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Protecting Your Business from Retail Shrink

Inventory shrink is the loss of products from employee or customer theft, inventory and accounting errors, and loss due to things such as spoilage or damage. Maintaining a low shrink rate is one of the most important aspects of maintaining profitability.
Retail shrink, however, is multidimensional and addressing the problem effectively requires an all-encompassing approach to security as a way to improve all operations rather than seeing security as just a tool to catch criminals.

Improve Operations

Improving storewide operational execution by using video surveillance technologies helps to maintain high levels of execution. When great processes are in place anything out of sync stands out and can be corrected quickly. This can help reduce loss due to accounting, lost or forgotten inventory, and spoilage. Maintaining high levels of execution also helps employees spot shoplifting easily, and helps them to refrain from the temptation themselves.

Reduce Accounting Errors

Security technologies can provide a wide view of the store and its operations but it can also help zero in on POS to help identify and correct errors or acts of fraud.

Product Protection

Another important aspect of preventing shrink is how well you protect your assets. Using tools such as access control is essential in controlling product storage areas.

Video Surveillance is a Crime Deterrence

The two most effective ways to deter theft are to make it too difficult and too risky. Video surveillance technologies are highly effective because they make it difficult to commit shoplifting without getting caught. This is a very important factor as preventing theft is much more cost-effective than catching it.

Video Analytics are Golden

Video analytics are great for telling you what products are performing well and why, but they can also provide insight as to why certain products or particular areas of the building see much more loss. It can also help you manage on-shelf availability and avoid over or under inventory. It also provides information that allows you to better evaluate store operation in relation to patterns of theft and allow you to make adjustments to store layout, product location, and employee engagement.

S-Tron has over 20 years of uncompromising industry experience and is dedicated to helping retail operations reach their security goals. From video surveillance and access control to intrusion detection and business analytics, S-Tron beats the competition coast to coast.

What Retailers Need to Know: Shoplifting 101

In 2016, the average inventory shrink rate increased to 1.44 percent. According to the National Retail Security Survey 2017, shoplifting by outside customers accounted for 37% retail inventory loss, followed by 30% in employee theft, 21% in administrative errors and 5% in vendor fraud. Together this loss accounted for $48.9 billion worth of inventory.

There are Many Ways of Controlling Shrink

Detecting and preventing shoplifting is an important part of any retail establishment. Whether caused by internal or external causes, controlling shrink is one of the most significant factors in controlling expenses. To do this, retailers have several options including employee training, auditing, loss prevention personnel, and loss prevention technologies.

Different Approaches to Address the Problem

Different establishments approach loss prevention differently, largely guided by budget and philosophy. The main focus could be deterrence, detection, or apprehension, and depending on the retailer’s philosophy, the loss prevention strategies utilized and policies instituted will reflect that philosophy.

Cost Effective Loss Prevention Technologies

Loss prevention technologies address every aspect of shrink, from deterrence to detection, and ultimately apprehension. Some of the most cost-effective strategies include CCTV and video surveillance, business intelligence software, and ScanCam. ScanCams helps prevent employee-caused shrink such as barcodes not registering, or making up fraudulent returns.

Quick Tips for Shoplifting Prevention

  • Use video surveillance and CCTV. Visible security deters crime.
  • Greet customers as soon as they enter the store to remove anonymity.
  • Watch for customers who avoid eye contact, seem nervous, wander the store, linger, or exhibit suspicious behavior.
  • Encourage employees to walk the store and talk to customers.
  • Keep the store clean and organized to maintain visibility.
  • Keep commonly stolen items in plain view.
  • Do not under-staff.
  • Eliminate employee distractions.
  • Post warnings in dressing rooms or bathrooms.

Stopping a Patron

Shoplifting laws allow retailers to stop and detain a person who has stolen merchandise. To do this properly in a way that can lead to prosecution requires following proper protocol.

  1. The employee must see the customer enter the area where the subject item is displayed.
  2. The employee must see the customer select and pick up the item.
  3. The customer must see the customer conceal, carry, push or pull the item from its location.
  4. The employee must maintain uninterrupted observation of the customer from the original location of the item to the point of detention.
  5. The employee must see that the patron failed to pay for the item.
  6. The shoplifter must be approached outside the store or after the last point of sale.

By properly addressing shoplifting with the right tools and strategies, a retailer can effectively reduce shrink. S-Tron has over 20 years of uncompromising experience in helping retail establishments reach their security goals.

Retail CCTV Business Analytics Matter. Here’s Why.

Over the last decade, the retail industry has experienced a transformation. As consumers spent more dollars shopping over the internet, traditional brick and mortar stores had to reevaluate their strategies and direct their focus on customer experience, store operations, and improved efficiencies in addition to loss prevention. It is a subtle shift with giant implications.
Traditionally, retailers have used CCTV and video surveillance primarily for physical security and loss prevention. Now, with the availability of high-powered computing platforms and advanced analytic algorithms CCTV and video surveillance help retailers make informed decisions that provide a competitive edge.

What Else Can Business Intelligence Do?
Loss prevention is a huge part of retail video surveillance, but retailers can get much more out of their investment—business intelligence. Business intelligence provides the insights retailers need to enhance sales and profit margins that affect the overall bottom-line.

Enhanced Customer Experience

Until recently, retailers had to rely on learning customer shopping trends through loyalty cards and POS transactions. While it did provide information on end-result shopping trends, it did not provide information about demographics, in-store behavior, or customer experience. Business analytics show how long customers spent in the store, what displays made the most impact, how long they waited in line, and whether or not the experience was positive. Knowing these things can help a retailer make better decisions in the moment and adjust strategies in real time.

Better Performance

Leveraging business intelligence provides key performance metrics so retailers can identify trends, or problems. They can also use the data to help compensate and incentivize performance.

Optimize the Workforce

One of the biggest costs in retail is staff. Staffing is also one of the most difficult aspects to manage. Overstaffing increases operational costs and understaffing can mean poor operations, dissatisfied customers, and ultimately- lost sales. By having a full view, and detailed analytics, business owners and managers can monitor shopper traffic and customer behavior to make better operational decisions for scheduling and staffing needs.

More Effective Merchandizing

Whether it is the right product, wrong placement or an altogether flop of a product, video business intelligence gives retailers an immediate understanding of customer behavior. The right information provided in the right time can make a dramatic improvement in sales.

Better Store Layouts

Comprehensive data about in-store movement patterns quickly reveal areas of bottleneck, hot spots, and areas that are infrequently visited. With this information, retailers can modify the store layout to better accommodate the shopper and drive shoppers through the store and to areas they might not have otherwise visited.

Today’s retail environment is competitive and leaves little room for error. Business analytics help retailers meet customer needs by zeroing in on customer experience and convenience—and drive sales. S-TRON specializes in retail loss prevention, CCTV and business intelligence and understands the needs of the retail business.

Why Should a Business Owner Opt in to Professional CCTV Systems vs Big Box DIY?

The integration of security technology into the business landscape has grown so quickly that it has become commonplace. Whereas once business owners debated whether or not to use security cameras and wondered if it could have a negative impact on their business, now CCTV security camera systems have become standard security equipment for businesses of any size in every industry. With the wide availability of DIY security options, the new question becomes, “Why should a business owner choose professionally installed CCTV systems over a DIY option?” There are some important answers.

There is a Difference in Equipment Offerings

Just like with any technology, there is a wide range of prices, quality, features, and operability between any given product type. Those differences are not necessarily apparent at first glance but become so while in practical use. There is a vast difference in security camera CCTV systems made for the professional market from those made for the commercial consumer market. Those differences can be critical when it is time to capture a crime on video and use the images in court.

Placement is a Science

Camera placement is tough. It takes an understanding of how to capture images in any given space as well as a vast knowledge of the capabilities of many different brands and types of cameras. I a commercial and business environment, it is essential to cover as much space as possible and use the correct cameras to cover critical areas, such as POS.

CCTV Systems are not One-size-Fits-All

Every business facility has a unique layout and orientation with different lighting issues. It is impossible to meet all of the needs and requirements of a business with a general DIY system or without a high level of knowledge and specificity.

They Must be Installed, and Integrated

Every CCTV surveillance system must be installed and should be integrated with the rest of your security and automation system. This means understanding system requirements, compatibility and capability issues—all of which impact the system wide functionality.

DIY Does Not mean Budget Friendly

One of the main reasons businesses consider a DIY system is price, thinking that the initial cost is much lower. In some cases, this can be true—initially. Keeping in mind the difference in equipment quality, DIY systems might have a lower initial cost in equipment, but that’s where it stops. The true cost comes in the time and effort involved in installation, integration, maintenance and all too soon, replacement. Even worse, poor quality images or not having covered an area where a crime occurred can also end up being quite costly in court.
Big box does not mean big savings or quality. When it comes to something as important as commercial security, it saves time and money doing it right the first time. S-TRON is an electronic security integrator for national and regional retail and hospitality companies, serving specialized needs with just as specialized solutions.

Retail Loss Prevention: 5 Ways to Maximize CCTV Systems

Retail theft, whether it is due to shoplifting or employee theft, is one of the biggest factors negatively impacting the profitability of any retail establishment. No matter how secure a store may be, there are always ways to improve security. One of the best ways to do that is to ensure that you are maximizing your video surveillance and CCTV system to its full effectiveness.

A retail video surveillance and CCTV system is an essential part of any loss prevention strategy. Here are a few simple but critical ways you can maximize your system and reduce theft.

Prioritize Your Cameras

Most facilities do not have a surveillance system that covers every inch of the facility. There are many common reasons for this, including unique and challenging store lay out, physical obstructions, and budgetary issues. Take a close and critical look at the business layout and processes and prioritize what needs to be covered, then implement the security camera coverage accordingly.

Position Your Cameras Wisely

Often, a business owner will have an idea of the area that needs to be covered, but fails to consider the conditions under which it would be recording as well as the capabilities of the camera. Video surveillance camera placement is not just about the optimal angle, it is also about optimally using the camera’s features and capabilities within the given environment.

Maximize Your CCTV System with the Right Cameras

Consider the true needs of each area of coverage, and then match the type of camera to the need. In many cases, a facility does not need more cameras. It just needs the right kind for the application, whether you need to cover POS in fine detail or a way to better capture images over a wider space in challenging lighting.

Consider a CCTV System Upgrade

If you have had your CCTV system a while, consider investigating what options are available today. As security technology advances quickly, upgrading can have significant value to the business in many ways, in addition to loss prevention. The cost of upgrades is minimal compared to the added value.

Integrate Business Data with Video Surveillance

One of the most valuable ways to maximize your CCTV system is to integrate it with business intelligence. The insights provide a more in-depth view of the business so that you can stop loss, reduce shrinkage and improve processes. The insights you gain are immediate and actionable and the results are powerful.

Installing, upgrading, or integrating your retail CCTV system can foster profitability and peace of mind. Established in 1995 and headquartered in Melville, NY, S-TRON serves thousands of retail locations with distinction.

Consumer or Commercial Grade Video Surveillance? What’s the Difference?

Most people in the market for a video surveillance system wonder: What’s the difference between consumer and professional, commercial grade CCTV and video surveillance systems. Will consumer grade surveillance systems work for a small or medium size business?

No matter the size of the business, commercial and consumer video surveillance systems are two completely different products and there are some differences that make them specific for their intended usage.

So Many Options in Commercial and Consumer Grade Video Surveillance Camera Systems

There are literally thousands of choices in video surveillance on the market, so it is easy to get lost in a sea of brands and options. There is a way to make it much easier to understand the options when you know that you can divide all of the choices into two groups: those intended for commercial use and those intended for residential usage.

Some Key Differences in Surveillance Systems

Because surveillance systems are made to fit a specific usage, they all have some basic differences that would impact your decision.

  • Commercial Systems have additional options to meet needs that are specific to their intended application, such as dramatic lighting changes, expansive spaces needing full coverage, analytics, exception reporting, networking, scalability and more.
  • Consumer Systems are made for the residential market. They offer features that are specific to residential needs, such as unobtrusive design, most suitable cameras and components, affordability, accessibility, and a host of other design features that make them a good fit for most consumer uses.  

But They Are Not Interchangeable

Video surveillance systems have become increasingly high-tech and complex as the industry rapidly advances. Because of this, it is getting harder to know which systems are intended for what, or what features you need. The systems are different, however, and no matter what level of features you want, you will find those features in a system designed for your application. Here are some reasons why the systems are not intended to be interchangeable.

  • Commercial Systems are not a good option for typical consumer usage because the system altogether would be complete overkill. The consumer would be left with a set of features that do not add anything to their security needs and complicate its usage. Additionally, a smaller space would impact the effectiveness of the cameras.
  • Consumer Security Camera Systems are conversely, not fit for business, professional, or commercial applications. Consumer systems do not have the features businesses need and would not be helpful in things such as combating shoplifting or useful in fighting false claims of injury. Consumer security systems are not made to power commercial grade cameras, such as infrared night vision security cameras and would render a commercial system virtually useless.

The retail, grocery, c-store, and restaurant industries have very specific security needs. S-Tron is an electronic security integrator with local and national reach specializing in meeting those needs.

 

Commercial Security for Retail Matters More Than You Think

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.