What do the loss prevention people at the UK’s number one retailer make of the likely recession? They’re not depressed but seeing it as a chance to re-focus on the right things, the British Retail Consortium crime conference heard.
Mandy Gooding, UK retail shrinkage and security operations manager, gave the example of 100g bars of chocolate and product protection – that is, not just about product tagging. If children are in stores before school, rather than replenishing the chocolate shelves in the night, why not do it between 8am and 9am, to deter children who may be tempted to steal? In other words, loss prevention need not be about spending lots of money; but staff should know what the high loss lines are. While Mandy Gooding did not give any (commercial sensitive) numbers, she did say that Tesco had weekly (not monthly) reporting of shrinkage.
She went on to speak of making life difficult for thieves; with good customer service, by staff being helpful and friendly, which includes the security guard on the door. (Tesco has two guarding contractors, Advance and Total, both at the BRC event on October 21.) As Mandy Gooding said, making eye contact with the potential thief, offering a shopping basket, tells the shopper that ‘I have seen you; you have seen me’. "Theives hate good customer service."
The recession does appear to be having an effect on shrinkage, as Mandy Gooding spoke of a change from shrinkage in desirable goods only – such as vodka and whisky – to such good plus essentials, such as cheese, baby milk, nappies, meat, tea and coffee. This may suggest that the theft is by (or for?) struggling families, but a suggestion from the floor was that some of the amounts of say cheese being stolen imply that the theft is for, say, a café rather than an individual wanting to make cheaper meals.
Also required, she said, was ‘buy-in from leaders’; that they have confidence in shrinkage data and that you can show how it affects other key performance indicators, such as waste. "We are experiencing difficult times and we are going to have increasing challenges; however, if we are clever and focused, don’t try to reinvent the wheel, we don’t do things differently, we just do things better; we have overcome a recession before and we will do again. Will the credit crunch affect our business; the answer is simply yes. However, can we do something to minimise the risk? Again, the answer is simply yes."
Nigel Kirkup, assistant vice-president loss prevention at clothing retailer TK Maxx, was the day’s final speaker. Organised crime is an established threat in the United States and Canada; and is growing in the UK, he warned.
He went through some of the threats: large-scale refund fraud, cheque and credit card, return of counterfeit merchandise; theft of goods in transit. That can lead to the stolen goods delivered to small retailers stocked with stolen cargo, even using the original tickets (and fixtures!?). or, criminals use counterfeit receipts using technology out of the back of a car, that can print the tickets within minutes of a member of the gang leaving a store. The aim; to gain much higher-value refunds. Organised criminals are selling such methods, ‘almost like a franchise’. Or, gangs steal merchandise and sell it through on-line auction sites. (Even, so Professional Security heard at the conference, counterfeit banknotes may be sold at a fraction of their face value, over auction websites.)
Such organised groups may work through local drug-dealing groups, in exchange for say places to stay. In North America, retailers and law enforcers are sharing data through the Law Enforcement Retail Partnership Network, LERPNet for short. The UK does not have an equivalent, but the Fashion Forum of clothes retailers is working on it. But, meanwhile UK retailers are each working in isolation and so cannot prove that the criminals are more than isolated one-offs. He ended by saying he would welcome hearing from other retailers, to act on organised retail crime, and through the BRC. Later during question and answer time, he spoke of how in the United States FBI agents are attached to retailers, because crime against retail is across state borders and hence a federal (FBI) affair, besides such crime funding other serious crime. This raised the issue that cropped up again and again at the conference; while police are doing good work at a local level, where is the law enforcement against crime crossing police force boundaries? What of the Serious Organised Crime Agency (SOCA, www.soca.gov.uk)?
The conference heard of how SOCA asks retailers to put organised crime on their risk register; but retailers need to know the seriousness of organised crime – from SOCA. But how to progress, if no-one is taking national responsibility for gathering data? Instead there are anecdotes as aired at the BRC conference of gangs organised enough for gang members to have no involvement in the retail crime, instead providing the technology for the frauds, and driving to stores the people who do the stealing, such people paid perhaps £300 a day. People leaving their homes on a Monday, travelling the country, staying in hotels, being tracked, even, by retailer’s loss software. But because of their targets, are police forces prepared to do anything outside their geographical area?
Winding up the data, event chairman Prof Martin Gill reminded the audience that organised crime is a massive issue in the US: "I suppose that puts us all on our guard; there is going to be a need not just for more information but better information. And for security people at the sharp end, to be more imaginative in their use of technology. The resources as a consequence may get less for you."
