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.
 

Police now say that shoplifting or retail theft is the biggest retail crime in Australia. The penalty is pretty minimal. 

Most shoplifting incidents tend to occur in specific retail store areas, typically concentrated in locations where higher-value items or easily concealed products are displayed. 

As a retailer, understanding where shoplifting occurs in your store is crucial for effective loss prevention. By mapping out these hotspots, you can implement targeted retail security measures to reduce shrinkage and protect your bottom line. I have seen it done, and it works. Let's explore how you can create a practical shoplifting map using your POS system and some simple tools.

Getting Started: The Basics of Shoplifting Prevention

To begin your shoplifting prevention journey, you'll need:

1. A recent stocktake in your POS software
2. A large piece of paper or white cardboard
3. A pencil
4. A tape measure or your pacing skills

Creating Your Store Layout for Optimal Security

First, draw a rough sketch of your store layout. This will serve as the foundation for your shoplifting prevention strategy.

Pro tip: Use a pencil to make adjustments quickly. I've found that creating these maps saves time and frustration.

Once you're happy with your layout, it does not need to be perfect. Now, make at least four photocopies. Label two "Quantity" and two "Value". Keep the extras for future use because there is much you can map.

Leveraging Your POS System for Loss Prevention

Now, it's time to dig into your POS system. Look for the variance reports in the stocktake section. These reports will show you the following:

1. Missing quantities
2. Missing values

Your POS system is a powerful tool in your loss-prevention arsenal. It can help you track inventory accurately and identify discrepancies quickly.

Mapping the Data: A Visual Approach to Retail Security

On one of your "Quantity" maps, jot down the figures for missing quantities in each area. Do the same for missing values on a "Value" map.

My experience: Using subtotals from your POS reports can speed up this process significantly.

Analysing the Results: Identifying Shoplifting Hotspots

Once you've filled in your maps, it's time to analyse. Add up the totals for each area and divide them into three groups:

• Blue = Good (low losses)
• Yellow = Moderate to bad
• Red = Terrible (high losses)

Now, colour-code your fresh maps accordingly - one for quantity and one for value. You will now have something that looks like this.

Interpreting Your Shoplifting Map: Key Insights for Retailers

Your completed maps will reveal a lot about your store's vulnerabilities:

1. The quantity map shows how often items are stolen
2. The value map indicates the financial impact of these thefts

Key Areas to Watch

Look for:

• Red areas surrounded by blue: These could be blind spots or areas with highly desirable items
• Red areas behind the counter: What is a real worry if it is behind the counter because then it's staff.

Important note: Remember, the area of loss might not always be where the actual shoplifting occurs. Thieves may move items before concealing them.

Here is one distribution of shoplifting hotspots in a store that I did for a client, categorised by severity.

Taking Action: Implementing Anti-Theft Devices and Strategies

With your shoplifting map in hand, you can now implement targeted anti-theft devices and strategies:

1. Rearrange store layout to eliminate blind spots
2. Increase surveillance in high-risk areas
3. Train staff to be more vigilant in problematic sections
4. Consider additional security measures for high-value, frequently stolen items

Effective Anti-Theft Devices for Small Retailers

1. Security tags and labels
2. Surveillance cameras
3. Convex mirrors
4. Electronic tags
5. Display locks for high-value items

Practical Tips for Shoplifting Prevention

To address the search intent of retail store owners and managers looking for actionable strategies, here are some practical tips:

1. Train your staff: Educate employees to spot suspicious behaviour.

2. Optimise your store layout: Place high-value items in visible areas, use low shelving to improve visibility, and ensure cash registers have a clear view of the store.

3. Use signage: Display signs indicating that shoplifters will be prosecuted. This can act as a deterrent.

4. Implement a customer service strategy: Train staff to greet and engage with customers. Attentive service can discourage potential shoplifters. Shoplifters do not want people near them.

5. Utilise your POS system: Regularly review inventory reports to spot discrepancies early.

6. Use dummy products: Consider displaying empty boxes for high-value items.

7. Install proper lighting: Well-lit stores deter shoplifters and make it easier to spot suspicious activity.

8. Implement a bag check policy: Require customers to leave large bags at the front of the store.

Revolutionising Your Approach to Store Security

Think of your shoplifting map as a retail security GPS. It will guide you to the heart of your loss prevention challenges, helping you protect your inventory and boost your bottom line. But remember, the retail landscape is constantly shifting—so keep mapping and learning. You'll soon have a clearer picture of your store's security landscape. Combine these insights with your POS System and vigilant staff, and you'll see a noticeable dip in your shoplifting incidents.

Give it a try. You will find something.

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.

Have you ever wondered where your stock disappears? You're not alone. Many retailers do not know. Yet, understanding stock shrinkage and damage rate is crucial for retailers. Let's dive into these KPIs. It will only take a few minutes to find out. Then maybe it can transform your business.

Shrinkage and Damage

Imagine this: You've just finished a stocktake, but the numbers did not add up. Sound familiar? That is shrinkage. And those damaged gifts at the back of the shop now? That's damage eating into your profits.

Quick Definitions:

• Shrinkage: Stock that's gone missing
• Damage: Stock that's no longer sellable without discounting

Crunching the Numbers

Let's get our hands dirty with some calculations. A full and detailed explanation is available here.  After a stocktake, working through the calculations should take a few minutes.

Some real-world case studies

Case Study 1: The Vanishing Vitamins

A pharmacy in Brisbane was losing $5,000 worth of vitamins each month. After calculating their shrinkage (2.5%), they discovered employee theft was the culprit. By implementing stricter controls, they reduced shrinkage to 0.8%.

Case Study 2: A newsagent in Sydney

They found that their margins on stationery were, in theory, about 50%. Yet they found that their margin was more like 32%. This is due to the theft rate. They rearranged many of the stationery and put it behind the counter, which boosted their profits dramatically.

Industry Benchmarks

I can give you some typical figures quoted, but almost everyone I ask tells me that these figures are educated guesses. Most quote a figure of 1% to 2% and then give a disclaimer to say they believe it is too much higher. Figures typically quoted are 1.5% shrinkage with a damage rate of 0.4%; here are some details. How do your numbers compare? If they're higher, panic!

What we do know is that since COVID, shoplifting rates have jumped. You can read about it here in every state; we are looking now at about a 20% to 40% increase. This is a worldwide trend; for example, in the UK, it was a 37% increase. 

Yesterday figures from the Victorian Crime Statistics were released for the year ending March 2024 here there is a concerning 17% increase in theft offences recorded for the period to March 2024, driven by the highest ever numbers of incidents from retail stores. They I think confirm an early report that shoplifting is at highest level ever here. I am sure the oother states will becoming out soon with similar figures. Shoplifting since COVID has been a disaster.

The Why Behind the Numbers

Shrinkage causes:

1. Sticky-fingered shoppers (shoplifting): One pet shop told me that the small items for the pets too often disappear.
2. Employees with light hands (internal theft): Lott is often a big problem here. An employee gets the sudden urge to grab and rub a scratchie, and it loses, so they put it down. 
3. Paperwork nightmares (administrative errors) - Often, lousy data entry has errors.
4. Dodgy dealings (supplier fraud) - I suspect this is all too common in newsagencies. I find it hard to believe that these errors we pick up are entirely accidents.

Damage Demons:

1. Clumsy handling 
2. Storage snafus
3. Time's Cruel March (expired products)
4. Rough rides (transport damage)
5. Sun causes the item to fade over time.

Ideas for Prevention

1. Regular Stock Audits: Don't wait for year-end surprises. Implement cycle counting to catch issues early.
2. Set SMART Goals: Use your percentages to set Specific, Measurable, Achievable, Relevant, and Time-bound targets. I discussed how to do them here yesterday. 
3. Train Your Team: Get your staff involved.
4. Upgrade Your Tech: A modern POS software and a camera system can be your best ally in the fight against shrinkage and damage.
5. Secure Your Space: Precious items should be behind the counter or under lock.

POS Systems: Your Secret Weapon

A robust Point of Sale system isn't just a glorified cash register. It's your 24/7 stock guardian. Here's how:

• Real-time Tracking: Know your stock levels at a glance
• Automated Alerts: Get notified of suspicious patterns
• Easy Auditing: Simplify your stocktakes
• Data Insights: Spot trends and make smarter decisions

From Numbers to Action: Implementing Change

1. Set Your Baseline: Calculate your current shrinkage and damage percentages.
2. Benchmark: Compare your figures to industry standards.
3. Identify Hotspots: Which products or areas are most affected?
4. Strategise: Develop targeted prevention strategies.
5. Monitor: Regularly check your percentages to track progress.
6. Adjust: Refine your changes based on results.

Loss Prevention Strategies That Work

1. The Power of Light: Well-lit shops deter thieves and reduce accidents.
2. Look for dead areas: Design your stock layout to minimise blind spots. Have cameras and mirrors there.
3. Inventory Management Software: Use technology to track stock movements accurately.
4. Get your employees involved: Often, they can pick up suspicious people. 
5. Customer Service Focus: Attentive staff naturally deter shoplifting.
6. Grandmother: This idea works. Have the grandmother at the front of the shop personally welcome everyone into the shop. 

The Bottom Line Boost

Reducing shrinkage and damage isn't just about preventing losses but unlocking profits. Here's the impact:

• Increased Revenue: Every item saved is an item sold.
• Better Cash Flow: Less money tied up in replacement stock.
• Enhanced Customer Experience: Your POS system will know the stock that you have.
• Improved Forecasting: Accurate stock levels lead to smarter buying decisions.

Your Next Steps

1. Calculate your current shrinkage and damage percentages.
2. Set realistic targets for improvement.
3. Implement at least one new prevention strategy this month.
4. Use your POS system to automate tracking.
5. Schedule reviews on loss prevention.

Remember, every small improvement adds up. A 1% reduction in shrinkage on a million dollar turnover business, at 30% margin is about $10,000 profit to you.

By tackling shrinkage and damage head-on, you're not just protecting your stock – you're safeguarding your success. It's time to turn those missing items and damaged goods into profit on your bottom line.

Running a retail business comes with many challenges. One key area that requires focus is staff security. While most employees are trustworthy, it only takes one bad apple to cause significant losses. It is a growing problem, have a read here.

The Importance of Deterring Theft

Implementing proper security procedures is necessary to protect your business and bottom line. In my experience, the mere presence of correct security procedures often deters such theft. If staff members see cameras and proper controls in the point of sale (POS) system, they are less likely to steal. So, it is essential to take retail loss prevention seriously.

Over the years, I have become cynical about this issue. Too many retailers have told me stories that start with "He was in school with me... his family and my family....he was very good, my best employee..." and something they start telling me how "He had been skimming my cash register for years." and how they only found out years later that a previous employee had problems with that person.

Some will take advantage if an employee sees you won't care about minor cash discrepancies. If they know a POS system is monitoring transactions, it makes them think twice. One client recovered almost $13,000 a year in extra revenue simply by having separate tills for each staff member and counting each cash drawer after every shift.

Configuring Staff Security in POS Software

It's straightforward to set up security features in our POS system. 

Please go to

Main menu> staff > staff maintenance

Then click the Security Level tab on the top

Now, you will see the user levels with our suggested functions for each level. Change them at will to suit your own particular needs.

Now click Staff Maintenance.

This screen appears

Now, set your staff with a suitable security level that they need to do their position. Make sure that you give them the functions and information they will need without compromising sensitive and dangerous functions and information.

The default settings are designed to work for 90% of shops. However, every business is different so that you can customise it for your needs. There are many options to choose from.

We can set these up, and then you can enforce them. Installing cameras facing the tills is also recommended.

Take Retail Security Seriously

Security in retail is often trivialised, but it doesn't have to be. With proper controls through your POS system and staff procedures, you can deter theft and protect your hard-earned profits. Don't become another cautionary tale - be proactive about retail security immediately. Your business will be better for it.