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How to reduce losses caused by theft at POS

Bob Violino | March 27, 2015
Retail theft is a huge and costly problem for the industry. According to the "Global Retail Theft Barometer 2013-2014," released by Checkpoint Systems in October 2014, total shrinkage among retailers in North America was $42 billion for the time period covered by the report.

Tracking the variances of these type of irregularities can be an indicator that something might be amiss at the POS and can be followed up with an internal inquiry by management or the loss prevention team, Moraca says.

Train your employees well. The people who work in stores can do a lot to help prevent theft.

"A successful program to reduce shrink at POS leverages both technology and training," says Lisa LaBruno, senior vice president for retail operations at the Retail Industry Leaders Association (RILA), an industry organization.

Among the key components of associate training is making every employee feel like he or she has a responsibility to prevent shrink from occurring," LaBruno says. "Associates are trained to be vigilant, check inside large containers to prevent package stuffing and to exercise good customer service when they suspect theft."

In addition, employees should be encouraged to develop strong product knowledge. "If associates have a strong familiarity with the product they sell and the prices, they are more likely to be able to identify things like UPC [universal product code] switching schemes," LaBruno says.

For some retailers, "many of the loss prevention procedures enacted at the point-of-sale are a result of a more stringent loss prevention program that starts with the hiring process as companies look for qualified candidates for all available positions," Moraca says.

"This also includes offering employee orientation and training opportunities for new hires and even current employees," Moraca says. "For many companies, reminding all employees to keep their eyes open to detect and report potential breakdowns in procedures is a big part of any loss prevention program."

Interact more with customers. In a sort of reverse social engineering tactic, retailers can help stop theft by engaging more with clients while they're in the store.

"The most effective deterrent to a potential shoplifter is good customer service, Baillie says. "Making eye contact and acknowledging customers as they enter the store. The last thing a shoplifter wants is interaction with a store employee."

The shoplifter's goal is to enter and exit the store with unpaid for merchandise, without being noticed, Baillie says, and this type of engagement can help work against that.

Consider diversionary tactics. A company called Corrective Education Company (CEC) offers a program to first-time offenders who've been apprehended for shoplifting.

The way the program works, once an offender is apprehended, he is given the opportunity to hear about CEC and the merchant's voluntary education program. The individual's personal information is gathered and verified through public records databases to determine qualification for the program based on retailer protocol, local law enforcement and the local prosecutor.

After agreeing to learn about the program, the offender is shown a four-minute video about CEC's, and can stop the process at any time and not participate. At the conclusion of the video the offender is given the opportunity to participate in a six-hour program, at his own expense, in lieu of having the case referred to the criminal justice system.

 

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