How to Prevent Retail Shrinkage

Hello again! It’s Michael back from KORONA POS. A lot of what we discuss on our blog and channel
surrounds ways that small business owners can grow their business and make more money. In this one, let’s look at a way that you
can save money: reduce retail shrinkage, more commonly known as theft. After all, no one likes to deal with a bad
shrinkage problem. 2017 actually saw some improvement from the
prior year, with a $2 billion reduction in theft. But, U.S. retailers still lost $46.8 billion
to theft alone. Unfortunately, this problem affects small
retailers a lot more than big box chains. Trying to cover a large theft if your margins
are low can take a long time. If you someone steals $100 and your margins
are about 10%, it will take $1000 of sales to make up the loss. Luckily, there are a handful of easy ways
to alleviate this problem, and in some cases, just eradicate it altogether. Start by analyzing your retail floor. It should be clean and organized. Clutter and disarray exhibit overall unorganization,
making it seem more feasible to steal. Keep your shelves stocked and faced. Open up the floor as much as possible. Additionally, keep displays unobtrusive and
aisles short. Dead areas of visibility are dangerous spots
in any retail space. Lastly, use your POS area wisely – keep the
point of sale and checkout near the door so each person leaving has to pass by. And use the area behind or underneath your
register to store small, higher-end products. There are also some small devices that can
help deter potential thieves. Warning signage is the easier way to start. Small signs warning shoppers that they are
on camera, or photos of past thieves will be good reminders for anyone on the fence
about committing a crime. Mirrors are another inexpensive tool to increase
visibility in corners or down long aisles. Consider attaching simple alert sensors on
your doors. The sensors don’t even need to be linked
to devices in the products, a simple greeting bell will raise more concern for stealing
anything. For more expensive items, especially electronics,
attach the product to the display shelves. This allows shoppers to interact with the
item without having to worry about any slipping into pockets. Staff training and education are also important
ways of preventing retail theft. Look for shady accessories, like big bags,
empty strollers, or baggy clothing. Keep an eye out for shift behavior, too. Anxious loitering or shopping without much
direction are both red flags. If you have the budget, keep employees stationed
at opportune checkpoints. Door greeters, dressing room attendants, and
even secret shoppers are common staffing strategies. Finally, watch out for internal theft. Unfortunately, 75% of retail employees admit
to having stolen from their employer at least once. You don’t want to assume that an staff are
stealing, but make it clear that you are aware that it can happen and that it will not be
tolerated. Your retail POS system can also also with
loss prevention. Start by giving every item a barcode so that
they are logged into the POS inventory. This includes a title and brief description,
making tag swapping harder. An easy to use inventory management system
will make discrepancies stand out, especially if you’re running inventory counts often. Your point of sale can also help prevent internal
theft with detailed employee shift reports and personalized cashier permission levels. Ok, if you have the budget there are some
pretty cool advanced anti-theft tools out there. Product tags or chips can be attached to all
or some products. Cameras and video analytics can target suspicious
behavior so you don’t have to review hours of footage. Electronic audio surveillance use RFID tech
to track more expensive products and alert sensors. For electronics, install software that needs
to be unlocked upon purchase to enable use. For most businesses, these type of tech solutions
aren’t necessary. Staying vigilant and sticking to best practices
will go a long way. Just don’t forget how common retail theft
is. To find out more about how your POS can help,
give our support team at KORONA a shout. And for more retail tips, subscribe to the
blog and channel here. As always, thanks for watching! We’ll see you all soon.

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