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Tough Times Demand Tighter Retail Security

Written by: Scott Kreisberg

Article Overview: Every retailer has a unique set of security challenges and, in the retail world, your security challenges never end. More retailers are realizing that using perimeter and anti-virus technologies alone are not enough. As someone once said, it's like locking your doors but leaving your windows open. Now retailers must take a lot more security measures. Here are some vital strategies retailers need to take for preventative measures against retail loss...

Tough Times Demand Tighter Retail Security

Every retailer has a unique set of security challenges and, in the retail world, your security challenges never end. More retailers are realizing that using perimeter and anti-virus technologies alone are not enough. As someone once said, it's like locking your doors but leaving your windows open. Now retailers must take a lot more security measures.

Some vital strategies retailers need to take for preventative measures against retail loss include:

• Security for your network
• Security against theft
• Protection of data
• Prevention of administrative errors 

In today's competitive environment, a retailer's shrinkage performance can mean the difference between a good year and one that fails to meet expectations.

Recording what occurs in your store is also very important, whether it be before, during or after an event. Digital video surveillance and POS monitoring can deter common forms of employee theft, register theft and fraud.

Going on for some time now is "sweet-hearting," as it's known to retailers, which is when the cashier lets friends and family walk out with more than they paid for. It is quite common in the retail sector.

To prevent this, security software is necessary which uses a motion analysis algorithm designed to spot each instance when an employee may have bypassed the checkout price scanner with a grocery item, or passed a barcode-side-up over the infrared lens. It then checks with the store's point-of-sale system and cross-references time stamps to confirm the missed scan.

This is from U.S. SBA on cashier surveillance:

"The cashier's post is particularly vulnerable to theft. The experienced cash handler with larceny on his or her mind can rob a store blind in a hundred and one ways.

"Case in Point: A store owner's sales were high, but profits were dragging. The cause was traced to a cashier who rang up only some of the items bought by "customers." In most cases, the cashier didn't ring "put-downs" at all. (A "put-down" is the right amount of cash which a customer leaves on the counter then leaves without waiting for a receipt.)"

• Keep a sharp eye open for signals, nods, winks, and so on between cashiers and customers.
• Pay special attention to cashiers when they are surrounded by clusters of people.
• Be alert to the use of over-ring slips to cover up shortages.
• Watch for items bypassed when ringing up sales.
• Check personal checks to make sure they are not being used to cover up shortages.
• Use a professional shopper to check for violations of cash register and related procedures. 

From camera surveillance systems, people-counting devices to point-of-sale terminals and video surveillance systems, you can easily collect store data and transmit it over the store's IT network so that it can be analyzed and delivered in graphical, easy-to-read exception reports.

Today security solutions go beyond just loss prevention and can provide the tools for improved operational efficiencies. Video surveillance, remote viewing, video analytics, intrusion and fire monitoring, to more robust solutions encompassing point-of-sale data mining and integrated technologies embrace the operational measures a retailer should take.

Protecting information

Keeping data safe is another big challenge retailers face. It is vital for a retailer to upgrade their security practices to prevent big data breaches. Hackers create havoc, like they did on the Heartland Payment Systems' credit card processing system reported in January this year.

Achieving robust security, reliability and efficiency for today's networks calls for a unified approach that protects from all threats, regardless of where they originate, within both the network and application layer.

Prevent malicious attacks, firewall-evasive applications, and online information break through protection provided by outdated inspection firewalls. Securing your networks today demands a new approach, solutions that integrate without compromising performance.

Preventing retail theft

As a retailer, you know the effect shoplifting has on your inventory and profitability. Entire retail chains have gone out of business due to their inability to control losses from theft.

In today's retail technology, security is the main concern. Reducing shrinkage is a profit growth strategy for retailers. It requires utmost attention and care beyond retail discounts and promotional tactics.

The good news is that the National Retail Security Survey (NRSS) preliminary results showed the lowest rate of loss in the 17-year history of the survey and a continued six-year downward trend. One likely reason for the decrease in retail theft is the long-term investment by retailers in anti-shoplifting and anti-theft technologies and training.

The study shows there is good evidence that anti-theft technologies, properly implemented, are having a positive effect on reducing crime in the retail environment.

To start, you'll need to remove the temptation to steal. There is no substitute for well-implemented preventive measures.

Wal-Mart, for example, discovered that having greeters, those friendly employees who meet you at the entrance, reduced shoplifting by as much as 35%. So not only is greeting and making eye contact with people who come in good business, it also deters shoplifting.

Here are other ways to deter shoplifting:

• Design your store to reduce shoplifting. The easiest way for retailers to discourage theft in a store is by taking away opportunities to steal. A well-designed store layout will not eliminate all shoplifting but will help reduce it.
• Place easy-to-shoplift items close to checkout counter. Make your presence known throughout the store. Walk around the store periodically and greet customers in a friendly manner.
• Control pricing procedures. Price items by machine or rubber stamp not by handwriting. Permit only authorized employees to set prices and mark merchandise
• Implement refund and returns policy to deter dishonest employees from marking down cost. Match items to the return vouchers and then return the merchandise to stock as quickly as possible.
• Apply anti-theft tags to consumer goods at the point of manufacture, or source tagging, which is gaining further popularity as a loss-prevention method.
• CCTV (Closed Circuit TV) filming all areas of the store is the most successful way to prevent shoplifting. Installation of physical obstacles such as alarm at the store exits, and closing the back exit of the shop would also prove beneficial. 

Other tips from U.S. SBA on shoplifting:

• Keep tight checks and controls on washrooms and fitting room.
• Keep unused checkout aisles closed. Schedule working hours to assure adequate personnel coverage during peak periods.
• Keep doors that are used infrequently locked.
• Post anti-shoplifting signs.
• Display small inexpensive items behind the checkout counters.
• Keep small expensive items in locked display cabinets.
• Use plainclothes patrols in larger stores.
• Make sure employees know what to do when they spot a shoplifter.
• Turn over apprehended shoplifters to the police.
• During busy periods, station a uniformed guard at your exit.

Preventing employee theft

The biggest threat facing store owners is employee theft, which accounts for nearly half of inventory shrinkage--more than shoplifters, more than administrative error and more than vendor fraud.

Internal shrinkage is caused by the actions of the employees of the store, such as pilfering merchandise, cash, provisions etc. According to a study, employee theft and embezzlement of accounts cause almost half of the total retail shrinkage. Cashier-caused shrinkage occurs in ways of wrong recording of transactions, forging receipts, misuse of the register or computer etc.

CCTV monitoring, good store surveillance and maintaining good relations with employees will help to restrict this.

Tips from U.S. SBA on preventing employee theft:

"The best profit safeguard you can have in a store is the employee whose integrity is beyond question. The trouble is that too many retailers take integrity for granted. "Innocent until proven guilty" is a meaningful and deep-rooted American principle. But it doesn't preclude the need to install effective theft deterrents and to track down dishonesty.

"Case after case points to this need. All too often, the biggest crook turns out to be the most trusted employee, the hard worker who has been with the company "umpteen" years, the one about whom you are most likely to exclaim, "Not Charley! Anyone but Charley!"

"The problem is that Charley, with his long experience, knows store procedures backwards. Because Charley is so knowledgeable and well trusted, he is in a better position to steal than anyone else. And all it takes to get started is one weak moment, one time of need, one dishonest friend, or one temptation that is too hard to resist.

"An example is a trusted store manager who was on the payroll for years and had often been a guest in the owner's home. Undercover investigation to determine the reason for inventory shortages revealed the following: The store manager had altered reports to indicate that the store received more goods than were actually delivered. He was in collusion with a vendor who split the extra payments with him. He also stole merchandise and carried it away from the store in his automobile on Sundays.

"The store with the greatest proportion of honest employees suffers the least from theft loss. The trick is to take every precaution to ensure that the people you hire are honest to begin with. Then, take pains to maintain the kind of store climate that will encourage them to stay honest.

"Upgrading the level of retail personnel is largely a matter of careful personnel screening and selection, including careful reference checks, credit checks, psychological tests, polygraph lie-detector tests, and personal character examinations. Doing these things and sticking to the basic tenets of employee motivation can help you to generate a store atmosphere that discourages employee theft.

"In addition, owner-managers should use a continuing program of investigation and training. They should train employees on ways to eliminate stock shortage and shrinkage. One small retailer, for example, trains employees to record items, such as floor cleaner, which they take out of stock for use in the store: "Otherwise, it's an inventory loss even though it's a legitimate store expense." Above all, never stop letting your people know that you are always aware and that you always care."

Retail Security Products

Some time ago I wrote an article, "Video Security Systems" that talked about reducing theft using video security technology. It's been around a long time and is even more sophisticated since I wrote the article. It has grown in intelligence and features.

Now retail security products are inclusive of a number of things that amount to the whole scenario of a safe and secure ambience.

Loss prevention software allows retailers to analyze transactions and data, giving them a real picture of what is happening in their overall operations at the store level and even at the employee or sales associate level.

It is better for a retail store to buy the whole retail security equipment from one source because tinkering with them from different providers may end up in an utter mess.

 

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Article Tags: administrative errors, analysis algorithm, competitive environment, cross references, digital video surveillance, employee theft, infrared lens, larceny, li li, motion analysis, point of sale system, preventative measures, price scanner, retail loss, retail sector, retail world, s sales, security challenges, security measures, time stamps



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