Black Friday has become a key date for shoppers across the country. Named in the US, to describe the heavy pedestrian and vehicle traffic on the day after Thanksgiving, UK retailers have jumped on the opportunity to sell ahead of the traditional Christmas shopping period. However, with shoplifting, in some areas of the country increasing by up to 33 percent compared with November 2013, stores are not having it all their own way, Russell Holland, pictured, Global Account Director at Checkpoint Systems, writes.
Last year, UK retailers undoubtedly saw the benefits that Black Friday can bring, with unprecedented numbers of customers entering stores on the fourth Friday of November. Indeed, sales on the day were 21 percent higher than the previous year, and John Lewis was just one of the many retailers that saw huge increases, reporting its biggest trading week on record, with sales up 22 percent on the previous year.
However, despite the many reported successes, it was certainly not all plain sailing for retailers. The devil is in the detail and Black Friday is a double-edged sword. Competition on the high street is at an all-time high, and to get shoppers through their doors, stores resulted to undercutting one another with heavily discount goods. While, on the face of it, this presents scenes of jubilation when footfall increases, the accountants behind the scenes are less enthusiastic, as profit margins are squeezed even more than usual.
What’s more, television news, the national and regional media were awash with stories of a crime spree taking hold across the UK – public order offences increased by almost a quarter in November 2014 compared to the previous year. Scenes of people running out of stores with stolen TVs, fights on the shop floor and elderly people being knocked over by stampeding shoppers, did nothing to enhance the reputations of some leading grocery and electrical stores.
Make the most of the opportunities, but beware of the pitfalls
It goes without saying, the day presents a great opportunity for retailers to get more shoppers through their doors, on what would otherwise be a quiet day – last year, Barclaycard reported a four-fold increase in electronics spending alone. However, when profit margins become increasingly small and a threat of shoplifting, from a minority of dishonest shoppers, looms large, alarm bells should start ringing.
When we analysed police crime figures from November 2014, we were amazed to see that some areas of the country had seen shoplifting increase by more than a fifth, when compared against the previous November. In London alone, the Metropolitan Police dealt with 3530 incidents of shoplifting, almost 400 more than last year, and 3174 reports of public order offences – an increase of 920 on the year before.
What’s more, retailers were dealt a double blow, with incidents of shoplifting up 6.5 percent nationwide in December 2014. Worryingly, the reality is that the increases are likely to be much higher, as not all incidents would have been identified or reported by stores. It’s clear that some retailers were not only underprepared for huge increases in footfall, they had perhaps underestimated how many opportunistic shoplifters would grace stores up and down the country. Greater Manchester Police, for instance, reported that large supermarkets in the region made significant demands on policing because of shoplifting and anti-social behaviour, much of which could have been prevented.
Not only that, the increase in theft seen in December, could be attributed to dishonest shoppers ‘having another go’, and stores not identifying weak spots in their security following Black Friday
Preparing for the rush
According to Visa, consumers spent £1m on its cards every three minutes throughout Black Friday 2014. And as retailers across the country prepare to offer discounts of up to 70 percent, Tesco forecasts the day to beat this year’s Boxing Day sales. With that in mind, retailers need to ensure they’re fully prepared when 27 November comes around, otherwise we will see a repeat of last year’s chaotic scenes.
But what can retailers do to maximise their profits? Firstly, it’s about getting the balance right. Hiring-in dozens of security guards, to protect aisles, can turn some people off entering the store. Equally, locking all merchandise away in cabinets is proven to reduce sales, as consumers can’t interact with the products. In my opinion, it’s important for retailers to identify what items are most susceptible to theft and apply innovative security solutions to them, while at the same time ensuring that staff understand how to use existing loss prevention systems, such as electronic article surveillance tags and antennas.
Loss prevention measures are undoubtedly key to reducing shrinkage – a visible deterrent on easily concealable merchandise will significantly reduce the threat of it being shoplifted, while moving high-theft items away from the store entrance will help overcome opportunistic theft. But, as we saw last year, Black Friday presents a bigger problem than just customer theft. With highly stressed shoppers looking for great deals, better inventory control is an area that can help tackle one of last year’s biggest problems – customers fighting over the last item.
By improving inventory control, retailers can ensure that merchandise is available for sale, rather than the sitting in the back office or warehouse. This will help to increase sales, while potentially averting scenarios where customers become infuriated as they believe an item is out-of-stock, when in fact that is not the case.
Final thoughts
Failure to learn from last year will not only damage the bottom line, but it may have a longer lasting reputational damage. On top of that, it may also have a knock-on impact on festive trading. It goes without saying that if stock is unavailable because it has been stolen and stores are not monitoring their inventory, they will sell less come Boxing Day.
To sum up, Black Friday will provide an opportunity for retailers to increase their sales ahead of the traditional Christmas shopping period. But there is very little point in spending millions advertising Black Friday promotions if stock walks out of the door for free, or there is little merchandise on your shelves for people to buy. In the lead up to this year’s sales periods, it’s vital to look at all areas of your store and ensure loss prevention and security is top of the long term agenda, not only in November.
Tips
· Review your loss prevention systems and ensure that all staff have received training on using solutions. This will allow them to quickly respond to any incidents, while helping to protect merchandise on the shop floor.
· Inventory control is key to maximising sales and keeping customers happy. Review your processes ahead of Black Friday to ensure that you are prepared to keep merchandise on sale in the most efficient way possible.
· The use of stanchions, crowd control barriers, fences and signs painted on the ground to direct the crowd should help control the flow of customers into the store.
· Use people counters on the shop entrances to keep the employee to customer ratio to remain balanced. Ample staffing for the number of customers should leading to fewer incidents inside the store, quicker transaction times and a much smoother operation.
· Communication is key when addressing consumer expectations, talking to waiting crowds outside the store, so they know the entry procedure, the store policies (one per person/ taking items from other shoppers/attitudes towards staff). By setting boundaries early on, you are expressing what behaviour is acceptable and what is not.
