Shrink Your Shrinkage This Holiday Season

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With the ‘mega’ shopping days of Black Friday, Cyber Monday and Manic Monday over, shoppers have taken advantage of available deals that can be shipped in time for Christmas.

In the weeks leading up to Christmas, more people will be trooping through your doors to find that perfect gift. More people should equal more revenue, right?

Only if you have a firm grasp on how to shrink your shrinkage.

Shrinkage is the inventory loss caused by crime or administrative error. It is also the number one cause of reduced profits in the retail industry, worldwide. Recent reports show that shrink has risen by over 20%. This has cost the retail industry up to £5.03bn in losses. While the largest proportion of this is by shoplifters, a close second is due to employee theft.

It’s appalling to think that the people you pay to run your business can try to sabotage you, but it’s a fact. This shocking statistic cuts across every industry; distribution centre workers have devised elaborate methods of getting parcels delivered to alternate addresses, warehouse handlers collide with truck drivers to divert shipments, shop assistants swipe goods from the stockroom to sell on the black market etc. With so many avenues to diminish your company profits, from the inside, how can you prevent these losses?

The following installations have been proven to deter retail theft:

  • A collapsible grille.
  • Working burglar alarms.
  • CCTV or dummy cameras.
  • Visible security guards.

These will scare off most opportunistic shoplifters whose average theft loss per incident is £42. What of the next largest source of retail theft, whose loss per incident is over £300? Yes, your employees may be costing you more than you think.

Resolve All Handling Issues.

Warehouses and distribution centres are absolutely manic at this time of year. Many shoppers are taking advantage of next day delivery options. Warehouses are reporting sorting 7,000 packages per hour. In the midst of this organised chaos, parcels and packages get mishandled, fall off pallets, are tossed around by staff, even crushed by speeding forklifts. Counter the losses from replacing items by reminding your staff of correct handling procedures at the start of every shift.

Restrict Access To Sensitive Areas.

Not everyone on your staff requires access to your inner offices or server room. Restricting access reduces the chances of opportunistic crime. Issue electronic access cards to track and limit people who enter sections contain important information. You can also nominate trusted members of staff as key-holders.

Hiring Process.

 No matter if you are hiring through in-house staffing or by third-party recruiters, always carry out thorough background checks. The DBS check (formerly called the CRB check) can help track employment history. You should also ask for references from previous employers.

Incentivise them.

Sometimes, physical deterrents may not be the solution. What is your company culture? Are people happy working for you? Create a rewarding work environment. If you have people in over the holidays, look for ways to incentivise them. Offer discounts, bonuses, extra hours pay… remember you expect them to provide excellent customer service, always. Reward them accordingly.

Use Controls And Countermeasures.

Schedule more than one employee per shift; this has been proven to reduce theft. To prevent collusion, frequently rotate schedules and partners. Instituting a bag checking policy at the end of every shift will also help reduce employee theft.

Saying the retail industry has a problem with shady staff and customers who “forget to pay” is a blanket statement. Each store has its unique characteristics that make it easier to fiddle with profits. It is vital that you log incidents and over time, use the logs to discover where the exact source of shrinkage is.

At SRL Limited, we know how important the choice of roller shutter is to your bottom line. This is why we work with you to find and fit doors that will guarantee the security of your goods and profits.

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