In the retail industry, many issues needing security intervention are needed. Any hazard or criminal activity can lead to liability losses and can cause an organization to shutdown. To limit the chances of an incident from happening, an organization has to obtain the knowledge in several areas of the business. With a properly executed risk analysis and assessment, a company will have the knowledge and information needed to obtain a complete security and loss prevention plan. This essay will: (a) identify common hazards, (b) indentify common criminal activities, and (c) provide security recommendations to provide an efficient security program.
Hazards in Retail
Hazards are defined as an unavoidable danger or risk, even though often foreseeable or a chance of being injured or harmed. In the Retail Industry, a large array of risks to the operation is encountered. The global retail industry wired and wireless networks or equally confronted by a difficult threat with regard to new security possibilities. The absence of critical communication security divulge to criminals critical consumer data like charge and gift card information and the organization money
Supply chain interruptions emerge from a variety of sources. These particular hazards happen most often without warning. According to a National Retail Security Survey, retailers in the United States are losing approximately $31 billion dollars merely due to theft (University of Florida, 2001.) Company merchandise is lost through larceny, theft, a mixture of staffer theft, shoplifting, and dealer fraud. Retail thefts are not only an issue for the business but also affect the consumers as well in the response of higher prices. With the holidays coming up and thefts targeting hot selling items means there may be fewer of those items on the business shelves for the buyer to choose from. A detailed analysis administered by the University of Florida determined that retail security managers accredited more than 48.5% of their losses to employee theft, up from 46% the prior year. The thefts by those that work for the particular business can yield business owners a record $15 billion in merchandise losses (Holinger & Davis, 2002.) Another security threat in the retail business is the unfortunate practice of dealer fraud. Understood as "sold and unpaid" (SAU) or "sold out of trust" (SOT) cases, are happing more often and like other criminal acts hurt the unsuspecting customer.
Company violence is all destructive occurrences that happen in the workplace. These types of violent acts turn the work arena into a hostile atmosphere, which in turn can influence the employees' physically or psychologically (WorkCover NSW, 2002.) Violence stemming from the workers against fellow worker, the administrators against the workers and both administrators and workers against the consumers can happen within the workplace. These violent situations can come in a variety of ways like verbal and physical abuse, harassment, intimidation and threats to theft, stalking, assault, arson, taking hostages, and homicide. These events can place a considerable burden to the safety and general benefit of the administration, workers, and the consumers. When an institution clearly identified and addresses all hazards the organization continues to be profitable and the consumer can expect to pay fair wages for the merchandise purchased.
Criminal Activities in Retail
In today's society there are many elements that threaten retail businesses. Retail businesses are locations people shop in, enjoy restaurants, and take part in entertainment. Loss prevention is vital at these locations for protecting the people and their assets. Three major topics, shrinkage, human resources, and shoplifting, have been a large problem for retail businesses.
Shrinkage is the amount of merchandise that has disappeared through theft from being categorized as useless from breakage or spoilage or is unaccounted for due to sloppy records. In retail business the guidelines often blame the managers of the stores, departments, and loss prevention responsible for shrinkage. Hollinger and Langton (2005) discovered:
"The University of Florida noted for its National Retail Security Survey (NRSS), found that, in 2005 156 responding retail chains reported an average shrinkage of 1.59% of total annual sales. The rate in 1994 was 1.83 %. The shrinkage translates into $37.4 billion annual loss to retailers from a base of $2.334 trillion annual sales for the retail sector" (Â¶ 4)
Human resource is another problem in retail because retail loss prevention is highly dependent on the efforts of all employees, it is important that people understand the realities of human resources problems. This includes many part-time employees or temporary employees, inexperienced workers, and employees dissatisfied with the working conditions due to low pay and long hours. Loss can become a by-product of each of these personnel factors. For example, a part-time employee may be working during the holiday seasons to make some extra money and may be stealing to cover a gift expense. An inexperienced worker may be undercharging the customer during the purchase of the merchandise. Another example is an employee may have preformed a series of vindictive activities. Research by Langton and Hollinger of 103 retail companies, found that low-shrinkage retailers retain a significantly lower average percentage of part-time employees, a higher average percentage of full-time employees and substantially lower turnover than high-shrinkage retailers (Hollinger & Langton, 2005.)
Shoplifting has cost American retailers about 12 billion in 2005 and is one-third of shrinkage (Hollinger & Langton, 2005.) To deal with this serious problem, loss prevention practitioners need to have an understanding of the type of shoplifters. The ages of shoplifters are generally juveniles, referred to as snitches, which represent the majority of shoplifters.
Types of Shoplifters
Easy-access shoplifters are neither retail company employees nor customers. Because of their work, they have easy access to the retail merchandise. They can be delivery personnel, salespeople, or repair personnel. These individuals are also considered vendors when reporting theft.
The drunken shoplifters usually shoplift liquor, food, and clothing for personal use. The main purpose is to get merchandise that can sell to help get money for more alcohol. The drunken shoplifter is usually under the influence and never recalls the activity until sober and in full mind and body.
Addict shoplifters are extremely dangerous because due to the addiction to drugs and will do whatever it takes to get the ability to afford more drugs. Addict shoplifters are known for grabbing the merchandise and running. Most will sell the stolen merchandise for less than what it's true value is. Usually it is in the amount that is required for what they need.
Professional shoplifters account for a small percentage of shoplifting. A professional shoplifter's motive is for profit or resale of the shoplifted merchandise. Professionals usually go for merchandise that is very valuable or is on the market for a high dollar bidder.
Kleptomania is a rare, persistent, neurotic impulse to steal. Kleptomaniacs usually shoplift just because the opportunity is there. The value of the merchandise has no significance to the kleptomaniac. Kleptomaniacs will steal at any time and no matter who is watching.
Recommendations for Security
Security is considered the frontline defense to the retail industry against the criminal activities and hazards through a combination of security elements (Ortmeier, 2009.) The security elements range from intricate camera systems to specialized packaging. Several important elements for physical security measures are to be taken into consideration.
Loss Prevention Department
All Major retail outlets should have a dedicated loss prevention staff. These employees are individuals with specialized training in loss prevention and unknown to the employees or guest depending on the situation. This training is from observation techniques to apprehension of a suspect. The recommendation is to include several in plain clothing and several easily identified by either a yellow uniform or even a security uniform. The recommendation is to even make some associates, such as cashiers and stock clerks, part of the loss prevention team for catching any form of employee theft.
Any retail establishment's security is not complete without electronic surveillance cameras recording areas not visible to the employees. For a high deterrence effect, cameras are to be mounted and displayed in plain view. The monitors should also be displayed at the front of the store and also in a secured office for loss prevention reasons and to increase the deterrence factor. For a more discreet and hidden purpose, cameras should be hidden inside dark plastic bubbles with a pan-tilt-zoom camera inside that a loss prevention agent would control. Another option for cameras in the retail industry is for employee theft in the stocking and loading docks. The Purchase of camera systems should be with contractors, or sources such as Target and Walmart for inexpensive but very reliable camera systems.
The use of convex mirrors will assist in eliminating blind areas in the corners of the establishment. An employee can use these mirrors to monitor a suspicious person in a corner of the store from a distance. Flat angled mirrors placed along the top of the walls will allow employees to monitor customers at merchandise racks placed along the store's walls and can view the entire isles from a distance.
Electronic Article Surveillance
Electronic surveillance is a must for any retail organization with products. This uses small micro chipped tags on merchandise before it is sold and contains an item number in a computer system for inventory theft protection. These tags are displayed outside or concealed within the merchandise, work with a set of tall sensors or readers placed at the entrances and exits of the establishment. The cashier would scan the merchandise or remove the device with a special scanner or magnetic pad to deactivate or remove the tag. When the tag passes through the sensors without deactivation, it triggers an alarm and alerts the employees and security.
The use of ink tags are mainly for clothing items. An ink tag is a plastic contraption filled with ink used to stain the item when an attempt to remove it from the article. This tag is removed by an employee by using a special tool. This use of the ink tag is for deterrence to shoplifters and, if stolen, a release of staining die is activated by breaking a glass capsule when the thief attempts to remove it. This die renders the clothing unusable.
Special packaging is to deter the thefts of CDs, DVDs, and other media products. Many Retail establishments are placing the items in a large plastic frame making it almost impossible to conceal. To remove the item, a special key is used at the cashier register upon sale.
A full training program in the area of security should be established and maintained by the managers of the organization. This training should provide the policies and procedures for all the security issues of concern to the retail establishment. It should cover hazards, criminal activities, physical, personnel, and informational security awareness. Without proper training, an organization can become liable for any incidents that happen and a major loss financially can result. All organization should maintain multiple courses in educating the employees. An organization should also provide an incentive for accomplishing the security goals to promote the importance.
In conclusion, the retail industry will continue to face massive losses caused from internal and external thefts, violence, accidents, and organized retail crime for many years to come. The amount of security deterrence applications that a retail store puts into effect will determine the severity of the losses. With a proper security risk assessment and analysis performed, an organization will understand the amount of hazards and criminal activities along with having the knowledge to make recommendations needed to limit the amount of incidents or accidents within the organization. Thus will not have a security plan efficient enough to limit the amount of liability and may find itself in a major dilemma in the organizations' future.
Holinger, R. C., & Davis, J. L. (2002). 2001 National Retail Security Survey (Final Report). Gainesville, FL: University of Florida, Department of Sociology and Center for Studies in Criminology and Law.