Retail Loss Prevention: How to Get Rid of Shoplifters

by Shield Security

Aug 29, 2017 4:30:00 PM

buffalo ny commercial securityThe greatest threat to your commercial or retail business isn't always an economic down slide or a lack of loyal customers; the biggest threat to a retail owner's profit margins could hit from within your walls, in the form of shoplifters, employee theft, and burglaries.

Crippling inventory shrinkage can put you out of business, which is why it's important to keep up on retail loss prevention and implement the straightforward strategies that dis empower shoplifters and other criminals.  For small business owners, recovering inventory and preventing unnecessary loss can be the difference between owning a thriving business or having to close your doors for good.

Eliminate Inventory Shrinkage By Stopping Shoplifters in Their Tracks

First, it's important to understand what inventory shrinkage is and the various ways it occurs.

Inventory Shrinkage

Shoplifter at Clothing Store.jpgThis term refers to inventory items you have online or in your records, versus the physical count of on-hand merchandise. Nobody's perfect so a certain amount of shrinkage is normal, as a result of internal or external loss, breakage, operational errors and so on.

According to the National Retail Security Survey (NRSS) results, released in June 2016, inventory shrinkage in 2015 accounted for 1.38% of retail sales, which adds up to roughly $45.2 billion dollars. Unfortunately, retailers who participated in the survey reported inventory shrinkage increased from the previous year.

While inventory shrinkage is an inevitable part of running a business, business owners and managers should be highly-attuned to the rhythms and patterns within their own brick-and-mortar stores and should have an actionable asset protection plan to minimize losses.

Tips for Minimizing Non-Theft Related Shrinkage:

  • Establish a loss prevention team when your business grows beyond a single storefront. This team is held accountable for losses throughout the entire supply chain, making it a holistic process.
  • Focus on counting and inventory processes. The large majority of internal shrinkage comes down to processing failures. Be methodical and timely with counting processes and use technology to your advantage.
  • Engage senior managers while simultaneously making shrinkage more visible across the employee spectrum, ensuring each employee understands s/he has a stake in the system.
  • Take advantage of digital data collection and analytics, including analysis of POS transactions, till voids, returns rates, zero sales data, employee engagement, and store adjustments data, remaining alert for discrepancies.
  • Identify the greatest opportunities for sales margin growth that also eliminate losses.

Organized Retail Crime

Organized retail crime is a risk to any retail business owner - even the very small ones. It is defined as, "... professional shoplifting, cargo theft, retail crime rings and other organized crime occurring in retail environments...These criminals move from store to store and even city to city. Working in teams, some create distractions while others steal everything from infant formula to DVDs. Often, they are stocking up on specified items at the request of the organized crime leader."

Retail Shrinkage.jpgIn other words, a single shoplifter - or even a pack of teens or adults who've made shoplifting an art form - are not considered organized retail criminals. True organized retail crime has a leader, a group of followers and well-executed plans.

According to the National Retail Federation's (NRF) 2016 Organized Retail Crime Survey, retailers lose approximately $30 billion each year to organized retail crime.

Tips for Preventing Organized Retail Crime

  • Use a retail security provider who understands the threat of ORC. Other small businesses in your area may be able to contract with the same security provider and share expenses.
  • Get familiar with your community and research crime rates and the history of organized retail crime in your area - via conversations with fellow business owners as well as local law enforcement.
  • Monitor organized retail crime trends and closely monitor items more likely to attract criminals.

Shoplifting

Dome Camera at Retail Store.jpgUnfortunately, shoplifting is an everyday problem. More than 10 million people have been caught shoplifting in the past five years, and yet statistics tell us that habitual shoplifters are only caught about 1 out of every 48 times they steal. As a result, "professional" or habitual shoplifters are responsible for about 10% of total retail losses.

download free ebookHow to Prevent Shoplifting:

  • Meet with retail security professionals and install a security system that makes sense for your store, layout, type of business, threat level and budget.
  • Keep your store organized, tidy and with all items "faced" so it's easier to tell if a shelf has been swept.
  • Install mirrors, dome cameras, and annunciators, which make it easier for employees to keep track of clientele.
  • Use branded security signage, which statistically reduces shoplifting. Place signs in elevated locations, where shoplifters tend to look for surveillance equipment.
  • Greet each customer as they walk in the door to let them know you're paying attention.
  • Adequately staff stores and train employees to be alert to shoplifting tactics - i.e. working in groups to distract cashiers while swiping merchandise, price tag swapping, ducking merchandise into purses, umbrellas, backpacks, strollers, etc.
  • Have a code so employees can swiftly alert cashiers/managers to suspicious activities.

Employee Theft

Also known as internal theft, employee theft is the most heartbreaking of all. Unfortunately, this accounts for about 35.8 % of inventory shrink, making it the second-largest contributing factor after shoplifting.

A shocking statistic: 75% of workers admit they've stolen from an employer at least once; 37.5% have stolen from an employer two or more times.

Tips for Preventing Employee Theft:

  • Use a buddy system. Employees should never be alone in the store, particularly during opening and closing procedures. Having an extra set of eyes drastically reduces employee theft.
  • Utilize video surveillance. HD surveillance is affordable and employees are significantly less likely to steal if they know they'll be caught on camera. Surveillance should be established at tills, in storage areas, loading areas, dumpster areas, etc.
  • POS systems should flag potential fraud such as excessive voiding of sales, returns, refunds, etc.
  • Build relationships with employees. It's much easier to steal from a stranger and/or someone you feel doesn't value you.

Robbery & Burglary

Convenience Store Robbery.jpgRobberies occur when a person uses threats and/or force to steal; burglaries occur when a person unlawfully enters a building with the intention of committing a crime. Together, the rates of retail robbery and burglary - outside the typical convenience store hold-up - are on the rise.

Tips for Preventing Robberies and Burglary

  • Flood your store with light, both inside and out, especially in the evenings and off-hours.
  • Use a reputable security company to establish security protocols that make sense for your business.
  • Implement signage so criminals understand they'll be caught on HD cameras.
  • Keep minimum amounts of accessible cash in tills and implement safes with delayed response times since most burglars don't want to wait around.
  • Use silent alarm systems and form relationships with local law enforcement.
  • Train employees to sweep the store - including bathrooms - to ensure nobody's hiding and check/double-check windows and doors are locked.
  • Keep banking and money moving sporadically, so patterns are unidentifiable.

Learn more about how to protect your business from merchandise and revenue loss with our free ebook Essential Guide To Security Cameras.  Or contact SHIELD for a review your current security protocols.

Headquartered in Buffalo, NY, SHIELD Security was founded over 30 years ago by Ken Jezioro, a police officer and investigator with 28 years of law enforcement experience.   Since then SHIELD has been protecting businesses and homes in the Buffalo area and in cities across the U.S.

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Topics: Retail Security