This European jewelry story opted for high-resolution imagery to prevent theft and positively identify criminals.
Photo credit: Photo courtesy Plustek
Goodwill industries successfully moved to storage at the edge and megapixel video for successful loss prevention.
Photo credit: Photo courtesy MOBOTIX
The retail vertical market is fickle. It's highly predicated on the state of the economy, which we know has been in the dumps for the past several years. Its losses come mostly from internal theft and quite frankly the market hasn't had the funding necessary to expand their surveillance or other loss prevention solutions.
There are exceptions: big box retailers or lucrative upper-end chain stories. And there is business out there, but it's not just about hardware and slapping in systems. It's about providing real value in the way of services that the customer can use not only for loss prevention, burglary and theft but also those that help them dig down deep in business solutions to target their market more fully, address distribution, warehousing and buying trends and translate into a robust total cost of ownership and value they can sink their teeth into. Managed video, analytics, access control and other services will sell when this market turns around and if integrators can show the market how they bring more than security to the table.
"Retail is a huge opportunity for systems integrators," King Rogers, chief executive officer of KRG Analytics Inc., Edina, Minn., and a co-founder and principal of King Rogers Group LLC, told the audience at the 2011 Milestone Integration Platform Symposium conference in San Antonio earlier this year. "You have to make technological decisions, because they need your help."
Rogers said employee theft is the number one cause of loss in the retail sector. "Solutions providers have the opportunity to drive that retail loss down. The sales cycle in retail is at least two years, so you have to be patient. These users need you to tell them what they need to know. Intelligence is what is going to sell the retail end user. Reducing employee shrink is their pain point and what they need," he said.
Retail 101-do your homework to pass customer muster
Rogers said that if integrators are able to show how retailers currently can get more out of the existing systems, they will be trusted and will come back once they are ready to make the leap. "The bottom line is to build relationships," Rogers continued. "Come up with more creative uses for their existing equipment; they want better use of it before they replace it. As far as what's budgeted or planned for the retail sector in solutions, most are all video related, such as real-time alerts on point of sale (POS) overrides, automated returns processing and such."
According to Rogers, some of the key services/requirements of the vertical market include:
- The ability to find more ways to identify shrink activities,
- The ability to make loss prevention more efficient, and
- The ability to centrally manage the auditing of POS data.
"The more ability you provide to address loss prevention, the more valuable you become," he continued. "Cloud storage is one of the most exciting things to happen to us as an industry. Video surveillance as a service: 24-hour video guard service with voice-down capabilities; construction sites; multi-campus and quick service restaurants hold great opportunity."
He added that the bottom line is harnessing the value of video, with some of the following services:
- Managed video-based business intelligence services,
- Video analytics as a service,
- Hosted, highly secure video storage, and
- Video and business intelligence-based consultative services.
"Right now, retailers are strapped, but they are starting to embrace the value of video, especially if integrators can offer it as a business intelligence tool. It's possible to maximize the value of everything you are bringing to their desks. Integrators also need to speak the language of loss prevention or use a consultant or someone who can teach them. That's critical."
Rogers said that video surveillance as a service is 24/7 real-time detection and resolution service. "There are companies today that offer video surveillance as a service. This service helps reduce guard costs and improves guard coverage because they can do analytics/audits as a service with archived video. Other necessary components include integrating rules-based exceptions on a point of sale and integrating that software with video. When that happens the auditor would be alerted to a transaction that fits within that exception and examines the transaction, what took place before, during and a short period of time after it. That type of audit is used to detect them and address training needs."
He added that while exception reporting has been around for some time, with video it's new and more efficient. "It also provides a visual record of the incident as well as records for potential liability."
Find the right niche for national accounts
Integrators have witnessed the challenges of the marketplace. One perfect example comes from Midstate Security, based in Grandville, Mich., led by David Nemmers, owner and president.
Spartan Stores Inc. is a leader in the food distribution industry which owns and operates 122 supermarkets, pharmacies and fuel stations in Michigan. It came to Midstate Security needing video surveillance but also had to meet Payment Card Industry (PCI) regulations for information security. According to the PCI Security Standards Council, the PCI Data Security Standard (PCI DSS) is designed to provide a working framework for developing a robust payment card data security process-including prevention, detection and appropriate reaction to security incidents. Retailers and others who comply with the PCI DSS can convey to their customers that their sensitive payment card information is secure and confident.
"PCI compliance was critical to this customer and also provides a springboard to other potential customers requiring this solution," said Kevin VandeGuchte, Midstate's director of Business Development.
One of the standard's requirements is to continually monitor the area around servers that process customer credit card data, to identify people who had access to the servers. "To meet the requirement, we needed to store 90 days of video, with fluid motion and clear picture quality for positive identification," VandeGuchte said. Midstate was able to come up with a solution that addressed both the compliance issue and also, the long term loss prevention needs, according to VandeGuchte, and the time was right to move from its existing CCTV system to an IP-based platform that would reduce total cost of ownership and overhead and increase system flexibility and ease of use. "Not only were we able to meet the compliance regulations needs, but we reduced management overhead, freed up time for central security officers to monitor real-time video and also achieved capabilities to improve merchandising and planning," he said.
Staving off false alarms for national retail accounts
Vector Security also developed a value-add to its program with its national retail accounts. The company, based in Pittsburgh, and through its Compliance Manager Jim Simons, Manassas, Va., has been working on a facet to its national accounts program. The company helps national accounts with compliance laws, which they may have a tough time keeping up with. "These actually bleed store profits, one small cut at a time," Simons said, "by imposing stiff fines and penalties of up to $1,000 per occurrence." The Vector Security program is aimed at saving retailers money, reducing or eliminating false alarm penalties, assuring 100 percent compliance and helping their national accounts achieve peace of mind. The company has about 120 national account customers.
The National Compliance Service Program, now in its second year, overall has helped those enrolled in the Vector program reduce false alarms by some 52 percent since its onset.
"More and more municipalities are enacting ordinances that make it illegal to operate an alarm system without a permit," added Simons. "It is generally the customer's responsibility to get the permit, but we offer the program to help our customers with the fundamentals because it's getting more complicated all the time. It is the customer's responsibility to get the permit, but we offer the program to assist with it, especially if they have multiple stores to get the fundamentals in place. Compliance is getting more complicated all the time; new jurisdictions are coming on with new rules and it's hard for national accounts customers to keep up with it all. We act as a bridge between the two; we take these issues off their plate so their loss prevention teams can focus on retail shrink and other areas."
Simons said that one company had amassed over $400,000 in fines, so the program was poised to save just as much and the customer could readily see the value. "There are over 2,500 individual rules and permits for the industry," Simons continued. "If they don't have an alarm permit in place, the penalty is exponential. If they get a false alarm, fine. But if they get a false alarm and they don't have a permit it might be three times that amount."
Vector is also integrating video with point of sale and customer counting, letting retailers assess what times their stores are heavily trafficked or lightly traveled.
Retail customers are plagued by employee and internal theft and need to make better use of their systems and services in place. They are increasingly turning to video surveillance integrated with point of sale and other business intelligence operations. Integrators who provide value-added solutions that are more than security have great opportunity within the vertical.
Electronic article surveillance (EAS) is still a mainstay of retailer's protection and detection. It comes in many form factors. Sensormatic EAS systems (www.sensormatic.com) use one or more pedestals or antennas configured to create a surveillance zone at exits or checkout lanes. Pedestals can provide visible deterrence while concealed systems offer more discreet protection for upscale retail environments. Sensormatic also has AcoustoMagnetic EAS labels that provide greater supply chain efficiencies, increased sales, reduced shrink and greater profitability for both the retailer and the manufacturer. The company's Smart EAS products help integrate their EAS, people-counting, video and point-of-sale into their IT networks.
Another well-known player in the marketplace is Checkpoint Systems Inc., Thorofare, N.J. The company provides shrink management, merchandise visibility and apparel labelilng solutions and recently introduced the CheckCare Real-time Service, offering its EVOLVE and Liberty/3G Electronic Article Surveillance (EAS) customers the convenience of remote support for fast, streamlined service and maintenance.
CheckCare Real-time Service includes a globally applicable combination of modem hardware and an airtime provider to allow both the download and upload of data from an EAS installation, regardless of its location. The installation of a mobile wireless modem in each store location frees the retailer from having to provide any telecommunications equipment or IT connection points - both stumbling blocks to remote service in the past.
"Retailers all over the world install EAS systems to protect their merchandise from theft," noted Etienne Maricq, worldwide vice president, Checkpoint Systems' Global Field Service organization. "It is essential that the systems work efficiently, yet discreetly at all times."
Megapixel Technology Protects Jet Oil Assets
JET Oil has installed megapixel technology at 24 of its unmanned gasoline stations. The IP video surveillance systems achieved considerable success in reducing equipment tampering and in increasing asset protection. JET Oil operates 120 stations throughout Sweden. The integrator for on-going installation is Niscayah and the supplier of IQinVision HD cameras is distribution firm Svensk S„kerhetsvideo AB.
Each JET station is an automatic operation. Three IQeye 702 cameras are strategically located at each JET station to protect on-site assets, provide surveillance to guard against customers tampering with pumping equipment and monitor buildings which house pump technical control equipment. Images are managed by Milestone Systems' open platform IP video recording software.
JET Oil plans to install the system in at least eight more stations over the next few months and is exploring connecting each site to a central remote monitoring center. "We have seen a marked increase in our business with gasoline stations throughout Europe," said Ramon Grado, IQinVision EMEA Managing Director. "Our HD megapixel technology is paying off in terms of return on investment for our end-users in preventing driveaways and in protecting expensive assets. This application for unmanned stations is particularly attractive for gas station companies in Europe and around the world."
FAST FACTS FOR RETAIL
- Estimated 7.5 million cameras in retail facilities
- Estimated 30 million surveillance cameras deployed in U.S., shooting billion hours of footage a week
- 98 percent of all recorded video is stored and ignored
- Despite proliferating use of cameras, U.S. retail industry incurs $40 billion in shrink annually $110 million per day!
- Employee theft continues to dominate as the single largest source of shrink
JEWELER SELECTS VIDEO TO CUT LOSSES
ABC Jewelry store, located in the heart of Nordrhein-Westfalen Germany, bears in its simple store front what every women wants at the most important moment of her life-a sparkling stone-the diamond.
Behind the transparent counters, where silver, gold ornaments, all kinds of rare pearls, diamonds, are set forth by their value, clerks assist customers. However, thefts are still inevitable when the clerks are busy or retrieving pieces.
One theft occurred several years ago at closing time to this 22-year-old jewelry shop when two thieves stole a complete set of precious pearls imported from Fiji. Unfortunately, because of the original CCTV system was not high resolution, the thieves' faces could not be clearly defined. The jewelry store owner decided to take the initiative in confronting the possible future robbery or theft. He began looking for architect and engineering consultants to learn how to deploy a better solution without completely replacing his current CCTV system and also how to improve on existing concerns such as lack of higher pixels of his cameras, high power consumption and scalability.
The security system consultant recommended the Plustek solution, as its own video server is designed for high compatibility with the NVR and has been tested thousands of times to ensure a high degree of stability. More importantly, through its flexible customization with third-party integration, Plustek NDVR integrated the access control system with push alarm and notification to warn the police station and the owner, which allows immediate responses to any abnormal activities in any store.
MEGAPIXEL AND EDGE STORAGE STABILIZES LOSSES
Goodwill Industries International, the nation's leading non-profit workforce organization, is on a very noble mission-inspire hope and self-confidence and help people from all backgrounds and walks of life. Through its workforce development services, donation centers and retail stores, Goodwill eliminates those barriers to opportunity so that people in need can reach their fullest potential.
However, in South Carolina, the local chapter was increasingly running up against a major barrier to opportunity of their own; rampant theft at Goodwill Donation Centers. At the 21 retail stores managed by Goodwill Industries of Lower South Carolina, after-hours thefts at donation centers had begun to take their toll, growing to approximately 30 percent and costing thousands of dollars per year. In addition, safety concerns and lower morale was becoming evident among the 1,700 member district workforce. Goodwill Industries had an analog video surveillance solution in place, but the cameras were very limited in their capabilities and effectiveness. Brad Kyzer, loss prevention specialist for Goodwill Industries of Lower South Carolina, sought out a better security camera solution to put a halt to the current trend that was impacting their service so severely.
"With our analog cameras, images were blurry and details unclear," said Kyzer. "This lack of clarity prevented us from providing prosecutable evidence to local authorities in many cases. We were becoming a haven for these thieves who were essentially getting away with stealing our donations."
Finding the ROI
Jose Noy, owner of security installation firm Comsurv out of Charleston, S.C., was the one to introduce MOBOTIX cameras to Kyzer. Noy had worked with Goodwill stores in the past and was aware of the unique challenges associated with securing retail stores and donation centers of the nation's leading non-profit workforce centers. Rather than pushing a complicated, component-heavy surveillance system, Noy knew that MOBOTIX's decentralized approach to IP network video security was the perfect fit.
"There was no question that Goodwill needed to move beyond analog surveillance," said Noy. "However, we wanted Goodwill to avoid the struggle that many users face in harnessing the full capability of their IP video security systems, namely high-resolution imagery. By implementing a decentralized network camera solution, Goodwill would be able to record, analyze and store megapixel video at a fraction of the bandwidth required from competing high-resolution IP video products. At the end of the day, there was no real question that MOBOTIX was the right solution."
Noy recommended MOBOTIX's M24 Allround camera for exceptional image quality for both indoor and outdoor surveillance applications. The weather-resistant camera allows users to zero in on portions of a scene without losing image quality by provides digital pan/tilt/zoom functionality for a 180-degree panoramic field of view. On-camera compression capabilities along with built-in MicroSD slot allow Goodwill and other users to store high-quality video images directly on the device, perfect to conserve network bandwidth and reduce cost. The camera also provides two-way audio support with a built-in microphone and speaker.
So far some 10 stores have been updated. At each location, one MOBOTIX M24 camera replaced two to three analog devices. In addition, the use of the MxPEG video codec has cut the time required to review video in half and significantly reduced the load on Goodwill's network infrastructure-all factoring in to the cost-effectiveness of the solution.