In 2018, it was reported that U.S. retailers posted an annual loss of $35 billion dollars. Two years later the results will be worse.
Today’s post is from our archives at SafeSourcing, Inc.
What will 2020 results tell us after a very challenging year? These practices are still very important regardless of retails evolving model.
In 2018, it was reported that U.S. retailers posted an annual loss of $35 billion dollars due to theft and errors. This includes internal theft, shoplifting and also errors such as inventory not being accounted for correctly. According to hubsopt.net there are 6 principles you should follow to minimize theft in your company.
- Prevention: Taking the necessary steps to prevent theft from happening. Dedicating resources, whether internally resourced, co-sourced or outsourced, brings the skill, knowledge and attention to the concepts of loss prevention and the continued progression of a loss prevention function. The creation of policies, procedures and processes geared toward the holistic approach to loss prevention provides the greatest long-term opportunities to prevent loss and increase company profitability.
- Awareness: Make sure you and your team are aware of how to prevent theft and steps to take to be more diligent. The key to awareness is to make certain that it focuses on all levels of associates; field management, store management and all associates. It must also be viewed as part of the overall business and not seen as something separate or only utilized by store personnel.
- Compliance: Maintaining compliance within retail locations is always best served through auditing the various operating procedures and policies. You need to make sure you hold people accountable and everyone is doing exactly what they need to. Having random audits keep everyone in line and hopefully less mistakes.
- Detection: The use of technology, coupled with generating awareness about the technology, a retailer can create a level of deterrence against future thefts. Technology alone, however, is not a complete solution. Make sure once something is detected you take very quick action to fix it. The longer you wait the chances of bouncing back from the loss is minimal.
- Investigation: Involving the collection of evidence, interviewing of associates, or the overall process to find someone involved in theft. Although the term investigation is often used in this sense, it is not entirely accurate. An auditor conducting an operational audit is in fact conducting an investigation to determine compliance or adherence to policies and procedures.
- Resolution: The reactive aspect of a loss prevention program starts to become proactive once again. Establishing a process for resolution will help to answer the questions of how to prevent future losses. After a solution has been determined it is very important to see it through and make sure things get fixed for future problems.
Per hubspot.com, reviewing the six principles of Loss Prevention, it has become evident how each of them plays great importance in building and maintaining a solid loss prevention program. As individual principles, they each provide elements toward reducing shrinkage, margin loss and costs. Collectively working in tandem, they provide the key principles of a loss prevention program and a solid foundation against loss.
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