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Criminal versus Control

Posted on 4/8/15 1:37 PM

In a market where brand recognition, market share and high competition have most businesses working overtime to reduce cost, there is little room for the losses caused by internal theft. Industry reports suggest that as much as 43% of all losses are caused by dishonest employees, totaling $16 billion annually in revenue loss.

Obviously with so much at stake, an honest employee is a key element to business health - but is there a magic bullet? How can we tell if an employee is likely to engage in dishonest behavior?

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Topics: loss prevention, Audits and Investigations, Calculating Shrink

The EBR Balancing Act

Posted on 3/25/15 11:18 AM

For more than two decades, exception-based reporting (EBR) tools have been widely used by retailers to analyze point of sale (POS) and other business related data. Even though these tools have saved considerable time and resources in the analysis, detection and resolution of concerns, the use of these tools still requires time and resources. So, how does one determine the necessary number of analysts to properly analyze their exception-based reporting information?

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Topics: loss prevention, EBR, Exception Based Reporting

How Are You Calculating Your Stores Shrink?

Posted on 3/10/15 9:45 AM

“Shrink” is a common term in the retail world. It is a term for the calculations that demonstrate the loss of merchandise in relation to our total inventory sales. We say “calculations,” plural, because there is some flexibility in how it is calculated and the exact nature of the relationship between those items lost and those items sold. Most loss prevention professionals prefer to discuss shrink in terms of loss as a percentage of retail sales, while many finance professionals like speaking in terms of true “cost.” In truth, as long as the reporting method remains consistent from year to year, the three accepted methods of Shrink calculations are all created equal. 

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Topics: loss prevention, Calculating Shrink, LP 101, Shrink

Is Your Loss Prevention Program Like A Spork?

Posted on 3/5/15 9:11 AM

You may not immediately recognize the word “spork.”  Perhaps you know it as a “foon.” It’s that inventive little utensil made famous by fast-food take out and camping trips. The spork is a combination of a spoon and a fork. An efficient and cost-saving invention that has been around since at least the eighteen hundreds (I won’t go into all the things I know about the Spork’s history at the risk of sounding like a geek).

Now this little tool is great in a pinch (or on the road or in the woods) but I’m going to go out on a ledge and make a guess. I’d guess if I open the utensil drawer in your kitchen that I would find lots of silverware. No doubt, two sizes of spoons, two types of knives and prob

ably two sizes of forks. I’d probably see that you could last a week in full supply without ever washing a utensil. And I’d bet that beyond the basics, you have a whole bunch of other interesting, though seldom used “specialty” utensils. An entire drawer of stuff devoted to doing one thing – eating. I’ll go a little farther out on that ledge and bet that in all that stuff, maybe…and that’s a big maybe…you have one “spork” still wrapped in plastic. That lone little guy is probably not with the silverware, but in that “other” drawer - The one where you keep all those condiment leftovers and take-out menus from your last fast food run.

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Topics: loss prevention program, loss prevention, employee awareness

Attend What You Intend

Posted on 2/25/15 9:00 AM

 

They say the road to Hades is paved with good intentions. If that is true, than I say most of the heavy road construction was completed by the “new year special committees.” Those business groups we form in January and February charged with special tasks such as POS rollout, Training Initiatives, or Shrink. The intentions are, of course, in the right place. Certainly, in at least the first couple of meetings goals are met…and then comes Spring…and Summer…and attendance and attention wane.

Now granted, I’m not a huge fan of committees. In my opinion committees are as the British politician, Sir Barnett Cocks said: “a cul-de-sac down which ideas are lured and then quietly strangled.” My distrust for such groups is not born out of dislike for being a team player. Team’s are critical to achievement—small teams. Small teams with a specific set of goals, that follow specific plans, and include specific and individual responsibilities—I call it managed creativity. My reason for a small team preference is that while evolution may make great leaps to achieve change, human goals are reached through small and incremental steps. The more people there are milling around, the more likely we are to lose focus and misstep. But this isn’t an article on the pros and cons of committees. It is about “attending to what you intend.” A premise that is  much simpler in theory than in practice. 

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Topics: loss prevention, lp development, educate, career development, associates, Consulting

Baggage Claim

Posted on 2/17/15 10:00 AM

As humans, we were born selfish. Our instinctual need to be the most important part of our own universe runs through all our veins, and rightfully so. Without “me” being the top priority in everything we do every single day, we would never survive. So, it should come as no surprise that our own life issues are carried with us at the top of our minds, everywhere we go- including work.

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Topics: employee theft, loss prevention, employee awareness, educate, Holiday Tips, customer service

Is Your Company Headed for the Emergency Room?

Posted on 2/11/15 11:37 AM

It’s an interesting conundrum that although no one can guarantee great shrink results, bad shrink is easy to predict. It’s a case of we “don’t know what we don’t know.” In other words, one can never really be completely sure if an employee may have stolen, if unreported shoplifting is crushing our profits, or if people are confidently doing important things the wrong way. The reverse however is not true. The absence of important and critical behaviors is easy to detect. And in their absence, one can surmise that our shrink results will be a train wreck or that any positive results are going to be, at best, really fortunate luck.

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Topics: loss prevention development, preventing theft, loss prevention, Retail

Loss Prevention’s Big “I Wish We Had” Moments

Posted on 2/3/15 10:28 AM

We can spend a lot of time discussing audits, shrink numbers and awareness programs, but there is nothing more frustrating than the unresolved theft issue. I’m not speaking of the “mystery” stuff where there is uncertainty as to the cause of the loss. Nope, I’m referring to the missing money or merchandise that by virtue of access and opportunity had to be an employee. Things like the dreaded missing deposit or empty back stock containers that used to contain our merchandise.

Their is something psychologically draining about “knowing” you have a dishonest employee problem, knowing they took “stuff” and knowing there is no way you can prove it.  Sure you can interview the entire store, sure you can blame it on the employee who quit, and sure you can resolve to never let it happen again, but still you’ll taste bitter dissatisfaction. The interesting aspect of unresolved dishonesty is that it is usually accompanied by a big “I Wish We Had” moment. A mental…maybe verbal…rundown of the things we wish had been in place before the theft. That little bit of now elusive evidence that would have drawn a comfortable trail to the responsible party.

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Topics: loss prevention development, preventing theft, employee theft, loss prevention, Refund Fraud

Profits: Lost in the Surge

Posted on 1/13/15 12:49 PM

 

There is an old saying, “It’s not over til it’s over.” The holiday sales surge is a good time to keep that tenet in mind. 

If you are a sports fan, you may recall a celebratory disaster that involved Leon Lett a Dallas Cowboy’s defensive lineman. Mr Lett had the good fortune and skill to recover a fumble by the Buffalo Bills during the fourth quarter of Super Bowl XXVII. Ball in hand he took off for the end zone, another touchdown for the Dallas Cowboys almost guaranteed.

At about the ten yard line, however, Mr. Lett began his premature celebration, the football held out in one hand as he prepared his theatrical victory dance in the end zone. To his shock, dismay, and embarrassment, Buffalo Bill’s player, Don Beebe had chased him down and Beebe stripped the ball from Lett’s outstretched hand before he crossed the goal line. Celebration Canceled.

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Topics: loss prevention, policies and procedures, educate, Holiday Tips, customer service, Gift Card Fraud, Refund Fraud

Gearing Up For Success in the New Year

Posted on 1/6/15 11:36 AM

January inspires most professionals to make new plans and set new goals. There is an almost magic influx of motivation when we cross that arbitrary line of delineation between the old and the new year.  At LPI, we’re no different and we are busy planning and executing on all of the great possibilities that a new year and a fresh start can offer.

But like many industries, loss prevention is a game of numbers.

The most important numbers are those that indicate the success of our loss prevention programs. Numbers like shrink decrease, margin increase, apprehensions, admissions, and audit scores, all serve to either tell the tale of our success or to indicate places for improvement. 

Of course, as the saying goes, you miss 100% of the shots you don’t take which means if you aren’t implementing specific objectives and setting specific goals, you won’t have any measurement to gauge your 2015 success. 

And goal setting is only half of the equation. Knowing your target is good, but having a plan to get there is of equal importance. So to help you re-establish your 2015 business plans and objectives, LPI is offering you this helpful 8 Step Annual LP Planner outline to ensure all the loss prevention basic best-practices are included in your plans. 

Authored by: Ray Esposito

   

  

 

 

 

 

 

 

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Topics: budget & ROI, loss prevention, employee awareness, educate