Now is a tough time for retailers. Not only are they battling a slow economic recovery, but they are also facing increased losses from theft. The recent 2009 Global Retail Theft Barometer of 41 countries, including the United States, showed that shrinkage — losses from shoplifting, employee theft and other sources — rose by 5.9 percent, the biggest increase since the survey began in 2001.
In the United States, the main problem was employee theft, which accounted for 44.3 percent of shrinkage, or $18.7 billion. Shoplifting cost U.S. retailers $15.1 billion, making up 35.7 percent of the loss. The remainder came from internal error and administrative failure (such as pricing or accounting mistakes) and supplier or vendor theft.
Many consumers pay little attention to these numbers, not understanding that retailers pass along these losses in the form of higher prices. The survey estimates that retail theft costs the average family more than $208 per year.
So what can retailers do to help control this problem? The first thing many people think of when retail security is mentioned are the tags attached to numerous items in stores. Unless removed or deactivated at the cash register, these tags create an alarm as they pass through pedestals at store exits. This technology may not be appropriate for smaller retailers or many other specialty stores; however, there are still tools available for any retailer. Here is a review of some of the technologies that have proven to be most effective in a retail setting.
Cameras are one of the most popular security tools in use by retailers. Over the past few years, cameras have become smaller and easier to install, while providing more capabilities and features. Today’s IP cameras are easily scalable and added or moved on a network system. This makes expanding a system simple and enables retailers to move cameras to other locations as needs change. Upgrading an IP-based camera is often as simple as using the network to download new software directly to the camera.
The resolution of current cameras on the market is also rapidly improving. That is especially true of megapixel cameras. Added pixels make it possible to capture valuable information such as facial detail and license plates.
Many retailers also mount a monitor showing live video at main entries to immediately let shoppers know that they will be under surveillance while in the store. This can serve as an effective deterrent to many would-be shoplifters.
Proper camera placement takes on added importance in a retail setting. It is critical to have a sufficient number of cameras, correctly positioned, to capture images from cash registers, high-value merchandise displays, entrances and loading docks. Mall operators need cameras positioned to monitor escalators and elevators, walkways, food courts and parking lots. It is best to work with a systems integrator experienced in retail operations. He or she will help with camera selection and placement.
Also, many cities across the country are considering or have enacted laws that require convenience stores, bars and other high-traffic public businesses to install camera systems to help control crime. In 2008, for example, Dallas, the nation’s ninth largest city, began requiring its 950 convenience stores to install high-resolution camera systems.
For chain stores or operators of multiple malls or shopping centers, it may make sense to monitor cameras from a central location that can be staffed with experienced loss prevention specialists. By transmitting video over secure Internet connections, corporate security staff can help monitor many locations at once. This type of monitoring makes sense in that it enables store or mall management personnel do what they do best — work with customers, employees and vendors to help maximize sales and profits. That leaves trained professionals to worry about shoplifting and other security issues. This is a situation where it helps to work with a systems integrator that has nationwide partners to accommodate retailers with a regional or national footprint.
The enhanced resolution of modern digital cameras is largely wasted on a recording system still incorporating analog VCRs. Yet at the same time, DVRs, a huge step up from VCRs, are being passed by the network video recorder, or NVR. NVRs record directly to the network through servers, making it easier and less expensive to store larger amounts of data, which can be accessed for analysis and review throughout the network.
Clear, sharp video that can be easily accessed can also prove very useful if a retailer decides to press charges against a shoplifter or employee for theft. It can also help in litigation, such as slip-and-fall claims, and help settle fender-bender disputes in the parking lot.
Software capable of analyzing video to spot user-defined exceptions can be a tremendous asset for retailers. The software can be programmed to note and alarm when suspicious activity occurs, such as someone exiting through an emergency door, loitering in one place for a long time, or a large number of valuable goods quickly being removed from a store shelf.
Facial recognition systems can be placed at store entries to compare the faces of people entering the store against those of known shoplifters. Once such a person is identified, store security can ask him or her to leave or subject the person to increased levels of surveillance.
Cameras also can be used for more than just security. Once in place, they can help monitor checkout lanes to see if adequate staff is available to meet customers’ needs. That can help in keeping shoppers happier. Cameras can monitor special displays to see how the public reacts to new items or those on sale — providing valuable information regarding customers’ shopping habits. Also, a video system provides verification that store policies and procedures are being followed. For example, the owner of multiple convenience stores can remotely view each site to make sure they are being opened and closed on time each day.
Wireless mesh networks — typically found in large government installations —are now being used to transmit video and other data over large outdoor areas such as shopping malls. These systems allow for the quick and easy addition of updated cameras without the expense of cabling that is required of standard installations. Wireless transmissions also allow for live video feeds to handheld units carried by security guards on patrol and the video can be easily shared with local law enforcement in an emergency situation.
In general, malls and individual stores openly invite as many people as possible into their space. But there are some areas where access needs to be limited. That is where access control systems can play a role. An access system can help managers to protect valuable areas, such as cash rooms, warehouses and security operations centers from the public and employees who have no business being there.
Probably the most commonly used security measure in the retail industry is a monitored burglar alarm. A relatively low-cost system can provide protection whenever the store is closed.
Mirrors mounted in ceilings and on walls can enable store personnel to inconspicuously monitor known high-theft areas. Mirrors are especially valuable in convenience stores, where often a single employee on duty would find it difficult to watch the entire store while monitoring the cash register.
Store detectives posing as ordinary shoppers can patrol the shopping area looking for shoplifters. Uniformed security guards can act as a deterrent to shoplifting, as well as handle other security issues that may arise.
Adequate lighting, especially in areas such as parking lots and loading docks, is important. It is also important to keep landscaping well trimmed to not provide a place for criminals to hide before attacking store customers or employees. Also, smaller stores need to maintain a clear view into the premises from the street or parking lot.
The Big Picture
Retailers have many security problems not shared with other industries. All offer valuable items – ranging from food to jewelry – openly displayed to the public. Larger stores may have thousands of shoppers enter each day. Some retailers are open 24 hours a day. And few industries were as deeply impacted by the recent recession.
Security measures that deter theft by customers and employees are a wise investment. Some retail loss prevention officials estimate that a security system can pay for itself within a year. Those results may vary depending on the type of store, location, number of employees and a number of other factors. Deterrence is generally always less expensive than attempting to catch thieves in the act and prosecuting them later.
But technology solutions, both high- and low-tech, are available to help give retailers the upper hand against criminals. Any edge is especially important as many retailers are battling for their continued business existence. To get the most out of today’s technology, work with a security integrator with knowledge of the industry and years of experience working with retailers.
J. Matthew Ladd is president and chief operating officer of Exton, Pa.-based The Protection Bureau, a leading systems integrator providing electronic security services in the Mid-Atlantic Region. He has over 30 years experience in the security industry in all aspects of the integrator’s side of the business. The Protection Bureau is also a member of Security-Net, an international network of 24 top independently owned security system integrators.