No one wants to believe their employees steal from them. Yet, employees do steal. They steal money, they steal products and they even steal time by having other employees clock them in and out.
A recent article in a Chain Store Age email commented on how theft is rising at retailing giant Wal-Mart. Wal-Mart stated it was due to shoplifting and employee theft among other things, accounting for a $3 Billion, yes, that’s billion with a “B” loss (or inventory shrinkage).
Ideally your shrink should be under 2%.
THE REAL-WORLD RETAILING TAKEAWAY
Get proactive about shrink — it’s your store and your inventory — and inventory should be treated like cash. After all, you have to pay for it.
So, how do you get proactive?
1. Conduct a bag check every time employees leave (for lunch, a break, to go home for the day). Just ask them to open up their backpack, purse, tote, etc. and take a peek inside. Once you give them the warning that you’re going to be conducting bag checks, that will eliminate one opportunity for theft.
2. Look for products in out of the way places — they are often hidden in corners, under boxes, etc. They aren’t there by coincidence. It’s part of the process of shuttling products toward the back door and then out in the trash.
3. Speaking of which…check the trash. You don’t have to dig through it. Just be more aware….
1. Have a manager on duty at all times – either the manager or the assistant should cover opens and closes seven days a week. That way you reduce the opportunity for line staff to clock in and out for each other when they’re not there – it’s one of the ways employees steal time.
2. Check “time cards” daily — sometimes employees don’t punch out for breaks but take them anyway (not only are they stealing time from you but legally a break is required every xx hours for hourly employees, potentially putting you in legal hot water if you’re ever audited).
1. The rule is to allow as few people as possible to handle cash — the fewer hands in the register, the less opportunity for “mistakes”. The same holds true when counting out at the end of the night and creating the deposit.
There’s no reason to jump off the deep end and assume all employees are thieves. But, companies don’t lose 2% of their inventory because it magically walks out the door itself. Customers steal too and we’ve all as employees made mistakes when scanning or keying in sku numbers into the register. All of those reasons are part of the equation for shrink. Just be aware — chances are if you’ve noticed something is amiss, it is — you owe it to yourself to get proactive and put measures in place to protect your investment.