Retail Theft Prevention – Internal Theft Part 1

June 22, 2009

Here are a couple more tips to help protect your profits. Like all other tips/suggestions I’ve provided, these are to be considered “basics”, to be utilized with a specific regimen of policies and procedures that work best with your particular store/situation.

Internal theft is the largest source of shrink for retailers in North America, representing 46.3% of all losses, according to a recent study by the Center for Retail Research. My own experiences place it slightly higher;55-60%. The topic is a difficult one for most owners/managers to deal with, since it “accuses” their work family of dishonest practices. In addition, most owners/managers I’ve come into contact with are in denial;that is, they will not believe that anyone on their staff could be a thief. This denial, however, could end up costing their company a large portion of it’s profits.

Statistics on retail outlets show that, in general, there are three basic groups of employees :20% who are chronic thieves, 20% who will never steal and 60% who will steal if given the motive and opportunity.  The owner/manager who believes he/she has only hired the honest 20% is clearly in denial.

Three main factors contribute to Internal Theft:

1 )NEED  – The need the employee has for money/product, whether real or imagined.

2) TEMPTATION – The overwhelming feeling an employee has when placed around pilferable items, due many times to the feeling that the employee is “entitled” to supplement his/her income because of being “underpaid”, “not appreciated”, “treated unfairly”, or feeling that the company/store “will never miss it”.

3) OPPORTUNITY – If the employee feels the “need” as well as the “temptation”, he/she will usually look for the opportunity.

While you cannot remove the need, you need to protect yourself and your employees from the Temptation and Opportunity. Time and time again I’ve heard employees, after being caught stealing, saying “they made it so easy” or “you made it too hard to resist”.  Overall, the message is clear:the best defense is a good offense.  Insuring that your employees are well trained from the start, and are made to adhere consistently to established policies and procedures, will help minimize your exposure, as well as theirs.

More to follow….


Retail Theft Prevention – Cash Security

May 15, 2009

Here are a couple of tips to protect the cash within your stores.  Like all other tips/suggestions I’ve provided, these are to be considered “basics”, to be utilized with a specific regimen of policies and procedures that work best with your particular store/situation.

1) SAFES – A store safe should be kept locked at all times.  Although keeping them on “daylock” (locked, but a quick spin/last digit ID to open) may be convenient, consider the ease with which a thief can get to your cash.  Over the years I’ve received numerous calls, notifying me that the safe was emptied, during the business day, from a back room/office and the manager on duty had no idea how it happened.  Just because an office/backroom door is locked does not completely protect you;door locks can, in many cases, be easily opened.   Once the thief has made it into your “secure” area, you’ve made their job that much easier if they have simple access to the inside of your safe.

Of course, it’s always a good idea to limit the number of people with access to the safe. Drop safes help this; everyone can add, few can remove.

2)BANK DEPOSITS – Whether your cash/check deposits are made by you/your employees at a bank or picked up by a security service, make sure the monies are kept in the safe until the appropriate time.  Too often I’ve been informed of “missing” deposits that were left under a counter, in a drawer, etc., staged and ready to be taken to the bank.

Additionally, you should ensure that all your deposits are being made on a consistent basis (whatever your particular schedule/cycle is).   When your policy/procedure regarding deposits is not followed  you increase your exposure in many ways.

3)SAFE LOGS  – Logs should be utilized regularly to record the contents of  your safe. In my experience,  such logs should record the contents at Opening, Closing and whenever any Change of Shift occurs for individuals with access to the safe.

4)SAFE AUDITS – You, as the owner/manager, should perform Safe Audits on a regular basis, to ensure the integrity of the contents (working with the Safe Logs, if utilized). Additionally, I would recommend doing them at different times/days, so as not to set a pattern.

Lastly, I would strongly recommend, if dealing with a small to mid-size unit, securing your safe; that is, having it installed/bolted into the floor, wall, etc.  I have had numerous experiences where thieves, when breaking in after hours, literally picked up the safe and took it with them, only to have to deal with access to it’s contents on their own turf/time.

More to follow……


Retail Theft Prevention – External Theft Part 2

May 6, 2009

Here are a few more tips to help retailers keep their  profits in their  pockets and their merchandise  out of the hands of thieves.

“Potential” shoplifters to keep an eye on:

a)Those that appear nervous or repeatedly refuse offers of help

b)Those that wear large, baggy  clothing, especially unseasonable wardrobe  (eg – large coats when the weather doesn’t warrant it)

c)Those carrying shopping bags, large purses, backpacks, even umbrellas. Although they are common items in today’s world, you and your staff need to be aware of them at all times; large items of this sort lend themselves to easy concealment.

d)groups of youngsters; juvenile shoplifting is most often accomplished with large numbers convening in one place

e)Those that create “distractions” within the store. Shoplifters often work in teams; in order for the “pick up” person to remove the merchandise undetected, a “take out” person will attempt to distract the staff.

There are ways to protect yourself, or at least limit your exposure to these potential thieves:

1)Insure that ALL CUSTOMERS are GREETED upon entering the store! Real customer will appreciate the greeting, while potential shoplifters will know they have been seen and that you may be watching them.

2)Ask every customer at checkout “Is there anything else?”, then wait until the customer answers. Studies have shown that this question is one of the most effective deterrents to shopliftings;the amount of product pulled from purses, pockets, etc, at the last minute is astounding!

3)Do NOT leave the sales floor unattended! If it becomes necessary to leave the floor, keep the time spent away at an absolute minimum and, if possible, call to the customer(s) from the backroom, letting them know you’ll be there in a minute. The psychological advantage of them not knowing when you’ll return is extremely effective.

4)Never leave cash drawers unattended and/or unlocked. Sounds like a no-brainer, but I continually find myself in stores looking at open cash drawers while the employee has their back turned, bent down to get something from under the counter, etc.

More to follow…..


Retail Theft Prevention – External Theft Part 1

April 29, 2009

After many years in retail I have come to understand one thing:most small/mid-size retailers do not know how to properly protect themselves from theft, both internal and external. Granted, they may have installed a security camera that gets reviewed occasionally or done a quick, one-time inventory check to make sure the most expensive items are safe, but many times they forget the basics that end up resulting in potentially huge losses. There are a number of basics that, when done in a consistent manner and discussed clearly and openly with all employees, can add to any store/company security and, subsequently, their bottom line.

External Theft

1)Do your windows promote too much? While it’s important to tell the outside world what’s going on within, make sure you’re not covering a prospective holdup/break-in. If you can’t see outside from your cash register area others can’t see in (eg – police). In addition, make sure you leave at least some lights on overnight;thieves love anonymity.

2)Are your aisles clearly visible for/from your employees positions? Walk your store and determine if you can see your employees from most, if not all, areas;if you can’t, they can’t be expected to see a shoplifter.

3)Make sure your employees keep their heads up! Shoplifters love nothing better than an employee who isn’t looking at them. Also, let your employees know that, when looking up, if a customer is constantly looking at them they are NOT THAT GOOD LOOKING! The customer is keeping an eye on them to see if THEY are being watched. If this occurs, someone should approach the customer, on the floor, asking if they need assistance. Remember, since most thieves thrive on anonymity, they won’t like the offer of help and will probably move on and/or leave. One of the best shoplifting defenses: CAN I HELP YOU?

4)If you have an EAS (Electronic Article Surveillance) system, do you and/or your employees know how to react when it goes off? Many times I observe employees hearing it, looking at the customer who set it off and letting them leave the store, assuming a tag was missed. Shoplifters are very good at what they do;it’s their business! Don’t ever assume they don’t know, and have probably studied, your business habits. The oldest trick in the book is to purposely retain an item that is tagged (while concealing unpaid items), show it to the counter employee when the alarm goes off, then be allowed to go on their merry way! Be sure you have a set policy for employees to follow whenever the EAS alarm goes off;if you don’t you product is more than likely literally walking out your front door!

More tips to follow…..