What if I told you that Nomar Casey’s biggest promotion came after he delivered zero cases for a quarter? As a loss prevention professional you’re probably thinking that this scenario can’t be further from the truth; however, as the retail world continues to evolve it is already happening at different organizations across the country. As technology advances and margins become more vital than ever, loss prevention’s roll is moving away from finding cases and moving towards preventing them in the first place.
The 2012 National Retail Security Survey pegs shrink at $34.5 billion annually. About 44 percent of that shrink was directly attributed to internal theft. There are many concepts that exist to explain why such a large percentage of loss is attributed to internal theft. One of the most popular concepts is the theory of escalation. This theory says that an employee who steals will, over time, steal more often and take more valuable assets. We conducted a study to confirm this theory.
Operational shrink, including losses caused by systemic issues and poor promotion execution, is more common and costly than fraud. However, many loss prevention solutions are unable to identify these hidden issues, and as a result, retailers do not realize the full extent of losses taking place that are not fraud-related and that are significantly impacting their bottom lines. To identify operational shrink quickly and before they cause substantial losses, retailers require solutions that: enable them to efficiently investigate every irregularity, provide both data and corresponding video, and deliver data in real-time.