As a retail security group member, I recently got a disturbing incident that's been making waves in the US. On October 6th morning, a 7-Eleven store in Los Angeles fell victim to a violent "flash mob" robbery. A lone staff member at the store tried desperately to shut the doors as a mob of masked individuals approached. He was able to, till he threatened the clerk with a concrete slab, and the mob forced their way inside. Once in, the group attacked the employee and looted the store.

The video footage is genuinely shocking, so user discretion is advised here. Look at that girl filming the robbery for her memories.

It isn't an isolated incident in America; similar "flash mob" robberies have targeted over a dozen 7-Eleven stores across Los Angeles in recent months.

The incident sparked a heated discussion on Twitter which I thought was interesting over: 

1. Public Safety Concerns: Many users expressed shock and worry about the rising crime rates in urban areas.
2. Political Commentary: There was significant criticism of current leadership and policies.
3. Skepticism of Crime Statistics: Several comments sarcastically referenced official claims about crime reduction. Something that is true in Australia to, as most reatil crimes are not reported.
4. Cultural and Demographic Discussions: Some users drew connections between crime rates and demographic changes.
5. Proposed Solutions: A few comments suggested arming clerks or closing stores in high-risk areas.

The overall tone of the Twitter responses was frustration, concern, and criticism of the current social and political conditions related to crime and public safety.

I have never seen anything like it in Australia. But, it's worth considering in Australian retailing as it's not just about loss prevention but also the broader impact on our community and the retail industry here. I know in the UK a few years ago, no-one was worried about it and now its a major issue in their retail shops.
 

I've seen firsthand how crucial POS security is for brick-and-mortar shops. Today, we're diving deep into staff security levels in point-of-sale software, a topic that's essential for retail loss prevention.

The fact on Employee Theft

Let's start with a sobering statistic: employee theft accounts for 33.2% of shop theft.

I've become cynical about this issue. Why? Because I've heard the same story again and again for years:

"He was in school with me... his family and my family... he was my best employee..."

And how does it end? With the fact that this trusted person had been skimming from the till for years. I was there seeing an owner of a newsagency is in tears when he saw a video of his best friend who he knew since childhood stealing money from him.

Let me tell you, the mere presence of a robust security system can work wonders. It's like having a guard dog—just seeing it can make potential troublemakers think twice. When your staff sees cameras and proper POS procedures in place, they're less likely to consider any funny business.

The Power of Staff Access Control

One of the most effective tools in your employee theft prevention arsenal is staff access control. Here's a quick guide to doing it in our POS software:

1. Go to "Staff Maintenance"
2. Navigate to the "Security Level" section
3. Customise access levels based on job roles
4. Assign each staff member their appropriate level
5. Regularly review and update access permissions

We've set up defaults that work for about 90% of shops. But every business is unique, so you can fine-tune these settings to fit your specific needs.

Security Level Options

Here's a table showing some standard security-level options:

Implementing Effective Staff Security Measures

Remember, the best security system is only as good as its implementation. Here are some tips to ensure your retail loss prevention strategies are effective:

1. Train your staff thoroughly on security procedures
2. Lead by example - follow the protocols yourself
3. Regularly audit your security measures
4. Cameras, if they can be seen and are being recorded, it probably will not happen
5. Reward staff for identifying and reporting security issues

The Bottom Line: Protecting Your Assets and Revenue

By controlling staff access, you're protecting your business.

Retail theft is rampant in Australia, particularly since COVID-19.

In April 2023 "Griffith Criminology Institute Professor Michael Townsley said retailers lose thousands of dollars per year because of retail crime, .... On average, an individual external theft incident costs a retailer around $415 compared to an internal theft incident costing an average value of $1200."

In some industries like newsagencies, I can see figures quoted between 3% and 5% of total sales.

That is a considerable amount as many retailers today are operating on slim margins. These losses can be devastating. The most troubling part? Most retail theft is internal, committed by trusted employees. We have heard tearful stories from retailers who discovered longtime employees and even family members stealing from them.

There are some protective steps you can take. We believe the best approach is implementing proper procedures and monitoring everything with the right tools, like a POS system with advanced reporting. Ignorance is not bliss here.

Use Your POS System to Uncover Internal Theft

Our POS software includes a unique security system that monitors key indicators for suspicious activity from each operator using your system.

Here is a start in your system: our unique security system monitors what people operating your point of sale are using. We call it the Retail Protective Key Performance Indicators. 

These indicators give you a detailed breakdown for each operator, statistics on such things as their usage of no sale, voids, count, totals, refunds, negative items and discounts they are doing. Pay particular attention to any huge numbers in specific voids.

To run it, go to cash register reports. (see orange arrow)

Then select Staff and click on "Sales security indicators" (see blue arrow)

Please select the required period you wish; I recommend doing it monthly.

What you are looking for is that most thieves have a method that works for them; they become a creature of habit, and as such, with these people, one indicator is generally up.

So you are looking for someone with one very high item. So, run this report monthly to analyze trends over time. Focus on operators with unusually high numbers for:

• Voids
• No sales
• Refunds
• Discounts
• Negative items

For example, no sales and voids often go hand-in-hand for legitimate reasons. But if one is sky-high and the other normal, that warrants a closer look.

Complement POS Monitoring with Other Fraud Prevention

POS indicator reports are precious for identifying potential theft. However, they should not be your only defence.

Some additional fraud prevention tips:

• Conduct regular inventory audits
• Install video surveillance
• Perform surprise cash drawer counts
• One cash draw one person
• Enforce strict POS access controls

Protect your livelihood by leveraging tools like security indicators. Failure to actively prevent retail theft leaves the door open for disaster. We are here to help - let us know if you have any other questions!

In your shop, it is vital to ensure that everyone that uses your POS Software has their unique (ID) and that they use it. This practice makes people accountable and helps keep track of who did what.

Sharing logins is NOT to be permitted.

This makes tracking what people are doing easier. Do this, and you can examine quicker errors and discrepancies and search for suspicious behaviour.

We had a situation last week where something went wrong with a transaction a few months ago. The shop owner had no idea who did it as the ID is used by many people in the shop.

Another example was that our client's evidence was rejected in court because the employee used an ID considered a generic code, rendering the evidence inconclusive. This unfortunate incident highlights the importance of adhering to the policy requiring employees to be issued individual IDs.

Conclusion

Please make everyone that uses your POS Software have and uses their ID.

Executive Summary:

> Everyone in the shop which uses the POS software needs a unique ID.

> Sharing logins must be wholly disallowed.

> Individual IDs simplify error detection and suspicious behaviour investigation, enabling activity tracking and raising accountability.

Security is a very important topic at the moment. Australia has had seven (7) significant breaches in a month. 

So please see our latest newsletter for information on how best to maintain security in your software.

The reality is that almost all security hacks today result from someone doing the wrong thing. 

Now your computer and its POS System can be set to allow security settings based on an employee's role in the business. This approach gives you control over who has access to your information. We suggest that you put this in place if it is not in place.

As it is often so easy for unauthorised people to get your passwords in a business environment, we suggest that your passwords be regularly changed. Industry-standard is at least once a year.

At the very least, please ensure someone needs your password to log onto your computer. That simple procedure will stop most computer data breaches, and it is so simple to put a password on your computers. Consider this your first and most powerful line of defence. If a hacker can get through this, they can get into your system.

In reviewing your stock shrinkage, first, consider the four major categories. In order from highest to lowest, they are:

Employee/internal theft
There are bad people everywhere. No one knows your control systems better than your staff, and some take advantage of you. Dishonest staff will sell goods without being recorded. If I bet with you that one of my clients this month would call us about a bad employee, I would probably win. 

Shoplifting
Some shoppers do steal. This is particularly true of small items.

Sales errors, administrative and paperwork errors
Unfortunately, errors do occur. People do enter the wrong figures as they get careless and make mistakes. With computers, one error in a system often remains for all time. A special discount wrongly entered can result in customers getting a bigger discount than they should.

Vendor fraud or error
Unfortunately, it happens. The supplier, either on purpose or in error, makes mistakes. It does not seem to matter whether they are big or small; it happens with all. Again once it gets into your system, there will be problems. This is getting worse as we move from manual to electronic systems problems; we lose the extra layer of security in manual entry. Today if a supplier makes an error, it can get imported into your system without review. 

 
Your first prevention strategy for stock shrinkage is to review locations.

This is very easy to do in our POS system, almost trivial once you have done a stocktake. 

Go to the stock-taking section.

Now, look at the variances. 

Now review the places in the shop that have high values. 

A helpful practise here is to go to the area:

Now run through the stocklifting categories above. If it is in an area where only staff can go, warning bells should sound. 

Now imagine that you are a shoplifter. The fact is most shoplifters plan so:

*How would you do it? 
*Why pick this area? 
*Why were these goods picked? 

One client of ours had a relative come to the shop and act out being a shoplifter. It proved quite a useful idea.

Now consider moving items from there; moving mirrors, cameras, and shoplifting signs should be considered. 

Often minimal changes at no cost can result in dramatic reductions in stock losses.

Shoplifting and anti-theft signs are proven methods of reducing shoplifting. The big plus is that they are low-cost. What they do is show that you are aware and alert and that they will face the consequences of shoplifting.

Here are some interesting statistics

-one survey found that 84% of customers noticed security signage
-70% believed the words on the signs.
-50% of shoplifters indicated that they would either go to another store or not steal anything if surveillance signs were in the area.

Here are some tips on antitheft signs.

1) Instead of wasting marketing space on your shelf or floor space with your shoplifting signs, place them up high where shoplifters will most likely check for surveillance cameras
2) Place near the entrance, many potential shoplifters will see when entering besides many do not go deep into the shop anyway.
3) The sign should be in red.
4) Putting a pair of human eyes on your sign dramatically reduces theft. This sign reduced theft of bikes by 62%

For a discussion of the formal reasons why eyes work, click here.

5) Put signs in places shoplifters might believe is a blind spot in the shop; to remind them just because they can't see you does not mean that you can't see them.

Of course, for a well-rounded security plan, you should combine security signage with other security and protection measures.

Retail Security: How To Prevent Shoplifting

For stocklifting, we usually expect about 1.33% on turnover. A rule of thumb is that a higher cost of living, will drive this up but how much we do not know yet. Also the increased idle time many in our community have, the reduced staff in shops and the wearing of masks have created a boom in shoplifting.

The reason it is now in the minds of retailers is that after a stocktake; they know they can determine their shoplifting figures.

Once done, our POS System will give them three figures: quantity, cost and totals. All tell a story.

Tips for what can be done?

Here are some thoughts for a webinar that I attended on this subject recently:

1) Quantity will give you a hint of how many such incidents occurred.

Cost is how much it costs you.

Totals will tell you how valuable this is to the thief.

So reviewing these figures will highlight departments and goods that are most at risk.

It will also give you an idea of what is being taken.

2) What I do suggest you do is map your shoplifting figures see here. It does not take long and will graphically show the current danger points in the shop.

3) Consider mirrors and cameras. An old mirror placed in a blind spot was shown to reduce theft dramatically there. That cost the retailer nothing. Shoplifters are looking for these details.

4) Greet people that come to the shop. As well as being good customer service, it shows that you are watching.

It is hard to identify people in advance. In a survey, 75% of shoplifters said they had no intention of committing it before entering the shop. Very few fit any profile.

Yet here this is an interesting idea from the webinar. Have grandmother greet everyone that comes into the shop. Besides showing that you care, it has been known to do wonders. Grandmother has been proven to be very effective in identifying dubious people, such as people who often come without buying. She is also excellent for shaming people thinking of stealing. She is also a great witness if things go legal.

5) Have enough staff. Much of the current problem with shoplifting is that many retailers have reduced staff. No one is monitoring the stock yet there is a lot of money there. Having a staff member go to a suspicious customer and ask, “How can I help you?” can do wonders. 

6) Show a security monitor in the front of the shop where customers can see it before entering. This shows that you are monitoring.

7) Good signage. This issue I will discuss in a future post after I go to the next webinar.

8) Review the shoplifting figures this will give you an idea of the size of the problem and allow you to make a shoplifting budget. in the future.

9) Do not display highly desirable and/or expensive items close to the shop's exit.  

It is too big a temptation for someone to grab and run and it is very hard to stop such actions particularly if you pile high-value items together.

Shoplifting prevention and detection security prevention retail loss shoplifting are all important in order to keep your business safe and protected from losses.

To combat shoplifting, which now is a plague, several large retailers in Australia are using facial recognition software. You can read about it here. It is used now to prevent theft and threatening situations. It identifies individuals of interest who have formerly been involved in high-security incidents.

Our POS software has an extensive video security system inside of it. So we can handle this and could integrate it if the information was released to our clients. Then our systems could warn the people in the shop if a known shoplifter or violent people entered the shop.

There would be privacy issues, but I'm afraid I have to disagree with Choice consumer data advocate Kate Bower that the system is "a completely inappropriate and unnecessary use of the technology". 

Please have a read the above article and make your mind up.

You do not see this much, four robbers came into a store to rob it and three employees immediately ran to whip their asses. That lady clearly has some kick.

Track staff for all sales transactions.

What is all too common is that a transaction has occurred which appears strange. A something does not appear correct, you want to investigate, but you do not know who did it. Typically it could be the price, the discount, etc. 

With our POS software, you can make it mandatory to put a staff ID on each transaction. This staff ID can be set to remove or reduce options for employees to give discounts to customers. So you can stop many of the queries before they happen.

Plus, once the staff ID is used, you have a data tracking system. You can then track every sales transaction entered into your system to see exactly who did what and when.

Firstly what you need to do is enter a unique staff ID for all staff.

Go into staff maintenance

Your Retail Protective Key Performance Indicators are the main indicators used to help you see what people on the registers are entering your system. They give you a detailed breakdown for each operator on no sale, voids, counts, totals, refunds, negative items, and discounts. One figure I suggest you look at in particular is the voids. 

These indicators should be used as part of your loss prevention plan for your shop's internal theft, which is today's most significant form of theft.

Let us start a check.

Go to cash register reports. (see orange arrow)

Now select Staff and click on "Sales security indicators" (see blue arrow)

Select the required period. 

These indicators should be regularly checked.

PS I have noticed that years ago, people used to say if caught that they are sorry, now they tend to say the boss is so stupid .....

Biometric identification is becoming better so more important in security. Rather than using a password, you use some physical characteristics of yourself. There are some real and immediate advantages to using them:

1) Unlike passwords, your biometrics are always with you and cannot be lost or forgotten.

2) Biometrics can't be stolen like a password. In a shop where people work close to each other, this can be a real problem.

3) They are the only identification systems in use now in retail that can verify an individual's identity with near certainty. Security on passwords can be dubious as people who work with you may know your passwords, but they do not have your fingerprints. Unlike ID cards and passwords, people cannot steal them to gain access to areas of your software where they should not go.

4) It is often much more convenient as people walk around with their fingers. They usually do not walk around with their employee ID cards.

5) It also makes it harder for hackers who have developed elaborate schemes to break into your computer systems. Now they have to hack the native security system of the biometric system too.

Integrated biometrics can safeguard your system.

If you run a shop and you are trying to prevent employee theft? Well, you are not alone. We see many that have suffered significantly from employee theft.. On average more than 40 per cent of all retail theft is committed by staff. 

One of the best things you can do is give each operator their own draw. Then make each responsible for balancing their own draw for each shift. Our point of sale allows one computer to run many cash draws. If you have not got this setup, I suggest contacting us about it.

Another point is that you need to check your security KPIs to see if they can show some malicious behaviour.

These indicators give you a detailed breakdown for each operator on how many functions each staff member is doing. This works because the malicious staff tend to work in a habit. If something works, they repeat it. It does not take much. $ 50 a day can be $15,000 over a year.

To check these security KPIs, go to cash register reports. (see orange arrow)

Then select Staff and click on "Sales security indicators" (see blue arrow)

Select the required period, usually monthly. 

A report will pop up with many indicators.

As most thieves have a method that works for them, they tend to use it almost all the time, so what you are looking for is unusually high indicators. 

Unfortunately, there’s no denying that employee theft is a reality of retail operations and that it must be monitored.  

Today, Amazon held its annual display for its coming new products. A few items excited me.

One item I thought would start a revolution in shop security.

It is a robot that, among other things, can do security work and perform automated security patrols of the shop.

- My first thought was how many times did I have to go to the shop after hours because Mum or my sister suddenly became nervous that they had forgotten to lock the shop up? With its periscope camera, it can go high enough to allow you to check the door's lock remotely.

- How often do alarms go off for no reason? Usually, there is a reason, but there is no way of knowing the reason after a few minutes. The raccoon in the video below is a case in point.

- Most thieves today at night are smashing and grabbing. They know from when the alarm goes that they have so many minutes before the police arrive. If such a robot were present, they would know that the storekeeper could get instant monitoring.

- Often, the security guard is a risk. Unfortunately, this happened to one of my clients in a shopping centre where people could reach given time into the shop's front window with a stretch where stock is on display. Stuff went missing overnight, and no one knows who took it. Since there is only security guards present in that period.....

Here is a video of what it can do!

Having a robot that can run up and down the shop carrying something would be handy too. 

I would love to get one to try out!

Biometrics security is when you use peoples fingerprints, facial pictures, etc rather than passwords. Many mobile phones use it. Many of our clients use it on their POS Software for over four years since we first introduced it to our marketspace. 

One of my clients met a credit card, where the information was swiped. The owner of the card did not know it was swiped. Swiping leaves no trace. A girl with the info went on a shopping spree. She did not take long to spend just under $30,000. With the new biometric cards, this will be impossible. 

Soon I suspect all retailers will have no choice but to use biometrics as the banks move to this security. So if credit card details are known, even with the PIN without the owner's finger, it cannot be used.

In theory, whether in practice one hack is proposed for the most popular types of biometrics security, which most of us use. It is claimed that it can be cracked.

Now we use the fingerprint method.

This involves some new equipment that is not expensive. Its big plus is that even if others know the password, they cannot get in so its much more secure

Yet, although people talk about the advantages of biometrics, it does have some drawbacks.

Delay: This is the big one. It takes too long. You have customers queued up, and the operator, if they have to wait a few seconds to process, is just too long. That is why we currently do not use it on the cash register.

COVID, as fingerprints are contact-based, people do not want to keep pressing the same pad as everyone else. 

Errors caused by the sensors, which are not perfect, cause problems. Although a fingerprint is better than a pin, errors still occur. Some court studies show the error rate, fingerprints errors showed they vary from 3% to a dismal 20%.

Shops are dirty environments, so people have wet hands, dirty fingers, etc. Often the operator has to wipe their hands, then try again. This causes more delays.

Our system is often used by people with physical disabilities, e.g. MS. They can have problems using the fingerprint scanner. 

Have a chew and if you want to know more, let us know. 

​

A person takes an item in the store and then presents it to get a credit. This is one of the most common scams that target retailers.

You have this nice policy above, now watch it abused.

​In my experience, here are three common scenarios.

1) The person has no documentation, like this guy here.

2) A customer purchased the product. They give, use or often find a receipt often thrown out in the rubbish bin by the purchaser. Now someone comes into the stop with the receipt. They take the same product from the shelf and then request a refund.

For this reason, receipts should always be put in the packaging of the purchased item.

3) People fake your receipts to return stolen goods for cash refunds. It is easy to do with a smart camera and some image editing software.

To stop this you need

a) A good return policy

b) A POS System that can track sales. Always look up the item sale into the POS System to verify the original sale.

c) You need a good security camera.

Protecting your information in most retail shops is hard. This is as generally, many people in your business have access to your system. We used to set up all our clients with a secret VeraCrypt drive to get over this problem. No-one can read that drive unless they have the password. To get your information, they need your password to log into your VeraCrypt program. This makes your information secure on an open network. 

This is one of the best and trusted encryption software for Windows. 

You can get a copy of the software here.

For an explanation on how to use it and set it up, look here.

If you are going to use it, here are some tips.

1) Never use AES+SHA-512. There are many other options, so select something else. This is because if someone is trying to break into your system, they will assume you are using it.

2) Do a complete shutdown when you finish with Veracrypt. You can do this by hold down the SHIFT key on your keyboard and then click the "Shut down" option in the Start Menu. This is because your password is in RAM, and the hibernation file 

3) Use a new password and make it long. Almost all cracked systems are because someone knows or guesses your password, e.g. your child's birth date. 

4)  Make a "Hidden VeraCrypt volume" for your sensitive information. 

Doing this is another advantage too if your computers are lost or stolen, no one can read your private information.

Enjoy your privacy.

Your Retail Protective Key Performance Indicators can show you what your people at the point of sale terminal are doing. It is a security check.

By far, the most critical indicator is the number of voids. 

Now I will take you through it. 

Go to cash register reports. (see orange arrow)

Now select Staff and click on "Sales security indicators" (see blue arrow)

Please select the required period you wish; most do it monthly, so pick this month.

Now, this report comes out with lots of indicators.

Check the individual to the collective.  What you are looking for is some indicator that is way different without a good reason.

I find it useful to rerun it with the same dates last year and then for the previous month and check against this month.

With COVID and the increase in electronic money usage, I am sure that the theft rate on cash is up. A thief will tend to take the same amount, but the pool of cash is less.