Author: Greg Taylor

Business Finance: Tackle shoplifting

In his weekly business banking post Greater Building Society CFO Greg Taylor says shoplifting is a serious cost issue for business.  He shares some ideas to prevent shoplifting. 

One of the biggest obstacles to increasing profits, certainly in retail, is loss prevention. Shrinkage, shoplifting and employee theft are the three main areas for loss.

The British Centre for Retail Research estimates that Australia’s retailers lost more than $2 billion in 2011 from shrinkage. This is equal to 1.4 per cent of retail sales.

According to NSW Police shoplifting accounts for up to 40 per cent of reported shop losses each year.

Understanding who steals and why, is an important first step in preventing shoplifting.

Shoplifters come from all socio-economic backgrounds. Amateur shoplifters usually steal on impulse. A large part of that group is young people aged 10 to 18 years who steal to impress friends. Professional shoplifters are more likely to work in pairs or groups. They often steal to obtain a false refund for the items and have often ‘cased out’ a store before stealing.

Technology such as cameras and new radio frequency identification RFID tags for items can play a part in loss prevention but can be expensive for smaller retailers. Police suggest three practical areas on which to focus.

First, the way you design and layout your store can help to deter thieves.

Having a policy and procedure on loss prevention, including shoplifting is a must. You need everybody working together on this.

Taking your staff through the policy is part of the third loss prevention tool; educating and training your staff to be aware of the need to prevent loss or theft and how to do it.

As a matter of interest, the Crimes Act says that you may ‘arrest’ someone who is caught committing, or who has just committed an offence that is punishable under the law. If you detain a person who has committed an offence you must do it when or immediately after they commit the offence.

Sensibly Police warn “If the situation causes danger to you, your staff or customers do not try to detain the offender. The value of the goods can never exceed the value of your life.”

What do you do to counter shoplifting in your business? Please share your thoughts below. 

This post is based on Greg’s weekly column in the Newcastle and Lake Macquarie Post.