Using Employee Engagement To Prevent Shoplifting

January 18, 2016 by Leave a Comment

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There is no question that employee happiness in the workplace can be an asset to your company.  Happy employees that are valued can give a business the edge they need to make their business a success. Happy employees are less likely to steal from you, and are less likely to call off regularly.  Having employees that feel appreciated can be an advantage to your retail business, and a tool to prevent shoplifting.

For more about shoplifting, follow the links below.

Retailers Experience Success Due to Employee Engagement

Expert advice on how retailers can craft customized services in order to strengthen financial performance through greater quality of management and employee engagement.

Management consultant Oliver “O. Lee” Mincey, who focuses on employee engagement and the attributes of great management, has nearly 25 years of training and leadership development experience. He has developed training and learning programs positively impacting well over 40,000 people for clients and previous employers including Six Flags, Disney, Universal Studios and House of Blues.

Founded in 2009, Oliver Mincey Co. designs strategies to help clients solve their most complex and interesting leadership and employee engagement challenges. Engagement helps reduce costs associated with poor employee retention, relations and morale. Its core values are: Do what is right, always; take ownership and get it done; inspire passion for people; focus on outcomes; fuel growth and innovation for both us and our clients; and embrace good cheer.

Mincey shared five tips for great management and his secrets of employee engagement.  A great manager, he said:

Online crime system blitz on retail theft

A new cloud-based crime reporting system could prevent up to $2 million of retail thefts every day.

Police have teamed up with Auckland-based company Auror who developed software that streamlines crime reporting processes.

The software will be rolled out nationally after successful trials in Counties Manukau and Canterbury.

The software enables retailers to complete incident reports and provide relevant information to police about thefts including shoplifting and petrol drive-offs, and other incidents.

The information can be shared between retailers to prevent further offending.

A Police National Headquarters spokeswoman said all information shared through the Auror portal was automatically forwarded to the police crime reporting line.

SeeTec Cayuga BVI Retail Combines Article Surveillance With Video Analytics For Retail Security

If you believe recent surveys to be true, commercial damage in Germany caused by retail shrinkage accounts for about 3.8 billion Euro per year – this is one per cent of the total turnover of this industry. More than half of this is caused by shoplifting. Another 40 % of the total amount can be related in equal terms to employees and suppliers.

The retail industry’s answer to this enormous volume of damage is obvious: prevention and investigation by combining traditional article surveillance and intelligent video technology. Video-based systems do not only reduce retail shrinkage. They can also be used to better understand customers and their buying behaviorand to optimize the sales approach. SeeTec Cayuga BVI Retail provides solutions for both requirements.

Challenges Faced By Retail Business

Highstreet retail businesses don’t have an easy time: Online trading provides maximum price transparency and therefore puts enormous pressure on the margins through a plain cost structure and 24/7 opening hours.

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Let’s Make 2016 a More Profitable Year

January 18, 2016 by Leave a Comment

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Let’s make 2016 a more profitable year by stopping losses before they occur. Think of it, as a retailer you run your operation, purchase and then sell the products you offer and try to hold your expenses down. But when you have employees that cause inventory theft, cash theft or any other loss it comes right off your bottom line and out of your pocket. The key is to keep theft from occurring before it happens!

Do you really know who is working for you? It is inexpensive and easy to find out. You should screen EVERY person you hire. Even after 20 years of running pre-employment background checks on people for our clients we are still amazed and what we see. It is not unusual to see drunk driving, theft, assault, shoplifting and even some very violent criminal records. Do you really want people like that working for you? That is like pointing a gun at yourself and hoping it is not loaded. People who are not responsible in life are not going to become magically better because they work for you.

Most states allow a statewide criminal records check. If not then we look in the counties they have lived in.

Another check that should be run is a credit history. This can be done on people that will be handling your cash and other assets. My wife was once the Branch Manager for a large chain of banks. The banks policy was to look at the credit history of the people that they were considering for employment. Their thought process was “If you cannot handle your own money why would we want you to handle the banks or the customers?”

Another check should be to verify that they are not on a sex offender list. Imagine this. You hire someone. They sexually assault a customer or another employee. Even if it is simply alleged and then investigation shows they are on a list. Your liability just skyrocketed.

In the past we could simply say we did not know that they were a sexual predator, criminal, thief…. But that is not the case anymore. The courts have leaned towards the position that it is easy and inexpensive to screen someone so if you do not you may be left in a terrible position both criminally and civilly.

So attack loss in 2016 up front. Get your employees background checked, screen any new employees and then follow up with an annual check. It may just make your year more profitable and one with less headaches.

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CHRISTMAS EVE CHALLENGE

January 18, 2016 by Leave a Comment

shoplifting6I thought I’d take a lighter note and share some post-holiday humor. It was quite an eventful end of December for me and my team. We definitely had our share of idiot shoplifters. A few stood out that really deserved to be on the highlight reel. I hope you enjoy these as much as I did!

Every year, I make it a point to work extra hard to catch a thief on Christmas Eve. Some people call me cold, but why should I pay for gifts for someone that doesn’t want to work? They are, in fact, robbing me of my bonus! So I found myself working Christmas Eve with my top agent, at our highest shrink store. I was, in fact, stacking the deck. About noon-ish, I notice a guy practically running through the store with a shopping cart. Not too odd, given that most people are picking up last minute gifts. I watched as he loaded three motorized scooters into his cart and dashed over to the shoes. There, he asked an employee where this year’s hottest shoes were. Once shown, he threw 4 pairs in the buggy and headed to the apparel section. I stopped watching at this point and made my way around the store. As luck would have it, we intersected paths and my suspect raced down a secluded aisle. He emerged from the next aisle, as I was standing there. He rushed passed me and I noticed that his shoes were now concealed in shopping bags and he was headed to the doors. I called my agent and by the time he answered, my guy was out the door! I love a good push out.

We catch up to him under the patio and he ditches the basket and breaks out running through the parking lot. We break off and relay his direction of flight to local law enforcement. To my amazement he stops running and ducks into retailer next door. Police arrive and we both enter the store to identify him. It didn’t take long for us to find the guy, standing in the magazine section, pretending to read an upside down edition of the Times, sweating profusely, and practically wheezing.  He then tried to run from the police. Seriously, I have no idea where he got the energy… On his second run, he was (un) lucky enough to knock an officer to the ground. That officer was in no mood to run; Hunter was, though. That Belgian Malinois broke out of the patrol car faster than American Pharoah at Belmont Stakes. It was awesome. I’m also 10/10 on throwing a thief in jail on Christmas Eve. In case you were keeping score.

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COMBATTING RETURN FRAUD WITH CUSTOMER SERVICE

January 18, 2016 by Leave a Comment

theft (13)I’m seeing a huge spike in return fraud, so I’m betting you are too. For my particular stores, it is a huge problem. I will venture to say that it is the biggest and most financially impactful fraud scheme that is affecting my stores; and it’s only getting bigger. I’m fortunate enough to have a small team within our LP department that do nothing but review returns data. When they see something that is indicative of fraud, we actually cancel the store credits unless proof of purchase can be verified. We are poised to break 5 million dollars in suspended store credits this year. Insane.

My company only operates a little over two hundred stores, so that number is quite high. That is 5 million dollars in external theft that we recovered. I have my own theories on why this is a growing problem and a few solutions that any retailer can adopt to help limit your exposure to this madness. Would you believe me if I told you that most return fraud can be prevented with a simple “hello”?

Customer service is the most proven and effective way at deterring criminal activity in your store. A simple greeting, acknowledgment and/or engaged employees can, and will stop most would-be thieves. If your employees are engaging with all of your customers, this will prevent the theft from ever happening. If there is no theft of product, then there can be no refund of stolen goods. See where I’m going with this?

Every store that I visit and audit that I conduct, it seems as if I’m noting some challenges in the customer service department. Do you really think that your product is that great and your prices that low, that the customer absolutely must purchase their item at your store? If you think this, then I hate to be the one to tell you this, but you’re wrong. Customer’s come to your stores for more than just an item; they want to feel as if they are appreciated. It’s your job to make that happen. Likewise, by providing exceptional service, you are not only increasing your sales, you are reducing shrink.

Here’s a case study to help drive home my point:

Susie G is a thief. She’s only hooked on heroin and needs a daily fix. She’s unemployed so she resorts to stealing to fuel her drug addiction. She’s learned from some of her buddies that “Store X” doesn’t have strong controls and it’s super easy to steal from them. Even better, you can come back later and return the stolen merchandise and they’ll give you a gift card. (How nice!) She learns that she can easily sell that gift card for quick cash in the parking lot, or at a local pawn shop. Thus, a small criminal enterprise is born. Susie then tells all of her heroin addicted brethren and before long, groups of 5 and 6 are targeting your store and committing return fraud on a daily basis.

Why did Susie and her friends find it so easy to steal from you and not the store down the road?

I’m not going to put an answer here. I want you, managers and owners to stop for 10 minutes and really think about this question. What can you do to prevent this in your store? Can you up your customer service game? The answers may surprise you.

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Merchandise Return Fraud

December 30, 2015 by Leave a Comment

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Shoplifting during the holidays is a big problem for retailers in the United States.  The holiday season brings more customers into their stores, but shoplifters know this and they take advantage of this fact to go into the stores and walk out with hundreds of dollars in stolen merchandise.  But after the holidays, you are dealing with another kind of fraud. Merchandise return fraud has seen an increase over the previous year, and retailers now have to deal with this problem after the holidays are over.

For more about this and other topics, follow the links below.

Post-Holiday Merchandise Return Fraud

Retail theft statistics show that the vast majority of returns are legitimate and part of doing business as a retailer.

Returns and return fraud are a big issue—and getting bigger. In 2014, $284 billion worth of retail merchandise was returned in the United States,according to the Retail Equation. That represented a 6.2% increase over the prior year, and 2015’s numbers are expected to grow even higher. Brick-and-mortar stores report returns in the 5-10 percent range. E-commerce retailers report numbers averaging 10-15 percent, with returns of apparel running as high as 20-30 percent. The research firm IHL Group estimates that, overall, returns cost retailers 4.4 percent in revenue that is lost on items that can’t be resold or must be discarded.

Within the retail loss prevention community, when returns are mentioned, most focus on return fraud. To be sure, it is a huge issue with volume estimated at $9.1 billion, again according to The Retail Equation. When return abuse is added in, that number jumps to an estimated $15.9 billion. But, as large as these numbers are, it is estimated that return fraud and abuse only make up about 6.1 percent of returns. So 94 percent of all return transactions (equating to $245 billion) are legitimate.

Retailers Estimate Holiday Return Fraud Will Cost Them $3.8 Billion, According to NRF Survey

WASHINGTON, December 19, 2014 – Techniques and processes put in place to thwart criminal activity around retailers’ return policies continue to be put to the test, and with steadily improving retail sales, even more is on the line when it comes to losses from return fraud.

According to the National Retail Federation’s 2014 Return Fraud Survey* completed by loss prevention executives at 60 retail companies representing grocery, department, discount, specialty and small retailers, the industry will lose an estimated $10.9 billion to return fraud this year. Additionally, of those surveyed, retailers estimate $3.8 billion will be lost to return fraud this holiday season alone, up slightly from last year’s $3.4 billion. Overall, retailers polled estimate 5.5 percent of holiday returns are fraudulent, similar to last year’s 5.8 percent.

“Today’s sophisticated technology does well keeping criminals at arm’s length but often isn’t enough to completely stop the unethical practices of organized and individual retail fraud occurrences,” said NRF Vice President of Loss Prevention Bob Moraca. “Return fraud has become an unfortunate trend in retail thanks to thieves taking advantage of retailers’ return policies to benefit from the cash or store credit they don’t deserve. Additionally, many of these return fraud instances are a direct result of larger, more experienced crime rings that continue to pose serious threats to retailers’ operations and their bottom lines.”

Reflects on How a Shoplifting Charge Changed Her Life

Shoplifting consequences that ended a 35-year career in journalism.

On February 11, 2012, officers of the Tucson Police Department cited former Tucson KVOA news anchor Martha Vazquez on a shoplifting charge. According to the report that was filed, Vazquez was cited for shoplifting at the Dillard’s in the Tucson Mall after a loss prevention officer observed her conceal an Eileen Fisher jacket value at $338.00. After she was detained, a search of her belongings also yielded a pair of Kenneth Cole sunglasses valued at $30 that had also been shoplifted.

Vazquez said that after the shoplifting charges ended her 35-year career in broadcast journalism, her life hit “rock bottom.” She resigned her prominent position, sank into a deep depression and left Tucson for Washington State. Now, Vazquez says the time that she spent out of the public eye in Washington after her incident in 2012, was “a healing journey.” She is now back in Tucson; is being treated for depression and says that she wants to help others.

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Employee Theft

December 16, 2015 by Leave a Comment

theft (2)Shoplifting costs the retail industry million of dollars daily.   The harm done to the businesses and the economy in general is socially and economically harmful, but employee theft hurts the company’s culture, damages trust between owners and employees, and financially are responsible for billions of dollars that companies lose due to this horrible crime.  For more about this topic follow the links below.

A New Employee Theft Study

An Analysis of Employee Theft at a Specialty Retailer.

When I was a doctoral graduate student at the University of Minnesota during the late 1970s, I began conducting research on employee theft. At the time this was an area of criminology that was virtually unexplored. I found that it was very hard to study this subject then, since few retailers were willing to let a social scientist have full access to the records on this subject. Over forty years later, the scholarly literature on dishonesty in the workplace is still understudied and poorly understood despite the best efforts of a handful of researchers.

As such, I am always on the lookout for new and cutting-edge research on this topic. This month I wish to share the results of a quality employee theft study that was recently published as a doctoral dissertation. The author is Dana N. Baxter. She completed her research while studying under Dr. Dennis Giever at Indiana University of Pennsylvania. She finished her dissertation this past spring and graduated in May. She is presently an assistant professor at Davis and Elkins College in West Virginia.

A Snapshot of Employee Theft in the US

The majority of employee thefts are occurring in organizations with 500 employees or less. The sizes and types of thefts vary by industry, but smaller organizations across the spectrum exhibited high incidences of embezzlement overall.

The unfortunate reality of employee theft is every organization is at risk.

When we looked at the totality of federal actions involving employee theft over the calendar year, nearly 72% involved organizations with fewer than 500 employees. Within that data set, we found that four of every five victim organizations had fewer than 100 employees; more than half had fewer than 25 employees. Is there a connection between the size of an organization and the size of the loss? Our research suggests that there may be. While some of the largest losses occurred in organizations with fewer than 50 employees, in the aggregate, we note the following:

U.S. retail workers are No. 1…in employee theft

Light-fingered employees cost American stores (and consumers) more than shoplifters do.

It’s almost Groundhog Day, but for retailers, the holiday season is finally winding down.

“The four months from October through January are when stores see not just their biggest sales volume of the year, but also the most returns and exchanges,” says Ernie Deyle, a 30-year veteran of the retail loss-prevention wars who leads the business consulting practice at London-based data analytics firm Sysrepublic. “Unfortunately, the same four months account for about half of all annual shrinkage.”

That shrinkage, made up of missing goods from shoplifting and other causes, costs U.S. retailers about $42 billion a year, according to the latest Global Retail Theft Barometer, an annual industry study led by Deyle and inventory management firm Checkpoint Systems.

 Shoppers pay the price for such theft. The cost of mysteriously vanishing merchandise comes to $403 annually per U.S. household.

Of course, retailers everywhere deal with shrinkage, but there is one big difference between the U.S. and the rest of the world: Globally, dishonest employees are behind about 28% of inventory losses, while shoplifters account for a markedly higher 39%. Not so stateside, the study says, where employee theft accounts for 43% of lost revenue. That’s about $18 billion, or $2.3 billion more than the cost of five-finger discounts taken by customers.

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Preventing Shoplifting This Holiday Season

December 14, 2015 by Leave a Comment

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By now the holiday season has been in full force for a few weeks, and the stress your management team, employees and security personnel are feeling is a bit overwhelming.  Shoplifters during the holiday season are abundant, and police and retailers try to be more vigilant and proactive by implementing security measures during this time than at any other time of the year.  Follow the links below for more information about this and other topics.

Police step up efforts for holiday crime

As the holiday season gets under way, local police are gearing up for the all-too-predictable spike in property crime.

Hanford police Capt. Pat Crowe said officers will be stepping up their game over the next few weeks to deter vehicle burglaries, robberies and other crimes typical of this time of year.

“Every [patrol] shift was tasked with coming up with their own holiday project,” Crowe said.

Crowe said those projects include probation and parole sweeps focusing on individuals with known histories of gang activity, drug-related offenses and property crimes. Foot patrols and motorcycle units will also increase their presence at the Hanford Mall and other major shopping centers.

“Our main focus is to be visible and hopefully deter criminals from doing what they’re going to do,” Crowe said.

Lemoore Police Chief Darrell Smith said each of his department’s patrol shifts also devised a plan to tackle holiday crime. The result was a number of special operations that will unfold through New Year’s Eve.

Police offer tips to stay safe during holidays

If you’re tempted to share your holiday plans or photographs of Christmas loot on social media, local law enforcement officials want you to think twice.

“We live in an age where people put so much information out there about themselves,” said Cindy Kozerow, crime prevention specialist with the Lynchburg Police Department.

“Do not announce on Facebook, ‘Hey, we’re going to grandma’s for the holidays,’ because what that says is ‘Hey, my house is empty, so come and steal my stuff.’”

She explained how the holidays present a unique opportunity for thieves looking to capitalize on people’s good will and sense of safety in their own homes.

Checking in at stores on social media pages or opening window curtains at night to show off decorations lets potential thieves know when your home is empty, and gives them a glimpse of goods stashed under your Christmas tree.

‘Shoplifting Season’ for local businesses

Rogue River, Ore — The holiday shopping season can mean trouble for local businesses as big crowds come in but some say they’re sick and tired of getting ripped off. Sometimes it’s as simple as a Facebook post.

In Rogue River the police are working with one local business to make sure their products stay on the shelves and don’t fall into the hands of thieves.

“We’re a small store, and it really hurts us,” said Justin Norris.

At Rogue River Pharmacy and variety store shoplifting is something assistant manager Justin Norris has to deal with far too often.

“Lately we’ve had a problem with people from out of town coming in and shoplifting,” said Norris.

Rogue River police are looking to put an end to it by posting pictures online of suspected shoplifters and suspicious persons, one of whom confronted a uniformed police officer before leaving empty handed Tuesday.

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Shoplifter Quick Tips

December 11, 2015 by Leave a Comment

Sshoplifting1ince you are in the middle of your Christmas selling season and do not have much spare time I wanted to give you a very brief list of important shoplifting prevention tips:

  • Impulse, amateur and professional shoplifters are all deterred by customer service. If you suspect shoplifting, pour on the customer service. They will get the message.
  • Shoplifters tend to hit when you are busy and not paying attention. Do not give them the opportunity, they will exploit it.
  • Some shoplifters work in teams. One person will distract as many of your staff as they can allowing their partners time to steal.
  • Greet EVERYONE who enters your store! Well, established studies have shown that a solid verbal greeting such as “Welcome to XXXX” WITH brief eye contact will deter most impulse shoplifters.
  • If you see or suspect a person has concealed your merchandise, customer service them “to death”. Try one of these:
    • “May I help you?”
    • “Can I show you a _____________ to go with (concealed item)”?
    • “Can I hold (concealed item) for you at the register?”
    • “Will this be a charge or cash sale?” 
    • “May I ring this purchase for you?”   
  • At checkout EVERY CUSTOMER should be asked, “Is there anything else”. There are 2 very good reasons for this question:
    • Legitimate customers may remember an item they forgot. Can you say “add on” sale!?!
    • Impulse and amateur shoplifters may feel anxious or guilty about what they have done. Or they may fear that you know or saw them and produce a concealed item.

I hope this helps you this season. Please let us know, if we can assist you. FYI Checkpoint Systems has just released the new N10 EAS system that fits on your door frame. We have it! It is an awesome system at an awesome price.

Happy Holidays!

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HOW SECURE IS YOUR BACKDOOR

December 11, 2015 by Leave a Comment

LPSI EVOLVE-Store Mobile AppWhere are you losing the most to employee theft? Is it cash through the point of sale, bogus invoices, or fraudulent discounts? If you’re like most retailer stores, it’s more than likely a little bit of each. One area that is so often overlooked is our back doors. If not properly controlled, you can lose tens of thousands of dollars’ worth of merchandise before it even hits your sales floor.

Just this past year, I worked a case in one of my high shrink stores. The managers were reported huge losses in electronics items and hunting accessories. After an investigation was conducted, we were able to determine that the product had never made it to the shelves. After a few days of surveillance, it was clear that a handful of receiving associates were operating their own small business. Product was simply taken off the truck and taken right out the back doors.

Just a few months ago another store was missing approximately 10,000 units of ammunition. We tracked this shipment from our warehouse, where we had video of it leaving the dock, as well as video of the merchandise being unloaded at the store. Video also showed a receiving employee wheel it out the back door on a pallet and load it into his personal vehicle.

I could sit here for hours recalling case after case, where employees exploited physical security failures around our back doors. In just about every single case, there was a violation of our company’s policy that led to the associate being able to steal the product. As managers, you have to take ownership of this area, or else it will bleed you dry.

First, ensure that only managers have a key to the back door and that a manager is the only one using those keys! All too often, I’ve seen managers give their keys to a “trusted” associate, in an attempt to delegate tasks, only to have that associate rob them blind. Your managers are key holders for a reason; and that trust should only stay with them.

When manager does open the back door, they should stay at the doors. I’ve had cases where a manager would step out of the warehouse for a minute with the door open, and an employee would run product out. If the door is open, the manager stays posted until the doors can be locked. This is a non-negotiable item for my company. Unsecured and unattended back doors can get a manager a coaching in their file. It’s that serious.

Plenty of stores don’t have the luxury of a compactor and have to take the trash out to an open-top dumpster several times a day. This is a great time for employees to stage product inside of trash bags. To prevent this, you should mandate that all boxes be broken down prior to the door being opened. In addition, use clear garbage bags instead of solid black. This lets you see what each bag contains before it goes outside.

Securing the back door, to me, is just as important as any other physical security measure used in the store. I can use all the EAS devices and anti-theft tools in the world, but they won’t be effective if the product is flowing out of the back door. This is one of the biggest areas of potential loss for any store and I can guarantee that if you have any weaknesses, or lapses in policy, a dishonest employee will find them and they will exploit them. Do yourself a favor and make sure your back door policy is locked down this holiday season.

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How to Find a Good Security Consultant

December 11, 2015 by Leave a Comment

meetingpic.In today’s business climate it’s impossible for an owner or manager to have all the knowledge and experience needed to run a successful company.  There’s too much new and changing information (i.e., technology, taxes, healthcare, government regulations, legal liability) for any one person to keep up, let alone have a working understanding.

That’s why even very small businesses are using temporary specialists more often than ever before.  Outside experts fill the many gaps which any business has: lawyer, marketer, accountant, consultant, business analyst or web designer.  Increasingly, one of the requirements for many companies is security consulting.

The growing need for risk assessments and security measures is an area of concern most companies have never had to face.  It’s an area which requires expertise beyond what the average manager or owner can be expected to have.  It just makes sense to outsource it. 

But, how do you find a good security consultant?  As any good security consultant will tell you — due diligence is the key.  To get you started here are a few tasks to do and questions to answer for each candidate.

* Interview more than 1 person, 3 is usually enough to find the right one.

* Do they welcome or hinder your due diligence?  A viable candidate will endorse your actions.   

* Check their references and credentials.  Also, depending on the project you have in mind, consider doing a background check.

* Evaluate and validate their work experience.  Do they have the expertise they claim to have?  There are many types of security issues.  Does their knowledge fit your problems? 

* Are they listening to you and your people?  Are they offering solutions before they understand the problems?  Are they trying to up-sell you?

* Do they demonstrate responsibility by following up when they say they will (i.e., bids, phone calls, appointments, texts, emails)?  If they’re not responsible when they’re trying to sell you, it usually gets worse during the project.

* Is there a contract?  There should be one that’s clear and easy to understand.

Security issues — workplace violence, cyber attacks and breaches, employee theft, shoplifting — are continuing to grow.  It’s time to think about how they affect your business and take steps to address them.  These are concerns that aren’t going to go away. 

Nicole Abbott is a professional writer who’s had over 100 articles published.  She’s a business consultant and former psycho-therapist with over 20 years of experience in mental health, business and addiction.  She’s a coach, lecturer, trainer and facilitator.  She has conducted over 200 workshops, trainings, presentations, seminars and college classes. 

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