Loss Prevention Spending – What’s Your Goal?

A South African newspaper recently featured an article about a woman caught on video stealing a variety of products. (http://www.bit.ly/AmTheft_i1).  When the shoplifter is caught, this recording should provide effective evidence toward conviction.But as a shop owner, you have to think about your loss prevention objective. Would you prefer to deter theft or to prosecute shoplifters? 

Like all costs, anti-theft programs and equipment require an understanding of what you can expect from your dollars spent.

In the case of Security Cameras (CCTV) systems, you can expect some degree of deterrence. But unless you’re a large retailer and spending the money to have someone watch monitors all day long, its deterrence impact is limited. Video recordings are particularly effective, however, in the area of prosecution (…if you use quality cameras and quality recordings. When you can’t clearly indentify the criminals, they are of limited value). CCTV is also effective in monitoring and spot-checking employees, particularly at cash registers, or when you may already have some suspicion.

For most retailers theft prevention and deterrence is preferable to prosecution. Preferable both in terms of cost effectiveness and peace of mind.

All loss prevention tools have their place and limitations.  Understand the role of each tool you use. Implement a multi-pronged approach to theft deterrence reflecting your situation.

Electronic Article Surveillance (EAS) systems, when effectively implemented, are another good prevention tool. Small tags attached to merchandise set off electronic alarms at your doors. They’re more effective at deterrence than many other tools, sending potential shoplifters to unprotected stores as well as alerting you to unauthorized products leaving your store.

But you do have to think about the products you’re safeguarding and the best way to protect them. Tags are available to secure just about every type of merchandise.  If you’re implementing a system like this, work with your supplier to make sure that the tags and tools you’re using are effective for your product mix.

Packaging has also been proven to make a difference. Many of us remember the long CD boxes that used to help prevent pocketing of music. Those are no longer in use as manufacturers have cut back on packaging cost and reduced waste packaging. The problem is that cd’s and dvds are now easier to hide and steal. 

Other high theft items — cosmetics, bottled items, electronics, gift products …anything small enough to easily conceal and remove from your store — face the same problem.

In this era of  “Green Merchandising,” protective packaging, such as “Keeper” (or “Safer”) boxes can be effective at theft deterrence. Reusable locking polycarbonates boxes allow the product to fully seen in its original packaging, yet make it difficult to pocket. You’ve probably seen these in use at just about every electronics and office supply store. They’re now being used with increasing acceptance in other areas of retailing. Keepers are now manufactured with a “high end” look in mind.

A recent Loss Prevention Research Council study focused on the impact of Keeper use on health and beauty product theft. Their study showed lower shrink and higher sales in test stores that used Keepers. And there was a positive “return on investment” within just months.

There is no single solution that you can set and forget. In addition to CCTV, EAS and Keepers, there is a wide range of effective products and techniques that can help minimize loss and theft from your store.

Before you spend another cent on loss prevention think about your goal.

Contributed by Alan Herbach, who is President of American Theft Prevention Products, Inc. (www.AmericanTheftPrevention.com) which provides retailers with tools to effectively combat shoplifting. Alan can be reached by email at aherbach@AmTheft.com and can be followed on Twitter under the name AmTheft. You can also visit his professional blog at http://AmTheft.wordpress.com.