According to figures issued by the British Retail Consortium (BRC), customer shop theft offences in Britain fell by just over a quarter (26%) during the 12 months to April this year. Those offences committed by employees dropped even more sharply – by 56%, in fact.
The BRC attributed the drop in retail shrinkage to improved policing and crime prevention measures, but is also at pains to point out the influence of economic stability – and therein lies the rub.
That the economic crisis may have provoked sharp financial practice is a topic much discussed, but only in recent weeks have we begun to realise the direct impact that a global recession may have in the retail environment in terms of illegal activity. As grocers resort to electronically tagging choice cuts of meat, the pressures faced by the retail sector are becoming increasingly clear.
The insolvency house Begbies Traynor recently suggested that 300 retailers face bankruptcy in the New Year. As retailers struggle, there’s likely to be an increase in the number of buildings left vacant, waiting for new occupiers or, indeed, to be sold. Though empty, these properties still represent a capital interest, and it’s in the owners’ best interests to take steps that will secure them and thus reduce the risk of devaluation, decay and vandalism.
While times will no doubt be tough, cutting expenditure on security could well prove a cut that would backfire.
Combating the increased threat
What, then, can retailers do to mitigate the risk of shrinkage in the face of an increased threat? Fundamentally, there must be a realisation of the fact that budgetary cuts on security would represent a false economy. Rather, there needs to be an intelligent approach, with ‘Best of Breed’ security methods employed. By following this approach, retailers can maximise the efficiency of their security solutions without increasing expenditure.
Clearly, technological advances have been made and play a vital role in the overall security package. Tagging systems have evolved apace, with retailers now offered a choice of RF tags, AM tags, specialist tags, detachers, deactivators and labels (to name but a few varieties). The market for CCTV equipment has also expanded beyond recognition, with advanced technologies now comfortably within the reach of independent retailers.
Beyond this, integrated alarm transmission systems (such as SLIPstream(TM), for example) now provide businesses with multi-channel digital alarm solutions across intruder, fire and critical alarms as well as building management systems. The high-tech way of combating retail shrinkage.
Retailers are increasingly using advanced analytics and statistical analysis to better the effectiveness of solutions provided. These include comprehensive resource-to-risk computer programmes. There are also inventory stock control and monitoring systems which analyse losses throughout the supply chain, providing statistics per store and region as well as marking peak periods for losses and attempted thefts.
The human factor in loss prevention
There can, though, be very little substitute for actual human presence, all the while supported by the most appropriate blend of technological solutions available. A loss prevention ‘culture’ should be instilled within team members, from staff screening and induction through to ongoing training and performance measurement.
In a 2006 report evaluating the problem of retail shrinkage, Tim Sleep – director of retail at Ernst and Young – described “attentive and alert store personnel” as the best deterrent to theft. It’s vital to encourage every member of staff’s participation in the loss prevention process. Expensive tagging systems are only effective if the personnel on site react to activations.
Covert security personnel can be used to regularly test the security measures in place, monitoring their robustness, along with staff’s adherence to the systems and meeting of customer service standards. While staff collusion in loss is disappointing, it can never be ruled out. With the safety of the public and employees in mind, officers blend in to their surroundings while on duty, discreetly studying customer and staff profiles. From this vantage they can monitor customers, staff and suppliers, dealing accordingly with offenders.
It is, of course, important to achieve a balance between an effective, visible presence and an intrusion upon the customer’s shopping experience. Nobody would advocate airport-style security on the High Street unless they were seeking to drive all retail online, but there’s very little to suggest that a visible security guarding presence need necessarily worsen the experience of a legitimate customer. In fact, the opposite can often be the case, as can be seen by the move towards providing ‘customer service officers’ able to offer assistance and guidance.
Choreographed criminality in vogue
It’s becoming increasingly apparent that retail crime is often part of a choreographed operation, with perpetrators sharing intelligence networks. Consequently, retailers themselves need to adopt similar networks to combat the problem, sharing information and strategies in order to develop a collective response.
In many respects the US leads the way here. The National Retail Federation and the Retail Industry Leaders’ Association have launched an online, password-protected National Crime Database that allows retailers to share information on thefts, detect patterns of criminality and pinpoint any incidents of organised crime. Retailers in the UK, though, are moving in a similar direction.
Retailers Against Crime Scotland provides an excellent example of organisations pooling information to identify organised groups. Working in partnership with the police, resources can be effectively targeted to prosecute criminal organisations. Operating to a similar pattern, Business Crime Reduction Partnerships – forged in association with the British Retail Consortium and Action Against Business Crime – serve as a framework for businesses across the UK to share information on a local level and take the fight to the thieves.
There are a number of successful, localised initiatives throughout the UK set up with crime and loss reduction in mind, although a more integrated, nationally-focused approach is key to developing intelligence further.
Clearly these partnerships encourage interaction not only between businesses themselves, but also with the police service and other relevant local and regional agencies. They’re a positive step. The greater the involvement in such schemes, the better the opportunity for relevant information to be shared and appropriate action to be taken.
New challenges begin to emerge
This proactive approach will be required sooner rather than later as the retail environment continues to change, throwing up new security challenges. As the economic downturn increases the likelihood of retail crime, there is also an evolution in the basic methods of transaction that are presenting new obstacles to loss prevention.
Research conducted last year for G4S Security Services (UK) found that, during the previous 12 months, 7% of British adults had cheated self-scan technology to avoid paying for goods. While ultimately freeing up budgets for other security concerns, that technology needs to be monitored and any necessary changes made.
Even current environmental concerns are having an impact on the retail sector in terms of security. For reasons of sustainability, stores are increasingly encouraging consumers to keep a ‘bag for life’ rather than taking new plastic ones from the checkout at each time of shopping. While the policy is admirable, it plainly presents a security challenge as it makes shoplifters less easily identifiable.
Methods put in place to tackle issues like this one will again require an effective combination of solutions.
Security guarding, though, clearly has an important role to play with experienced officers able to quickly assess a situation according to such variables as clothing, manner and general behaviour, as well as by checking physical indications that items have been sold including electronic tagging, ‘Sold’ stickers or tokens some retailers are using to hand to the security officer on the way out of the store.
Assaults on the rise
It is, in fact, a concerning shift in some shoppers’ behaviour and attitude that’s rendering the retail environment an increasingly volatile one. Research for G4S Security Services recently revealed that 1.6 million Britons have, in the past five years, verbally abused retail employees who they felt gave them poor customer service. Even more worryingly, 150,000 Britons reportedly believe they are justified in physically abusing a member of staff that they feel has given them poor levels of service.
The experiences of security officers mirror those findings. To date, this year our security officers operational in the retail sector have reported 42 incidents of assault with a weapon, with 88 incidents described as either a kick, punch, head butt or bite. There have been 54 reports of verbal abuse or threats. While these figures may seem small when set against a backdrop of over 900 officers, it’s often only the more serious incidents that are reported, with a certain level of activity often perceived as “part of the job”.
An awareness of such threats within the retail environment has prompted retail and security employers to equip their staff to deal with challenging situations. Partnerships with conflict management consultancies such as Maybo offer security officers and retail staff the training to develop their own conflict resolution skills and, ultimately, provide the best service and environment possible for the customer.
No cause for bleak resignation
The impacts of the financial crisis, shifting priorities and fundamental changes in the basic mechanisms of retail will all inevitably throw up new security challenges in the short, medium and longer terms. That, though, is no reason for bleak resignation among security managers and loss prevention directors.
The security solutions available are advancing at a pace at least equal to – and often better than – that at which the threats are developing. Both in terms of technology and in the training and quality of security officers, the resources available to the retail sector are now far advanced of where they stood a decade ago.
What’s required now is a readiness to adopt these new solutions, and integrate them intelligently within the traditional retail environment. Then we’ll begin to see some really positive outcomes.
*Douglas Greenwell is sales and marketing director at G4S Security Services (UK)