One of the most valuable reports to any retailer is the National Retail Security Survey. The most recent, the 2016 report, reveals something every retailer knows. Theft hurts a business. In 2015, inventory shrink totaled $45.2 billion, up by $1.2 billion from the previous year. While the number is staggering, we can learn one very important lesson from how the numbers break down– commercial security for retail matters, a lot.
Shrinkage is an ENORMOUS Problem
But it could be worse. While the total amount of shrinkage is up, it represents the lowest percentage of sales in the survey’s history. So, retail sales is growing faster than the shrinkage. What is making the difference? The implementation of industry specific commercial security for retail. Since more retailers are implementing sophisticated loss prevention technologies, sales have increased.
Employee Theft is a Bigger Problem Than We Think
No employer wants a culture of suspicion, but the study reveals that preventing internal theft needs more attention. In 2014, internal loss broke down in this way:
- Shoplifting 37%
- Internal Theft 35%
- Paperwork Errors 17%
- Vendor Fraud 7%
- Unknown Loss 6%
This means that internal theft is just as concerning as shoplifting! But internal theft is also more sensitive to handle, and much more personal. No employer wants to believe a trusted employee is stealing, and obtaining sufficient evidence of criminal activity is very difficult without the help of sophisticated loss prevention technologies. The narrowing margin between loss and percentage of sales indicates that the increased usage of POS systems, access control, and remote access.
Implementing Loss Prevention Solutions is a Win
The commercial security industry is rapidly advancing, and retailers realize the value in implementing these technologies in loss prevention. Most retail store owners report adjusting their security budget, allocating more money for electronic solutions, and seeing the reduction in loss.
Spending Wisely is a Must
No matter the size of the security budget, retailers are realizing that those funds must be spent wisely. This means leveraging the knowledge of electronic security and retail loss professionals who both understand the capabilities of the individual technologies as well as the complexities and demands of individual retail establishments. More retailers are seeing the importance of having a professional recommend solutions that can be fully integrated to provide valuable actionable intelligence which results in a lower total cost of ownership.
S-Tron specializes in retail loss prevention and commercial solutions to help retailers leverage data to target loss prevention and drive sales. Contact us today for a free consultation.