The state of the loss prevention industry: 2012 update

Both apprehensions and recovery dollars from shoplifters, dishonest employees rose in 2011


• Have employees walk the sales floor: Keep visible, and keep displays neat and organized (so missing items can be more easily noticed).

• Have good sight lines on the sales floor: Do not block the view of high-value and highly popular items, and keep these items near employee work areas.

• Limit items on sales floor: Limit the number of certain items (high-value, highly pilferable) placed on the sales floor. This will reduce vulnerability to large losses of these items and make it easier to identify missing items.

• Use technology: Such as EAS (electronic article surveillance), merchandise alarms, CCTV, ink/dye tags, product tie-downs, and bulky packaging. Also ensure policies/procedures regarding technology are adhered to.

• Know your merchandise: Especially highly popular items, high value items, what's stolen most often and what’s easily stolen. Study why items are taken, evaluate their locations and packaging – then make changes.

Internal Theft:

• Effective pre-employment screening process: The first step to controlling employee theft starts at the point-of-hire; do not hire the "bad apple." A thorough pre-employment screening process including, reference checks, "honesty testing," SSN trace/verification, criminal background checks, and drug testing is most important. Money spent up-front in the screening process to identify 'quality' employees will result in savings from reduced turnover and losses.

• POS exception monitoring: Use a POS exception based monitoring program to quickly identify possible fraudulent transactions at the point of sale (ie. excessive refunds or voids; refunds or voids before or after store hours; .etc.).

• Auditing for compliance: Ensure consistent compliance to company policies and procedures by conducting loss prevention/shrink audits on a regular basis. By reducing the opportunity, you reduce the chance of theft/loss.

• Training and awareness: Invest in loss prevention training and awareness programs for all employees, and a reward program for employees who report dishonest activities.

• "Back to Basics": Ensure "LP basics” are in place and adhered to at all times:

- Door controls (OH doors locked and exit doors alarmed)
- Trash controls (Monitored, supervised and dumpster locked)
- Package/bag checks (conduct whenever an employee exits the location)
- POS controls (two people witness and verify refunds and voids)

About The Author: Mark R. Doyle, is President of Jack L. Hayes International, Inc., and has over 25 years experience in the loss prevention field. He has consulted with some of the finest retail, wholesale and manufacturing companies in the world. Hayes International, Inc. has been in the Loss Prevention/Shrinkage Control consulting business for over 30 years, and is recognized on an international level as the foremost loss prevention and inventory shrinkage control consulting firm in the world.