The Bunker Blog

These tough economic times create real challenges for all of us in the loss prevention industry. Many retailers are closing doors, meaning lost jobs, including loss prevention jobs. Those in the industry who are still working are, in most cases, being asked to do more with less.

With retailers looking to cut costs, loss prevention programs can be viewed as non-essential, and therefore be either cut back or altogether cut from the budget. Retailers are looking to save money where ever possible, and loss prevention is in a position to either show real savings through shrink reduction or face cutbacks in many cases.

One would think that the increase in criminal activity against retailers would secure a position for loss prevention professionals at every retailer, but this may not be the case.

SecurityInfoWatch.com posted an article by Mark Doyle of Jack Hayes, Intl today that summarizes the latest Annual Retail Theft Survey. Not surprisingly, the survey found that overall apprehensions were up 10.8% over 2006, and recoveries were up 9.73%. What was surprising was that the average case value was actually slightly down, at -0.33%.

According to a survey conduct by Aberdeen Research back in October 07, 60% of retailers reported shrink of 1.75% or more for that year. And friends, that’s where the real bang for the buck exists. Having an increase in cases is great, and indeed does help to reduce shrink. But if the shrink percent is high, then something is not working.

This same survey also found that retailers see four major challenges when it comes to their shrink reduction strategies. They are listed below in order of importance:

1. Lack of Employee Training On Loss Prevention Procedures
2. High Incidence of Internal Theft
3. Store Location Demographics (Crime Rates, etc.)
4. Organized Retail Crime

You’ll notice that the top challenge or concern is training. If associate awareness is low, shrink will be high. Loss Prevention must go beyond the weekly meetings and become intimately involved in the LP training in stores. That means one on one, personal training of key employees who will pass along the information and help to build a culture of awareness.

Next on the list is Internal Theft. Since 40 – 50% of shrink is attributed to employee theft or fraud, it only makes sense to put the investigative focus in this area. Shoplifters are a problem, but not THE problem in most locations. The biggest issue employers face when it comes to losses is the fact that up to 30% of their employees are stealing from them at any given time.

Store location issues are a tough problem. I recommend regular risk assessments. That means going to the local police department and requesting property crime statistics. For about $10.00, you get a great deal of information that, along with your specific shrink results, will help you customize your strategy for shrink reduction. I also recommend networking with other local Loss Prevention departments and sharing information about habitual offenders, high theft items, etc. Together, this information can really make a difference in how you protect your merchandise.

Finally, retailers are concerned about organized retail crime. There seems to be some debate in loss prevention circles as to just how much of a problem this is. On one hand, there are those who maintain that ORC is a huge contributor to retail shrink, and that the answer is to work with law enforcement to go after the leaders.

On the other hand, there are those who argue that, if proper training, awareness, and protection standards are in place, ORC is a minimal issue because the boosters are being stopped before they can seriously impact shrink.

Both sides make good arguments, and I think it will take some time before we see which approach makes the biggest impact on the problem.

So, loss prevention professionals face tough challenges in tough economic times. My goal here is to share the “big picture” concerns of retailers in general so that LP professionals can manage their workload and focus to make the biggest impact possible on the shrink in their stores, markets, etc.

But we also have to be keenly aware of what our companies’ specific goals, challenges, and concerns are. At the end of the day, it’s about the shrink. If you catch 1000 shoplifters and dishonest employees, but your shrink remains high and unchanged, then the focus needs to be re-assessed.

So, how about it? Do you agree? Disagree? Want to add your own thoughts? Please leave a comment so we can discuss.

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Three young ladies in Natick, MA, are facing serious charges after a bit of back-to-school shoplifting on August 31st. According to reports, Elena Shields (17), Sarah Shields (21), and Amanda Winkler (18) were arrested after being observed taking multiple items into a fitting room and then coming out with fewer items than they took in. The items were not left in the fitting room, and store loss prevention observed the girls put the merchandise into their car.
When Police arrived, they found items from several other stores in the car. All three girls were charged with larceny of property worth more than $250, receiving stolen property worth more than $250, and conspiracy to commit a crime.
It is a misconception by some shoplifters that, if they go into a fitting room to steal, they won’t be caught. Loss prevention departments are trained to observe fitting room activity and to gather the necessary information that allows them to make apprehensions, even when the shoplifter enters a fitting room to conceal the merchandise.
These girls found out the hard way that retailers are serious about protecting their merchandise from theft. They also made another critical mistake: They went to the well too many times. Like most thieves, they were greedy, and they victimized not one, but three businesses before they were caught.

Original Story

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For the past couple of weeks, I’ve been doing a lot of traveling. From routine visits to formal meetings to investigations, I’ve been putting on the miles. This “off-time” from keeping up with this blog gave me the opportunity to think about and identify my goal for this site. I want to approach it the same way I approach my training. I want to keep it REAL.

Relavant: I want to speak to my audience, not in LP terminology, but in real dollars and sense. I want my content to be relevant to their situation. That’s tough when you are just learning who your audience is, but by producing what I hope is quality content that is easily understood and applied in practice, I want to keep the blog relevant to all who read it.

Educational: One of my main goals is that my readers learn something new every time they visit. My goal is to help retailers save money and add to their profit line by reducing losses through shrink. Education is awareness. Awareness is the first line of defense against shrink.

Attitude: I like to add a little of my own attitude to my posts. That is why I post commentaries on current news articles that are related to shoplifting, employee theft, and shrink reduction principles in general. I always like to make sure a little bit of me comes out in every post. I also believe it is important to have the attitude of a winner if you expect to win.

Long Lasting: Although some of the articles posted here are very temporary in that they deal with current events and news related to theft, I do make every attempt to make each and every article memorable. I try to add my own experiences, successes and failures, to the mix so that the point made is memorable to the reader. I have posts from very early on that are still regularly visited, read, and commented on. That, I believe, counts as long-lasting content. As technology, trends, and programs change, so will this blog, but the core principles will remain.

So, my goal for my little piece of blogosphere real estate is to just always keep it REAL. If I can accomplish that, I can build on it to make the site a success.

So, what do you think? Is this blog REAL to you?

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