From the issue: Anti-theft secrets

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From the issue: Anti-theft secrets

By Steph Koyfman - 02/20/2018

Shrink is a perennial topic for retailers, even as the rise of sophisticated anti-theft technology continues to aid businesses in their apprehension efforts. Some might argue that theft will continue to antagonize retailers so long as humans have vices. Others might posit that it’ll remain a problem so long as store owners continue making the same management mistakes.

One gets the sense that Joe Szvetitz, managing partner at Risk Management Services Loss Prevention, falls into the latter category. If he didn’t, he might not have spent his career helping retailers minimize their losses via proprietary monitoring technology, risk assessments, training and investigative services. Unsurprisingly, Szvetitz said, a lot of retailers tend to make the same oversights, and it’s costing them. Here are a few:

1. It begins with the hire. A good hire begins with a background check. Even if previous employers can’t do much more than confirm a candidate’s work history, a tight-lipped reply could point to trouble. “Do your due diligence,” said Szvetitz. “It doesn’t have to cost anything to do that.”

2. Keep an eye on your return policy. Fraudulent returns and refunds are the easiest way for employees to commit theft. That means even if you set a $25 limit for cash returns, dishonest employees can steal up to $24 at a time. Set clear-cut policies regarding employee purchase, return and refund procedures so that no one can plead ignorance.

3. Money belongs in one of two places: a cash drawer or a secure safe. “Never collate business and personal funds,” he said. “Many times, we’ll see employees go in their own pockets to give change to a customer. Any time you comingle those funds, it opens the door to someone taking advantage of cash policies.”

4. Follow the law of twos. Never let anyone open or close a store alone, and always have a second person involved in any type of return. This limits temptation, and improves safety.

5. “Inspect what you expect.” A lot of retailers don’t follow up on their procedures, Szvetitz said. That means having a process to verify that your employees are doing what’s expected of them. It also means following up on voids and returns, using your camera and POS systems, and double-checking that the information they generate is accurate.

6. Keep your passwords fresh. Retailers are often surprised to learn that store associates have managers’ codes. Sometimes, former employees still know the computer passwords, or even have working keys to the store. Smart retailers change these regularly.

7. Hold your employees accountable. “Smaller businesses fall into that comfort zone of ‘no one would take from me, everyone likes me,’ ” Szvetitz said. “If you own a business, it’s your livelihood. Everyone else who works for your company, it’s just a job. They can all go out and find another one. But if you’re the one who signs the paychecks, you’re responsible.”

8. Make daily deposits. When retailers let cash and paperwork build up, they expose their business to risk in the event of a fire or burglary. It’s tempting to let deposits and receipts sit over the weekends, but it’s best to get money to the bank every day, even if you have to use the night deposit box.

9. Give pop quizzes. “Leave early or your normal time one night, and then come back 45 minutes later unannounced and see what’s going on in your business,” Szvetitz suggested. “One of the best things people should do is do unannounced cash counts.”

10. Compare and contrast. You can use a sales graph to see whether there are major discrepancies between various employees’ shifts. Of course, it’s not always an indication that someone is stealing — they may lack the proper training or customer service skills.

For more information on investigating loss and reducing shrink, contact Risk Management Services Loss Prevention.

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