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Loss Prevention, Risk Management and Theft

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Loss Prevention, Risk Management and Theft Businesses must deal with theft daily. There are two types of product theft, employee and shoplifter – PowerPoint PPT presentation

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Title: Loss Prevention, Risk Management and Theft


1
Loss Prevention, Risk Management and Theft
  • Businesses must deal with theft daily. There are
    two types of product theft, employee and
    shoplifter

2
Shrink is the enemy
  • Most retailers experience about a 2 shrink rate.
  • Department Stores 2.18 Drug Stores 2.33
  • Mass Merchants 1.82 Apparel 1.84
  • Hardware 1.98 Supermarkets
    .93 ?

3
Shrink is missing product
  • After an inventory, shrink turns up on the
    closing inventory as a negative number. It is
    theft if it is still not found.

4
Supermarkets have half the shrink as other
retailers
  • Two reasons
  • People prefer not to steal food, as opposed to
    electronics or DVDs.
  • Employees are treated better in the supermarket
    business compared to other retailers.

5
Up to 90 of all product theft is from employees
  • Employees know where the good stuff is and how to
    get it out of the business.

6
According to a University of Florida study,
  • Over 1/3, 35, of all employees say that they
    have stolen from their employer.

7
The most common way in which employees steal is
  • Discounts to friends and family. Hey hook me
    up!

8
To control employee theft,
  • There is five things businesses can do.
  • Improve the quality of your employees
  • Participation Management
  • Awareness programs
  • Reward Systems
  • Control employees

9
Improving employees means
  • Drug test employees. Employees with drug habits
    tend to steal.
  • Background check employees. People who have
    stolen once might steal again.
  • Require good interviewing practices.
  • Have credit checks on employees. People who owe
    a lot of money tend to steal.

10
Participation Management is
  • Is a theory developed by W. Deming a Columbia
    University Professor. To quote Deming the theory
    works on the belief that Dogs dont bite the
    hands that feed them.

11
In Participation Management, Employees are to
feel as though they are part of management.
  • Businesses should
  • Pay employees better.
  • Require that all employees make suggestions
    regularly.
  • Give employees great job titles
  • Employees are to participate in stock purchases
    and profit sharing

12
Awareness Programs
  • Talk about what would happen if caught stealing.
    What would your mother, wife or children think
    if you were fired for stealing?

13
A Reward System pays
  • Employees for helping management to find thieves.
    A 100.00 reward is nothing for a business to
    stop what might be stolen.

14
A Reward System stops employee theft by
  • Suggesting that employees might tell management
    about what they saw. A Reward System should be
    done in conjunction with a 1(800) for anonymous
    tips

15
Control Employees
  • Employees should come in and out of designated
    doors
  • Employees should be allowed only in specific
    areas
  • Employees should never be given Keys (Only
    Management should carry keys)

16
Control Employees
  • Employees should not be able to come in on their
    day off.
  • Employees should never be given combinations to
    safes.
  • Cashiers should have personal sign-on passwords
    and tills should be counted in and out after
    every register change.

17
Shoplifting
  • Is a problem, but remember employee theft is a
    bigger threat.

18
Most commonly shoplifted items are
  • Razor blades and shaving products.
  • Cosmetics, especially face creams and perfumes.
  • Wii and other gaming systems.
  • Alcohol.
  • Meat.
  • Satellite navigation, or GPS, systems.
  • Brand-name clothes, purses and accessories.
  • Infant formula. Some stores lock up powdered
    formula, which is not only sold on the black
    market at a higher price but used to cut drugs.
    Who knew?
  •  Watches.

19
According to a study by the National Retailers
Association,
  • When Shoplifters and Retail Managers were asked,
    on a scale of 1-10,(10 the most effective) rate
    the effectiveness of these theft deterrents?
  • They responded Retailers
    Shoplifters
  • Product EAS tags 2
    1
  • Trained employees 1
    2
  • POS Systems 3
    1

20
Shoplifting Tool effectiveness
  • They responded Retailers
    Shoplifters
  • Closed Circuit TV 5
    4
  • Fitting room staff 6
    5
  • Mirrors 8
    2
  • Security Guards 4
    8

21
In conclusion, Mirrors, according to retailers,
  • Worked well in catching shoplifters. Shoplifters
    are not aware of this.

22
Secondly, that shoplifters are scared of security
guards
  • And that retailers are not realizing this.

23
According to the FBI
  • Shoplifters are grouped into five categories
  • Adolescence, teens and young adults
  • Bums, Vagrants, Alcoholics and Drug Addicts
  • Impulse
  • Professionals
  • Kleptomaniacs

24
Teens are the most common
  • Up to 80 of all Shoplifting is done by teens.
    Shoplifting is a gateway crime into other
    criminal activity.

25
Bums
  • Are probably the easiest to catch. They often
    smell bad and everyone saw them take what they
    are stealing.

26
Impulse
  • These are probably respectable members of society
    that just gave into temptation.

27
Professional
  • You may never meet a professional shoplifter.
    They are so good, they rarely get caught.

28
Kleptomaniacs
  • Commit 6-8 of shoplifting. Its a real
    psychological disease recognized by the APA. If
    you know a Klepto, you might receive lots of
    little gifts.

29
How should a business slow shoplifting?
  • 1. Use devices and personnel, such as Mirrors,
    CCTV, Security guards and Point of Sale
    conduits.

30
2. Use Audible Messages
  • Let shoplifters know that you may be watching
    them by announcing Security to the liquor
    department even if Security is not in the store.

31
3. Train Employees
  • Teach your people what is typically stolen from
    the store and how they are stolen. Every business
    has a different set of circumstances.

32
4. Create your store layout and design with
deterrence in mind
  • Place the most often stolen items near employees
    and the management. Lock-up high theft items
    such as liquor and cigarettes.

33
Before apprehension of a shoplifter, you must
  1. See them do it.
  2. Prove that they did not buy it.
  3. Prove that it came from your store.
  4. Prove that there was an intent to steal.

34
Most police departments will
  • not come out to pick up a shoplifter, unless
    he/she has left the store. (To prove intent)

35
Never go out after a shoplifter
  • Alone!
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