As we begin this new year of 2020, let’s all make a commitment to keep shrinkage control a daily priority within our stores, warehouses, and distribution centers. While some losses do occur at the time of physical inventory taking (inaccurate counts, misidentifying merchandise, etc.), the greater majority of our losses occur day-to-day throughout the year. From the moment product arrives at your location via the warehouse/DC, direct vendor shipment, company transfer, drop shipment, etc. until it is received by our customers, or returned to the supplier/manufacturer, there are many opportunities for losses to occur.
So, lets start off 2020 the right way by checking to ensure that our location is consistently doing “the LP basics,” day in and day out. We believe this is one of those areas that management sometimes takes for granted as being completed and complied with, since most companies have policies and procedures in place to address these “basic” loss prevention/shrinkage control issues.
Yet, our experiences consistently show that many locations, especially those with high losses, fail to properly implement, maintain, or consistently comply with ‘basic’ loss prevention policies and procedures on a daily basis.
Here are just a few LP “basics” you should be complying with on a daily basis.
From both a security and safety point-of-view, ensure two associates are always present at the opening and closing of the store/location.
This is the area/process where it all begins. If your inbound freight is not received and documented accurately your numbers/inventory will be off from the start. Follow your company’s receiving policy and promptly document and report any shortages, overages or damages you identify.
When shipping or delivering merchandise, it is most important to ensure items leaving your location are accurately picked/pulled, packaged and then accounted-for in the system. Always double check for picking accuracy before finalizing any transfer or delivery.
Being “in a hurry” is not a good reason for an inaccurate count.
Damaged and Defective Product
Product received or found dam-aged/ defective in your location, must be treated the same as good saleable items. Therefore, carefully and accurately check-in and process all damaged/defective product to ensure its correct disposition.
Prior to hiring new associates, en-sure your company’s pre-screening requirements are fully complied with to assist in hiring only honest and “quality” employees.
- New Hires: Ensure all new-hires are familiar with your location’s Loss Prevention/Shrinkage Control Program, and all company policies/procedures relating to merchandise accountability and security are thoroughly reviewed with them.
- Current Associates: Ongoing loss prevention/shrinkage control materials should be regularly provided to, or reviewed with, all employees. This would include newsletters, monthly messages, security briefs, confidential 1-800 reporting lines, etc.
- Back Doors: All back/emergency exit doors should be protected by a functioning local alarm-lock which is “set” at all times thus prohibiting unauthorized use of these doors to walk or pass-out merchandise.
- Overhead Doors: These doors should be closed and padlocked when not in actual use. This will prevent someone from entering the location thru an open OH door, and also prohibit the passing-out of merchandise.
- For Specialty Stores and locations with single employee coverage
- Customer Entrance/Exit Door: This door/entryway should have an audible bell/chime that sounds on both the sales floor and in the stockroom that alerts associates when someone enters or exits the store.
- Stockroom Doors: The stockroom door(s) should always be kept closed, and have a chime/bell affixed to sound when the door is opened.Package/Bags
All associates (including management) should have any package/bag/lunch box they are carrying consistently inspected immediately prior to exiting the location.
Trash contents should be inspected by a manager/2nd person immediately prior to removal to check for intentionally or unintentionally concealed merchandise. In addition, boxes/cartons should always be flattened prior to removal, and clear trash bags used in all trash receptacles.
Critical POS transactions such as refunds, voids, price overrides, etc. should be consistently verified at the time of occurrence by a manager/2nd person. In addition, unannounced sales verifications should take place daily to ensure all merchandise is properly rung into the register.
All customers should be promptly greeted upon entering and then approached and offered assistance. Associates should not be so task oriented that they get tunnel vision and ignore customers walking about the sales floor.
Know what products thieves like to steal the most and display accordingly, by keeping items in open areas with good sight lines and limiting the quantity of these items openly available on the sales floor.
Lock and/or monitor fitting rooms at all times to ensure product going in is counted and accounted-for upon customer exiting. Keep fitting rooms clean at all times, and caulk areas where tags, price tickets, etc. could be concealed inside the fitting room.
Remember, technology (EAS, CCTV, merchandise alarms, Locked showcases, keeper boxes, etc.) must be managed, and polices/procedures regarding this technology adhered to at all times.
Ensure consistent compliance to company policies/procedures by conducting unannounced audits. By reducing the opportunity, you reduce the chance of theft/loss.
These are just some of the “basics” when it comes to practicing good loss prevention on a daily and consistent basis. Remember, daily controls will result in positive year-end profits.
Now go have a great 2020!
This article first appeared in “The Hayes Report Newsletter, Winter 2019” and is reprinted with permission.
Mark R. Doyle, Owner and CEO, Jack L. Hayes International Inc.
Mark is the owner and CEO of Jack L. Hayes International, Inc., a retail loss prevention, shrinkage control, and safety consulting company. He is also the publisher of the quarterly “Hayes Report on Loss Prevention Newsletter.” For more than 30 years he has consulted with some of the finest companies in the world assisting them in the design and implementation of programs to control inventory shrinkage and loss.