two counts of sexual assault against a minor. I was appalled. How could such a fiend seem so… regular? However, the truth is that they often do.

True, there is no sure way to stop employee theft completely, but a pre-employment screening can go a long way to giving you some peace of mind. In the case above the young man was terminated before he had a chance to commit a crime against the company. However, they still spent countless dollars training him, man-hours to investigate and terminate him, then more money to train his replacement. A pre-employment screening could have saved them a lot of trouble and money. Reducing employee theft starts at the very beginning of the hiring process. Good people equal good business.

For more information about employee theft investigation , internal theft or employee theft investigation contact us at employee theft or call 1.770.426.0547 – Atlanta Georgia

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It takes a team to conduct an effective corporate fraud investigation / employee theft investigation

December 3, 2010 by Leave a Comment

If you are suspicious that an employee had stolen from your company, embezzled money, where do you start to try to resolve the issue?  Many managers / owners will first call their CPA or resource for accounting.  This is a great start.  Trained CPA’s who know how to find fraud can trace issues in the books and build a case of evidence that will likely lead to a suspect or suspects.  Sometimes that CPA will even be fraud certified and have the CFE designation (and there are others).

So now that you have some evidence and a suspect or suspects, does the accountant interview them?  Do you interview them?  Do you call your attorney to interview them?  Maybe one or all of the above.

To conduct the best possible corporate fraud investigation consider hiring a corporate fraud investigator who will work as a link in the chain of the investigation.  The corporate fraud investigator should have training from an organization such as John E. Reid & Associates, Inc., and carry certification to prove it.  But the training alone is really not where the effectiveness lies, it is the experience of conducting not just one corporate fraud investigation but hundreds.

The professionally trained corporate fraud investigator will conduct interviews and move on into interrogations to obtain written confessions.  This is the bow on top of the work that the CPA, management and Law team have all put together, but may not have the expertise to hit home.  A mistake in the corporate fraud investigation can mean no criminal, civil cases can be filed and there is no hope of recovering losses.

For more info regarding hiring a professional corporate fraud investigator visit: corporate fraud investigation.

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How to prevent shoplifting

December 2, 2010 by Leave a Comment

If you are reading this you are likely a retailer who has recently experienced loss looking for ways to help prevent shoplifting.  If you have been in business a little while you know that inventory shrinkage – inventory loss is going to happen and there is only one way to not have any, close the doors and send every employee home.  It is a matter of reducing your losses to a reasonable acceptable level.

Let’s fix some thinking about CCTV: cameras do not prevent shoplifting on significant levels.  Cameras will deter the impulsive shoplifter who is not your typical thief.  Not worth the investment to simply deter that group.  Amateur and professional shoplifters know that no one is watching the cameras and they totally ignore them.

Your burglar alarm is a mute point…it is only in use when you are closed.

The use of an EAS system (electronic article surveillance) such as a Checkpoint system will prevent shoplifting better than anything else short of hiring loss prevention security agents to walk the store. 

The presence of the Checkpoint system will keep most shoplifters out…studies show 85%.  And this majority makes up the most losses.  What’s left are the professional who will steal no matter what, but thank goodness they are the minority.

So number one way to prevent shoplifting is employ security personnel, second best, install a checkpoint system.

For more info visit: prevent shoplifting 

 

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What is Loss Prevention Security?

December 2, 2010 by Leave a Comment

 

Although I get this question asked of me indirectly, it is an interesting question to me, “what is loss prevention security”?  Many retailers consider their burglar alarm as loss prevention security and it is to an extent, but only when the doors are closed, no one is in and the alarm is set.  That makes it more of a “loss alert” than prevention security.  The reality is most retail loss occurs during business hours.

The next most popular “I have loss prevention security” comment is in regards to their camera system. And again 99% of these systems are not actively in use for prevention.  Retail camera systems – CCTV surveillance for retail, are typically in “set it and forget it” mode.  In fact, most retailers never even check their recording device any more since DVRs will automatically overwrite recorded info firt in first out.  In other words, no one is sitting in front of the monitor watching the cameras during business hours in order to prevent theft.  The shoplifters know this by the way and couldn’t care less when they see cameras in place.

Maybe you think of a uniformed security guard as loss prevention security, which if they are actually trained on loss prevention and understand how to prevent and process theft, they are a good source of loss prevention security.  Trained people always trump installed systems.  However, very few retailers can afford 24 hour security personnel.

The best installed loss prevention security is active in nature like an EAS (electronic article surveillance) system.  Checkpoint Systems is the leading EAS installer and you will see their systems in store like Kohls, Target, Old Navy, Gap, CVS, Walgreens, Rite Aid and so on.  These are active systems because they alert the store employees immediately when theft is attempted.

Even then the systems full benefit will not be realized without good employee interaction.

For more info visit: loss prevention security 

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Retail loss prevention system pays for itself

December 2, 2010 by Leave a Comment

Checkpoint systems retail loss prevention technology will pay for itself in a few short months…and then it is a huge money maker. 

Let’s take a look at some actual statistics that point out how the Checkpoint systems technology effects the numbers.  Price Waterhouse Coopers conducted a survey recently where they watched 98 sku’s in a supermarket chain, four locations, for fourteen weeks.  There were four weeks pre Checkpoint Systems install and ten weeks post install.

Working with store management, they identified high shrink items and determined pre install shrink levels.  They then performed weekly inventory counts to determine results.

PWC found that these 98 sku’s went from over $1,000 per week in shrink to $306 per week in shrink.  That is a reduction if inventory shrinkage of 69.79%.  They also found that sales increased by 9.2% because more stock was available for sale to paying customers.

If we simply look at the shrink reduction we can make some calculations.  The average retailer with $1mil in annual revenues and a shrink rate of 3% is losing $30,000.  Reducing the shrink by 69% equals $20,700 less shrink.  This $20,700 goes directly to the bottom line profit margin.  Again the average retailer is seeing a net margin of less than but let’s use 3%.  So the net profit goes from $30k to $50.7k which is also a 69% jump in margin.

The average Checkpoint Systems retail loss prevention install for a one door retailer is less than $5k.  You could buy four of these systems in one year with the reduction in loses.  And consider the improvement on the overall numbers of the business…it’s a no brain-er.

For more info visit: retail loss prevention 

 

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Why contract a Loss Prevention Investigator – Loss Prevention Agent

December 2, 2010 by

Smaller to mid sized retailers may not have full time staff and benefit from contracting a loss prevention investigator – loss prevention agent to keep on top of issues and keep overhead low.

A primary function of the loss prevention investigator – loss prevention agent is to fist assess the current state of the business.  Observing daily procedures for receiving and inventory practices, cash drawer open and closing as well as daily operation and shortage policies are a few areas of focus.  Other areas looked at are clock in and clock out practices, inventory and cycle counting procedures and practices, alarm system / CCTV (camera) system operation & usage and safety issues.

The goal of the loss prevention agent is to save profit from being lost through weak operational practices as well as identify and process the big ones like shoplifting issues and employee theft problems.  These more routine areas where money can fly out the door are often not even on the mind of the retailer when considering the hire of a loss prevention investigator to help solve issues and improve profitability.

Another benefit of an outside contractor is there is no “inside” or internal employee dynamics which can lead to emotional attachments and biases / favoritism etc… You get a truly objective individual with your best interest at heart and no one else’s.

For more information visit: loss prevention investigator / loss prevention agent 

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Use security tags on clothes to prevent shoplifting

December 2, 2010 by

 

Clothing retailers commonly use security tags on clothes to prevent shoplifting and there are a few benefits as well as some caution.

The caution to using security tags on clothes is to be sure you choose your clothing security tags wisely.  There are different types and sizes of clothing security tags as well as different manufacturers and their effectiveness will vary.  The clothing security tags that have long tabs on either side of the pin that holds it to the clothing are easier for thieves to remove.  The professional shoplifters study how to do this.  If you did a google search and found this article you undoubtedly saw several you tube listings in the search for how to remove security tags on clothes as well.

Tags that are hard to grab hold of, hard to get under etc are the most secure and tough to defeat. Checkpoint systems has several tags that are designed to foil the shoplifters plans.  There are button shaped tags that have a lip on the bottom of them, so not only can you not grab any tabs on the tag, you can not get under the pin/ tag connection.

The benefit of using security tags on clothes is obviously it will reduce your inventory shrinkage.  Most studies show at least a 50% reduction in losses, most are 60% to 75% and some realize even better results.

And having tough anti shoplifting measures in place means shoplifters will simply pass your store by and move on to an unprotected site.

To learn more visit: security tags on clothes /  clothing security tags 

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Home Service Workers Get Background Checks

December 2, 2010 by

Home Service Workers Get Background Checks

Customers who receive in home visits from employees of service companies don’t expect to be victimized by those employees.  They would expect the employees would have been subjected to some scrutiny, including background checks, before being sent to and allowed to enter a customer’s home.  The fact is that this is often not the case.

Service companies include electrical contractors, pest control, plumbers, appliance repairmen, heating and air conditioning repairmen, cleaners, you name it.

Most companies will publicize the fact that their employees are banded and insured, but that does not necessarily mean that their employee have been the subjects of a pre employment background checks.

Many times the company hired by the homeowner will subcontract another company to perform the work and don’t really know if pre employment screening has been thoroughly conducted or not.

In addition to theft issues, which occur frequently, there are instances of harm coming to the homeowner or tenant at the hands of the employee.

In 2001, for instance a homeowner paid a nationally known company to clean the air ducts in her house.  Six months later, the serviceman returned to the home, raped and murdered the homeowner, and set fire to the house to cover evidence of his crime.  The murderer was a registered sex offender and on parole at the time of his first visit to the home.

An employee of a plumbing company and his customer had a disagreement over the cost of the repair and the plumber assaulted the customer.  The plumber had previously been arrested for battery, something the employer should have known.  A negligent hiring lawsuit was soon filed.

Pre employment screening and background checks are an affirmative defense against negligent hiring lawsuits.

Businesses that conduct pre employment background checks instill confidence in their customers by demonstrating care in the selection of their employees.

For further information on pre employment screening and background checks, call 770-426-0547 or click here.

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Background Checks and Phony Identification

December 2, 2010 by

Background Checks and Phony Identification

You can get bad results from good background checks.

Identity theft has become a major problem to users of credit reports and to law enforcement.  It is a major headache to those unfortunate enough to have had their identity assumed by another person.  Millions of dollars are lost to fraud based on stolen identities.

Problems also arise when applicants use fake or purchased identification when applying for a job.

The FTC says that 17% of all identity theft in California is done for employment purposes.

Using stolen or fraudulent ID, a person applies for a job.  The company runs a name based background check using the name, date of birth, and other identifiers provided by the applicant.  The background check is returned showing accurate results, but not for the person applying for the job.  It is the background of the person whose identification was used, and the results may show that the applicant is suited for the job.  Background checks in this cases like these are worse than worthless, since they have has absolutely nothing to do with the candidates applying for the job.

Anyone applying for a job will expect to provide identification.  Employers should be thoroughly familiar with the various forms of drivers’ licenses, state issued identification, and ask for other documents if any look suspicious.  Also accept only a genuine social security card, not a copy or facsimile of some kind.  If they are unsure, resources are available to help.

Problems also appear when a person is arrested and booked using a fake ID.  The arresting agency uses the name and identifiers to enter the perpetrator into the criminal repository, and the arrestee becomes the person on the ID.  Sometimes the arrested person goes so far as to go to court and pay a fine using the false name.

This becomes a huge problem when the person whose ID was used goes to apply for a job and finds out that he or she has an arrest record.  The only way to get this straightened out is that once the information is disclosed to the applicant, he must go the arresting agency and request a fingerprint comparison.  Then the record can be removed, but this is procedure that can often take weeks or even months.  Then the victim is generally given a letter from the agency attesting that he is not the person named for that particular arrest.

When using background checks, be aware of the implication bogus ID’s may have, and how they may be used.

For further information on background checks, call 770-426-0547 or click here.

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