Automated Incident Reporting Transforms Loss Prevention

Incident reporting is the cornerstone of effective communication and related analysis and actions to protect customers, employees and assets. An incident reporting program creates a communications ecosystems supporting collaboration, early detection, and the feeling of connection to the wider organization among the stores and local offices. Facilitating communication and connection using an effective incident reporting program is a critical element to leveraging compliance.

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Employment Screening and Loss Prevention

There are many types of employment screening tests. The tests that are targeted at personality, integrity and ethics are most beneficial to reducing actual theft and unproductive behavior (i.e., theft of time). Given a thoughtful approach that addresses all the ethical concerns about testing and informs candidates in advance of the required tests, these tests help companies leverage compliance.

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What You May Not Know About Criminal Background Checks

Criminal background checks should be used for certain employment positions at every company. These positions should include senior management, those w/ access to significant cash or assets and those in a work location where an employee could present a difficult to manage danger to other employees (e.g., a remote location). To make the best use of background checks a company needs to define a policy, consider situations that may arise and develop procedures for such situations (e.g., paragraph 2 above), define which employment positions require a background check, and administer the checks consistently and without bias.

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Store Self-Audits an Integral Part of Loss Prevention

An effective loss prevention function requires a well-designed program of policy and procedures, effective training to communicate not only the “what” stores must do but, more importantly, the “why” or purpose of the procedures, a self-audit designed to validate that the highest priority procedures are consistency executed, and periodic performance of the self-audit by an independent function (e.g., loss prevention, store operations, internal audit).

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The Argument for Analyzing Physical Inventory Results

My experience with physical inventories is that most companies are so relieved that the physical inventory is complete, they just wipe their brow and move on to other things. Sure they calculate the inventory shrink results, double-check large discrepancies to identify possible counting errors, and create follow-up plans for locations with poor results; however, truly analyzing the results to identify opportunities for process improvement rarely occurs. This is a mistake.

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Leveraging Alarm System Reporting for Asset Protection

Virtually all companies implement alarm systems in all of their locations. In the vast majority of these cases the purpose is intruder detection and notification to security employees and law enforcement of break-ins and related events. Most of these alarm systems provide a wealth of data regarding the times, dates, and employees that activated or deactivated the alarm. Utilizing this data within a robust asset protection program that requires incident reporting of alarm events and follow-up on alarm events that are not adequately explained by an incident report will not only mitigate the largest inventory shrink risk (off-hours internal theft) but also clearly demonstrates the company’s commitment to asset protection.

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Using On-hand Inventory for Predictive Analytics (Predictive Analytics for Loss Prevention Series)

The transaction activity and on-hand inventory that is available from retail perpetual inventory systems provides a wealth of information. While some retailers apply robust analysis tools, techniques and procedures to this data, many small to medium-sized entities (SMEs) do not. The flow of products through your store or your distribution center (DC) is the lifeblood of your business. A well-run business leverages this information to identify issues and drive success.

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LP Cycle Counts Part 3 (Predictive Analytics for Loss Prevention Series)

In parts 1 & 2 of LP Cycle Counts we outlined the components of a robust program and the advantages of an analytic-based LP cycle counts over a cycle count for inventory adjustment program. The discipline applied to timely analysis of the LP cycle count results and follow-up for outliers is critical. The whole point of the program is to take appropriate action for the few locations that have issues, and leave the others to continue their excellent work uninterrupted. An effective program becomes a “lens” to focus your management and oversight resources on issues before they mushroom into huge losses.

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LP Cycle Counts Part 2 (Predictive Analytics for Loss Prevention Series)

In Part 1 of LP Cycle Counts I described a robust program and the related benefits. The cornerstone of the LP program is cycle counts of all units in a Product Category and comparison to the units per the perpetual inventory system. Over the years since program implementation and despite the success, several operational or financial managers have asked why we do not support making adjustments to inventory based on this program. There are many reasons why inventory adjustments cannot be recorded based on the LP program and why implementing a program with the rigor to support inventory adjustments is not operationally or cost beneficial.

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LP Cycle Counts Part 1 (Predictive Analytics for Loss Prevention Series)

Requirements of a Robust Cycle Count Program

Loss Prevention (LP) cycle counts are quick counts of all the units of a product category/class/department in a retail store. This unit count is then compared to the total units on-hand per the perpetual inventory system and a shrink (in units) percentage is calculated.

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