Deeper Analysis May Reveal Necessary Shifts in Target Programs
As the end of most retailers' fiscal year approaches, physical inventories will soon be scheduled, and year-end (or half year) inventory results calculated. Once completed, retailers will look to evaluate their results to determine how profitable both individual retail locations and their company as a whole were against inventory losses.
The de facto standard that most often determines a store's profitability against loss is the calculated percentage of dollars lost against sales dollars, or the shrink percentage. Most commonly, the shrink percentage is the singular measurement of performance of a location, as well as the only criterion used when judging whether a store should be part of a target store program.Read More
Topics: shrink awareness
Mark Twain wrote, “I was gratified to be able to answer promptly. I said I don't know.” It’s an interesting proposition and amusing when we consider the answers we must provide when shrink, loss, or performance misses the intended goal. In general poor loss prevention performance has only three sources—systemic error, shoplifting, or employee theft. Thankfully it is only three because even at that, it can be quite difficult to narrow it down to just the one. The issue isn’t that discovery of the main cause is impossible, the issue is we often rely more on “crystal ball” techniques than evidence based analysis.
One of the easiest and most direct channels for communicating the desired behavior is through a clear and concise awareness program. We can think of such programs as "education," in part because that is the main purpose, but in truth, this is our best shot at an advertising campaign.
The Ninth Annual Report from The Retail Equation uncovers staggering numbers regarding 2013 merchandise returns in comparison to last years loss prevention awareness trends.
There is an old proverb that states, “he who thinks he leads but has no followers is only taking a walk.” For all of the books, articles, and seminars on the topic of leadership, one would believe that it requires some form of magic or unique charisma. The truth is that following others is a natural human characteristic. The problem is that the inherent programming to “follow” doesn’t include an equally inherent set of standards on “who” to follow.
Psychologists have devoted a great number of hours to understanding the human follow response. What is clear is that there is a natural tendency to use the behavior of others as a short-cut to decision making. Some of these experiments are as simple as having one person stand on the street and stare at the sky-in which the vast majority of passerby’s will mimic the behavior. In more advance studies, a person sits in a room that fills with smoke. When paired with “confederates” who don’t react, the majority of participants remain in the room until the environment becomes unbearable. Other experiments have people on the street following another person through an elaborate layout of roped stations, although none of them have any idea why they are following or what is to be the final destination.