[Editor's Note: We're proud to announce that Liz Martinez will authoring a column for SecurityInfoWatch every month dealing with issues of retail security and loss prevention. Look for her in Security FrontLine eNewsletter and on the Retail Security section of SIW.]
The day after Thanksgiving traditionally opens the portals to holiday shopping. As stores are flooded with eager bargain-seekers this November 26, wise retailers will do well to remember that shoplifters also swell the post-Turkey Day crowds.
Every day is a good day for shoplifting, but thieves know that they can take advantage of the chaos that occurs on the unofficial opening of the holiday shopping season to hide in the crowds. They slither among legitimate shoppers right up until Dec. 24, doing their Christmas stealing.
Stores inadvertently make it easier for both internal thefts and shoplifting to occur during the holiday rush. The swelling of shoppers demands the hiring of seasonal workers. The presence of these temporary employees contributes to both internal and external thefts. In addition, full-time staff are stretched thinner during the holiday shopping season. Their attention is diverted in many more directions, leaving quarterback-sized openings that thieves can use to their advantage.
An Ounce of Prevention
To keep shrink down during the next month, retailers must make reducing thefts as much -- if not more -- of a priority as making sales. Store managers or loss prevention executives who are tempted to focus more on sales than theft, or on apprehension over prevention, would do well to remember the Rule of 33. The Rule of 33 states that if an item that retails for $100 is stolen, the store will need to sell 33 more of them in order to recoup the loss. Only with the sale of the 34th item will the store begin turning a profit.
(The number of items that must be sold, 33, is based on the store's net profit of $3 for the item, after subtracting wholesale cost, fixed store expenses -- such as taxes and rent -- as well as unexpected expenses, as apportioned to each item. So even if the mark-up for a particular item is higher, and the store has to sell only 23 or 13 more items in order to recoup the loss, prevention starts to look like a pretty attractive idea.)
Temporary Workers: Are They Really Good for Business?
No busy store can handle the holiday rush without additional employees. These seasonal workers keep the cash registers ringing in the holiday cheer, but many of them are also playing Santa Claus to themselves, and leaving with sacks full of unpaid for goodies when they clock out.
Seasonal workers are often part-time, not entitled to benefits (except store discounts, and what could be more attractive than the five-finger kind?), and low on loyalty to a business that will cut them loose right after Santa slides down their chimneys. In addition, the relatively short amount of time they spend in the store, compared to full-time employees, means that they are less experienced and receive less training in spotting shoplifters and thwarting shrinkage.
Add to these facts the statistic that employees overall are the cause of between 45 percent and 60 percent of store losses. Plus, temporary employees have less to lose than permanent workers. Seasonal employees therefore contribute to both internal and external shrink, both by stealing themselves or in cahoots with other employees or outside conspirators, as well as by failing to notice or take the appropriate actions to deter thefts from shoplifters.
Although permanent employees would seem to be better trained and more loyal to the store, many times that isn't the case. Store policies often don't allow for permanent employees to receive benefits or high hourly salaries, and these workers may sometimes be tempted to "make up the difference" between the amount they receive in their paychecks and the amount they feel they deserve by shoplifting or pulling other scams that shortchange the store. And many stores overlook the power of the floor employees to thwart theft, Management sometimes fails to provide them with the minimal amount of training they need to help reduce shrink.