Loss prevention veteran Eric White, from Wren Solutions, discusses how to localize your retail loss prevention strategy.
To retailers and businesses concerned with security, the holy grail of efficiency is to identify a replicable process that is effective when implemented at any location. Forever seeking the silver bullet, many retailers try to push effective best practices from top-down across all stores to achieve performance and consistency, especially where operations and loss prevention are concerned. These two areas are expected to have less regional variation than areas such as procurement, merchandising or customer service, which are highly dependent on regional preferences and logistics.
But as it turns out, the demographic profile of the area surrounding the retail store has everything to do with loss prevention. Location -- specifically whether the store is urban, rural or suburban -- plays into so many of the variables that impact risk and loss, that location-specific consideration and planning are required for successful loss prevention.
What's the big difference?
In today's global and connected world, many would expect for technology and processes to transcend location. But there are significant differences between the rural, urban and suburban environments. The people who work at the store differ in all three of these locations, as well as the people who shop there. The risks are different, as well as the resources. All of these factors greatly impact loss prevention. We will carefully examine why each of these elements is different and consider measures retailers in these different locations can take to mitigate the risks.
Urban retailers are generally faced with higher turnover than their suburban and rural counterparts. Many employees will stay with a job only on a short-term basis or will simply find other opportunities in a bustling job market. In rural markets, there are fewer employment opportunities and employees may be more likely to consider their position a long-term career. Suburban markets may have both long-term, career-oriented employees (such as young families established in the suburbs) and short-term temporary hires (such as young adults seeking employment while in school). Typically, managers in urban stores are newer to the role and less experienced. Suburban and rural residents tend to be families whose adults are seeking steady income and growth opportunities.
Urban stores may be in closer proximity to illegal activity. In most cities, drug trafficking, panhandling, prostitution or other crimes are common to the downtown area. These events could deter shoppers from coming to the store. There may also be fewer resources to turn to if and when incidences occur. While urban areas generally have sufficient law enforcement resources, they also have higher crime and incident rates, placing more of a burden on the system. Rural stores may have a challenge getting support from law enforcement simply because resources are limited and are a long drive away. In suburban areas, there may be more law enforcement officers, but the nature of the crimes that they deal with causes them to prioritize response and they are most likely to respond quicker to incidences more critical than crimes against retailers.
With easy access to the store via public transportation or simply heavy pedestrian traffic, urban stores are an open environment for loitering or panhandling from unwanted traffic. Customers are also different from a logistical standpoint in how they shop. Many are on foot and usually only purchase as much as they can physically carry from the store. Meanwhile, rural and suburban shoppers pull up in their SUV, ready to fill it. An urban store may experience heavy traffic during the lunch hour, Monday through Friday when area businesspeople shop during lunch, whereas a remote rural store may see traffic peak primarily late afternoon when school and work have released.
Managing the Differences
All of these differences must be managed and accounted for using resources available to the retailer. So what should retailers be doing to alter their loss prevention approach to mitigate the risks associated with each of these locations?
Create employee incentives
In light of higher turnover, a more transient workforce, and greater competition for nearby job opportunities, retailers in urban environments must work even harder than usual to engage their employees at every level. Retail employees who are empowered with authority and accountability are positioned to act and make a difference when and where it is needed most. Infused with a sense of their importance to the organization and a sense of responsibility, they tend to rise to the occasion and most often act on the retailer's behalf in very positive ways. Likewise, these employees are likely to take action to prevent, report or address loss problems in the store. Empowered employees may take the extra effort to pick up debris in an aisle that could potentially cause an accidental fall. They might also report an associate they suspect is stealing, looking to gain a personal reward, or possibly feeling a sense of loyalty to the retailer. Being empowered to make a difference, these associates feel trusted and are an important part of the business. The result could simultaneously be reduced loss and improved customer satisfaction. A sense of responsibility and accomplishment will also help ensure that associates don't immediately jump to the next job to earn a paycheck.
On the other end of the spectrum, in a rural setting, where fewer career alternatives are available, training programs and clear paths for advancement are in order. It is important that retailers evaluate the type of employee, their likely motivation and career path, and offer an attractive, engaging package to meet their needs and engage their interests. Incentive plans geared toward the type of employee help reduce turnover, instill a sense of responsibility, and encourage desired behavior, which can go a long way to reducing losses.
Put security first
In urban environments, even the walk from the store to the car can pose discomfort or danger. Retailers in urban environments should put additional security measures in place to protect associates and customers. Security escorts to the parking lot at night and increased monitored surveillance in parking lots and stairwells are a good idea. In urban environments, retailers need to ensure a secure environment not only on their property, but in the surrounding area as well. If the walk from the nearest bus or rail stop to the retail store is dangerous, shoppers will not come. Therefore, retailers must partner with local law enforcement to report and address crime and safety issues in the surrounding area.
A suburban store's greatest security concern may be a particularly hazardous intersection that is congested but does not have the appropriate traffic lights. This retailer may focus their energy on petitioning for municipal transportation authorities to install a stop light or may hire a security officer to direct traffic safely in and out of the parking lot during peak hours.
Crime Prevention Through Environmental Design (CPTED) means deterring criminal behavior through design principles that maximize natural surveillance and direct the natural flow of traffic. In urban environments, using plenty of artificial lighting and white paint in the parking lot or deck provides brightness and visibility, reducing the opportunity to perpetrate undetected crimes. By increasing signs and constructing fences and paving the general area, the retailer creates a sense of ownership of the property. A clean and graffiti-free area gives associates a sense of pride in the place they work and makes it clear to criminals that the property is owned and cared for. Using short hedges and landscaping and lighting to direct the path of traffic and leaving windows and views into the store unobstructed are all critical. In rural or suburban environments, municipal ordinances may restrict the use of exterior lighting and aesthetics become the predominant concern, sometimes overriding security principles in the exterior design. In these cases, crimes are often less prevalent and crime prevention techniques are focused on other measures.
Pick the right technology
Retailers should select technologies that address their most pressing security issues according to their location. In urban areas, access control should be used liberally to control entry and exit points. Call boxes in parking decks create a greater sense of security for shoppers and employees by enabling people to directly notify a security officer who can respond immediately.
In suburban or rural stores, more traditional theft deterrence tactics may be effective. Exterior video surveillance systems will likely be focused on property crime prevention, whereas surveillance inside the stores may focus on providing facial recognition shots for investigating shoplifting incidences.
Rural stores may be able to set surveillance equipment for recognition shots instead of identification. They may also invest in equipment and technology to help them manage emergencies for that critical time period before emergency responders can arrive at the scene.
Develop proactive processes
Loss prevention processes centered on the biggest potential problems can help mitigate risk. Urban stores should have clear policies on addressing loitering and panhandling, such as conducting rounds regularly to ask loiterers to leave the property. If the parking decks are a source of unwanted activities, the LP team may decide to monitor live video during peak traffic hours. If smash-and-grabs or organized crime are a problem, urban stores should place merchandise toward the middle of the store, away from exits/entrances and windows.
If suburban environments are subject to particularly high rates of "sweethearting", with school-aged employees cutting deals for their friends, the retailer should conduct random video reviews of cashiers at the register and set up alerts for suspicious behaviors or activities at checkout. If traffic accidents are a problem in the parking lot, they can consider installing cameras that have the capability to read license plate numbers to help resolve traffic issues.
Rural stores without immediate access to first responders should keep a first aid kit and defibrillator in these stores and have staff members trained to issue first aid in case a medical emergency occurs on the premises.
Evaluating risks and taking time to customize technologies and policies to the store's greatest needs according to the surrounding environment is no easy task, but one that is well worth the investment.
Establishing a retail security program is difficult and too often once decided on, is implemented across the board and rarely challenged. The greatest problem with these baseline programs is that, in implementing them, retailers are building in failure points. Security concerns are simply not the same in rural, suburban and urban environments. To be effective, the security practitioner may need to start from scratch when building an urban strategy. Every aspect of the operation may be different and mitigation strategies must meet these unique risks. Although difficult, it is worth the effort to factor in the impact location has on the store and design a program that may look completely different than the baseline program. You may find that a more customized program can be a game-changer for your shrink prevention and people protection strategy.
About the Author: Eric White is director of retail strategy for Wren, providers of physical security solutions. White can be reached at firstname.lastname@example.org. To learn more, visit www.wrensolutions.com.
White previously served in loss prevention (LP) and security roles at Wal-Mart and The Home Depot, and has over 20 years of experience in loss prevention, asset protection and physical security. He is the chief blogger for the LPXtra blog from Wren.