Inventory shrinkage is a problem for every retail business. It is probably a bigger problem than most retail owners realize. A recent National retail Security Study showed inventory shrinkage represents 1.47% of retail revenue, which translates into $44 billion in annual losses.
While each company will approach loss prevention differently, every business should have a loss prevention culture and a clear plan in place. In a report titled “The State of Loss Prevention in Retail: Controlling Losses and Maximizing Profits” published by the Aberdeen Research Group, retailers that implement loss prevention strategies see a dramatic reduction in fraud-related operational costs which result in the multifaceted benefits of enhanced profit and customer satisfaction, and increased consumer and employee safety.
If you want to improve your loss prevention culture here are some successful strategies:
Develop a Loss Prevention Team
Preventing internal and external loss requires implementing many strategies in many different areas. Having leadership and a well-trained team to back up that leadership can ensure that loss prevention protocol adherence.
Develop a Systematic Protocol
Empower your business by putting a systematic protocol in place, and make every employee aware of that system as well as their responsibilities in implementing them. Make sure this system includes what to do if theft or fraud occurs.
Get Every Employee on Board
Make loss prevention part of every department and process, from ensuring the correctness of inventory delivery to managing inventory on the floor. Talk about inventory protection during team meetings and provide proper training.
Publish Analytical Data on the Company’s Losses Regularly
Rather than just track data on your losses, make that information available to the employees. Making employees aware can help include them in the process and inspire better processes and practices.
Train Employees on Loss Prevention
Loss prevention is much more than preventing internal theft; it is also preventing external theft and preventing fraud-related activities. Provide employees training
Install Security Camera Systems
Visible security systems reduce the incident of theft overall and can be very valuable in spotting and proving both internal and external theft. Cameras covering registers can reduce and deter point-of-sale (POS) fraud.
Install Alarm Systems
Alarm systems can prevent intrusion and theft during operating and non-operating hours, as well as alert employers should there be a break-in.
Use Information Provided By Security Cameras to Improve Processes
Physical security can do a myriad of things, like analyze traffic patterns, dwell times, and choke points and all of these things can impact theft. Measure your video data against other analytical data, such as what departments experience the most theft, or what makes an area most vulnerable to theft.
Install Access Control Systems
Limit access to certain areas or to critical inventory with access control systems. By limiting the amount of people that have access to a particular area you reduce the opportunity for theft.
Hire Security Guards
Security guards serve as a wonderful, visible deterrent to any crime. Security personnel are also dedicated to one task and less likely to be distracted.
Train employees to engage each customer. Theft occurs less in establishments that have great engagement, which for a thief means fewer opportunities.
To guard against chronic and emergent sources of loss, retailers need to be proactive in implementing loss prevention strategies. Video surveillance systems and access control systems not only help identify problems and reduce theft, they add value to the top end of the company by improving productivity, enhancing safety, and much more. If you have questions about how to implement security systems into your loss prevention strategy, give us a call today.