Retail loss prevention initiatives necessary for success & profit

September 30, 2010 by Leave a Comment

By definition, retail loss prevention  is a type of private investigation into larceny or theft. It is police and detective work for the private business instead of the general public. Businesses that do not take into consideration basic loss prevention and asset protection procedures will not survive.

The focus in retail loss prevention is on shoplifting, fraud and employee theft. According to the 2006 National Retail Security Survey, shrink is divided into five categories:

46.8% Employee theft
31.6% Shoplifting
14.4% Administrative error
3.75% Vendor error
2.86% Unknown error

To understand  retail loss prevention , a business needs to understand shrink. Shrink is merchandise or assets that are unaccounted for – and the loss is usually identified during an inventory. A business’s books will tell how much merchandise the business is supposed to have, based on receivings, shipments, etc. The difference between the books and what merchandise is actually there is called shrink.

A business must analyze its operations in order to identify factors that contribute to loss. Strategies must then be implemented to combat shrink. As illustrated in the statistics above, employee theft creates the most loss for a business and has to be taken into consideration when creating a program to reduce shrink. Many businesses only focus on shoplifting as a contributor, but employees can actually steal much more.

Retail loss prevention is a necessary effort in order for a business to be successful and profitable.

For more information contact us: retail loss prevention or call 1.770.426.0547.

 

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Think you need a Loss Prevention Agent?

September 30, 2010 by

Retailers are in the same group as most businesses today having to cut back staff to be more cost competitive which has made subcontracting a  loss prevention agent an attractive alternative.

A loss prevention agent (loss prevention consultants, loss prevention investigator) can fill the gap that is generated when staff cuts make managing losses more difficult than ever.  Short sidebar- Organized Retail Crime (ORC) is on the rise, big time probably due to the combination of a down economy driving more people to desperation and what looks like (to the shoplifters) a prime opportunity of practically unmanned retail stores making shoplifting easier than ever.

A loss prevention agent will be able to conduct an audit taking a look at many different areas where losses can occur.  After the information is gathered a report will be generated outlining vulnerable areas/ risks for loss whether they be inventory shrinkage, administrative error potential, vendor fraud potential or cash losses.  Even the potential for fraudulent accident claims by visitor in the building…such as slip and fall claims that are very popular in supermarkets.

Also included in the report will be a recommended action plan to correct the issues found.  This allows the owner manager to work with the loss prevention agent to prioritize solutions in a way that will work with the budget.

Reducing inventory shrinkage or overall losses (shrink) by 50% or more is common.  Those numbers result in doubling net profit margins.

For more information go to: loss prevention agent or call 1-770-426-0547

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Pre Employment Screening as a Deterrent

September 29, 2010 by

How much time could an employer save if undesirable or unqualified applicants just didn’t apply for open positions in the first place?

Letting all applicants know – up front – that your company conducts a pre employment background check on everyone as part of the applicant screening process is often enough to discourage potential applicants who have something to hide from applying.  Let them know that you do check relevant claims on the resume, such as previous employers, education and address verifications, as well as the information contained on the application, and that you do conduct these checks early in the hiring process.  If an applicant seeking a position with your company is aware that he will be facing scrutiny through a comprehensive background check, he may either decide to not pursue the position at all or to be more open and honest when describing his past and abilities, allowing a decision to reached more expeditiously.

The earlier in the process an applicant reveals any potentially adverse information, the more likely the potential employer will be to consider the relativity of the information to the position offered.  The attitude of the applicant is often, “If I can just talk to the hiring manager, I can explain this issue”, but this approach will usually not work if information has been withheld, falsified or embellished by the applicant.  However, if the applicant is honest up front, the chances are greater that the message will be heard.

The bottom line is that the sooner an under qualified candidate removes himself from the pool of potential hires, the more time that can be spent qualifying candidates who are   would truly be good fits for the open positions.  Similarly, the sooner a lesser qualified individual is removed from the process by a pre employment screening process, the better for all concerned.

For information on a personalized pre employment screening program for your company, call 770-426-0547 or click here.

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Background Checks (2 Quick + 2 Cheap = Not 2 Good)

September 29, 2010 by

If you’re shopping for a background check company for your company for the first time or to see what’s out there, be advised that there are a lot of companies and claims out there.

Some will claim “instant” results for a criminal check.  Others will tell you that their check is “Nationwide”, or a national criminal record check.  Some will offer to conduct your employee background check for a dollar or two.  A reputable company will discuss your requirements and let you know honestly what to expect in the way of results and costs, as well as what your obligations are as an employer to your applicant.

You didn’t get where you are in business by believing everything you hear, so be sure you are going to get your money’s worth before deciding which background check company to use.

If your results are back to you instantly, you have probably received them from a company that utilizes a commercial database.  The results may be for your applicant or it may be for someone with a similar name.  It’s generally left up to the employer to determine the true identity.  Most databases upload information from public data providers no more frequently than monthly.  Some are more infrequent than that, which leads to more recent and current criminal activity being unreported.

If your cost is ultra cheap for each criminal search, will you truly be able to rely on the expertise of your provider to explain results when necessary.

Remember that each background check is different from another, and the cookie cutter approach to background checking may not be the best value for you.

Use care when selecting a background check company and be sure that you select a company that will partner with you to deliver an excellent value and a product you can trust.

Call 770-426-0547 for assistance in setting up you background screening program or click here for further information.

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Employee Fraud – A sample of Loss Prevention in Atlanta

September 28, 2010 by Leave a Comment

Let’s talk a little about corporate fraud , a sometimes underestimated and misunderstood factor of internal theft.

Employee fraud is a very much relevant dishonest trend amongst all levels of employees. From corporate fraud , white collar crime to the store associates ringing on the registers for 8 hours a shift. All subject to it, some fall into it. Now corporate fraud and white collar crime are a true threat, the instances are not as common as the young full time employee ringing on the register. They are not faced with the same daily temptations. Both are equally destructive, yet one stands out as the true indicator of employee fraud.

As an example, we had a cashier. He was a young, part-time man…about 19 years old. He discovered a unique feature of our cash register systems. The system allowed him to use multiple coupons for items he wanted to purchase. On his lunch break, he took a handful of the store’s ads from the front display and went to the Break room. Over the next 45 minutes, he cut out various and multiple coupons of items he thought he could sell at his uncles’ shop in the downtown area.

Using his employee discount along with several coupons, the employee would ring the items for just about free, and at times would get some cash back. He scanned multiple coupons, multiple times. He had discovered competitors coupons with our company’s endorsement and in-house coupons (those created by our corporate office) were not flagged for multiple use in our stores register system. So an electronic toothbrush for $50 retail was sold to him using 5 $10 off coupons. What a deal.

After a loss prevention investigation, I was able to discover the trend of the employee fraud and identified several fraudulent transactions that later caused problems for him and his uncles’ side business.

The retailer subsequently made changes to their register system and advertisements to impose disclaimers on usage.

Employee fraud may not be the easiest to identify, but it is a regular occurrence amongst retailers.

For information on employee fraud or white collar crime in Atlanta please contact us at employee fraud or call 1.770.426.0547

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Security and Loss Prevention similar but not the same

September 28, 2010 by Leave a Comment

If you are or work for a small to medium sized retailer with less than ten locations you may be thinking security and loss prevention are one in the same.  Most retailers that size do not have a loss prevention staff or even a program in place.  Many that I run into will respond, “I have a security system” when I ask about their loss prevention situation.  What they mean to say is “I have a burglar alarm.” 

A burglar alarm, known as a security system, is armed when the facility is closed and no one is in the location.  Just stating the obvious, when a protected point such as a door or window is breached it sets of the burglar alarm which triggers a string of events that will result in the police being dispatched to the location. 

Retail loss prevention will include a burglar alarm to protect assests when the facility is closed; however, most retail losses accur when the store is open.  Taking a look at other security and loss prevention solutions are CCTV (surveillance cameras).  CCTV systems are great for recording events where loss occurs so that you can retrieve the evidence for use in court etc…

An active loss prevention security solution is an EAS (Electronic Article Security) system such as Checkpoint Systems.  Checkpoint systems involve installing antennas at doors that detect anti theft devices that are placed on merchandise.  These anti theft devices are either pinned on or are labels that are stuck on.  When a shoplifter approaches an exit with merchandise that has not been paid for the Checkpoint system will alarm alerting staff of the issue.  This catches the shoplifting in the act, thus a Checkpoint system is considered an active  loss prevention security method.

For more information and or to learn about your options for protecting your merchandise visit:  security and loss prevention 

 

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What can a Loss Prevention Agent do for my business?

September 28, 2010 by

A loss prevention agent is an expert at reducing loss and increasing profits for a business owner. Any type of business can be the victim of theft from customers or employees: to what extent depends on what the business owner does to prevent and deter this activity.

For example, a business owner may not notice that a certain area of his store may attract shoplifters but a loss prevention agent is trained to spot these theft “hot spots.” Shoplifters tend to identify these comfort zones better than the employees themselves. A business does not want to help provide the opportunity for shoplifters to steal!

Businesses can also teach employees how to react to suspicious customers by having a consultant provide training. Employees can be taught how to identify a potential thief, and what to do to deter theft. Employees that do not receive such training when they are hired may not have any idea how to react should they notice that a theft is occurring or is about to occur. The resulting loss can be extremely frustrating for the business owner or manager.

Businesses might choose to bring in a loss prevention agent when they have a potential employee theft issue. Employee theft costs businesses more on average than customer thefts, and when this occurs it is an excellent time to bring in an expert. These experts are trained in retail fraud and conducting these types of investigations. Experts can also write or advise about policies and controls that should be implemented in order to help prevent future employee theft.

The possibilities are endless on how businesses can benefit from the expert advice of a loss prevention agent.

For more information contact us: loss prevention agent or call 1.770.426.0547.

 

 

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To Arrest Or Not To Arrest – Juvenile Shoplifters & Our Efforts To Prevent Shoplifting

September 27, 2010 by Leave a Comment

In our efforts to prevent shoplifting we must make several business decisions. One of these is should we prosecute juvenile shoplifters? Some retailers say yes some no. I am of the opinion that all shoplifters regardless of age should be criminally charged.

Let’s say that this is the kid’s first offence, this may be the first time caught. A good scare by the Police and Courts will have a lasting effect. When I was in High School I was a Police Explorer Scout. One of my duties was to sit outside the holding cell of juvenile shoplifters while decisions were made. I remember that in one case a young girl maybe 13 years old had been caught at a major retail store. The store had a policy that criminal charges were left up to the discretion of the Police.

When the parents arrived they talked to the Police Lt and were deeply concerned about the girl. They in no way tried to get her out of it. They were more concerned about the long-term lesson she should take away from the incident. The Lt seeing that the parents were cooperative and caring worked with them.

After a plan was hatched I opened the cell door. The girl was relieved that her parents were there but Dad said “I am sorry that you are here but you did this to yourself. Your Mother and I do not know if we can help you or not. But we will try.” At that point he closed the cell door and they walked back to the Lt. They said that they would see him in an hour or so and left to get a cup of coffee. The girl cried for most of that time. I have a strong suspicion that she has never shoplifted again. Talk about a prevent shoplifting program.

What studies show is very simple. There is a much lower rate FOR JUVENILES being rearrested vs. Juveniles that were not. I believe that if we impact this early on we are not only doing our businesses a favor but our society as a whole. If a child is not taught right from wrong what will they aspire to? Prevent shoplifting with juveniles and eventually the overall shoplifting rates will go down.

For more information contact us at prevent shoplifting loss or call 1.770.426.0547

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The basics of Loss Prevention

September 27, 2010 by Leave a Comment

Loss Prevention, traditionally, is a department or part of many retailers and businesses throughout the world. The responsibilities are generally the same; prevent losses.

Through a proactive approach, loss prevention can be a real asset to any company interested in protecting themselves from a number of different losses. Shoplifters, employee theft, receiving/delivery issues, vendor fraud and other administrative related concerns are the reality retailers and businesses face.

As an example, a local grocer I worked for some years ago faced a number of challenges. They were a smaller business, competing against the likes of Ralphs, Vons and other big name grocers. However, they had a niche, the community loved them. They were profitable and able to open to more local stores. As the business grew, so did the issues. More employees increased the likely hood of employee theft and dishonest employees. The operations department did not have the time or the experience on detecting and preventing such occurrences. They needed help, and fast. The company I worked for at the time was hired. The operators of the loss prevention organization came in with a fury. They quickly identified the issues and worked with the management on creating a plan to aggressively go after those causing the losses and rolled out a plan to help prevent them from occurring in the future. Initially, we launched several investigations into large dollar losses various departments were suffering. We uncovered everything from a local delivery company not delivering all the goods, and working with a dishonest employee to keep some of the company merchandise for his own little side business to big name, brand name vendors delivering only part of the merchandise ordered and fudging the numbers on invoices to reflect otherwise. Today, this grocer is thriving. They have about 21 locations and are looking forward to growth in the future.

Loss Prevention is an important and integral part of a business. A solid program delivering better than expected results should always be the outcome.

For more information visit us at loss prevention or call us at 1.770.426.0547

 

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Is clothing security necessary for my business?

September 27, 2010 by

Retailers that sell clothing have to consider what type of clothing security they would like to use for their business.  There are many options out there for the business owner to choose from – from absolutely nothing to top of the line EAS systems.

Potential shoplifters look at such security measures when deciding whether or not to steal from your business.  They can be more alert and savvy than we give them credit for.  Clothing is an extremely common shoplifted item:  it can be easily concealed within a purse, in a coat pocket or even worn out of your store by the thief.  Utilizing clothing security is a smart business move that can substantially boost your business’s profits.

There are ways to remove or “beat” clothing security tags; ways that are easily found on the internet. This can be a challenging task for the thief, however, when he or she is within a retail environment with EAS alarms at the doors and employees just around the corner.  If a potential shoplifter notices that your items have a security device, they will move on to the next retailer that does not.  Clothing security is a win-win for minimal investment and it can have a tremendous impact on your net profit.

For more information visit:  clothing security or call 1.770.426.0547.

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