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How do you prevent shrinkage?

-- Gifts and Dec, 10/1/2008 12:00:00 AM

Linda Austin

Tesoro Mio

Coronado, CA

You can't prevent shrinkage. It's going to happen. What you can do is be on your toes, especially if the store is full of people. Luckily, my showroom is small, so I can see the whole store by standing in one spot. However, if I am busy with a client and my eyes are not on the showroom floor, that's when theft can happen. It has, but fortunately, I can count those incidents on the fingers of one hand. For 13 years in business, that's pretty good. I am lucky that the area I live in is small and, aside from summer visitors, most of my clients are neighbors and friends. Even the summer visitors usually come every year and fall into the same category: You know them and they know you. There have been several instances where I have been busy with a client and if the store is busy, one of the other customers will take it upon themselves to observe the others to make sure nothing is stolen. In the same vein, when friends come to visit me at the store, if I am busy they also will take up a watch. It's nice to know that others are looking out for your best interests. I haven't had many incidences of shoplifting for quite a while, but I think that has to do more with luck and having observant friends than anything else. If I ever have a larger shop, I would probably have to install cameras and other security measures.

Pam Hammond

Paddington Station

Ashland, OR

Shrinkage is tough because there are so many different types that happen in retail. Theft by customers is the hardest to track. Many of them are professionals, and my store is 9,000 square feet. Just this Spring we put in a 12 camera security system. Do I think we're going to catch a lot of thieves with it? No, but it is a way to go back and look at things afterwards. I tell all my employees to greet customers and make eye contact, which both provides good customer service and can prevent theft. As for employee theft, I carefully hand-select employees and we've had a lovely track record over the last 15 years of having people that I trust. Would I want to have these people over for dinner? If I can answer that truthfully I am probably making the right decision. We have constant conversations with our employees so they know our goals and that they are working for a good company. That's how we keep our employees on the straight and narrow. And then there's paperwork theft; orders that get processed wrong or paying for goods that you don't get. We have an excellent office manager and systems set up to make sure we know what we receive and that we get billed at the proper price, that there are no shortages that we don't track. We're not 100 percent perfect, but we try to keep all those balls in the air.

Debbie Dusenberry

Curious Sofa

Kansas City, KS

Our POS system helps a lot when it comes to keeping a lookout for actual cash being taken, as we can always tell if the sales do not balance.

Customer theft is kept to a minimum by my militant training of the staff to trust no one and never leave the counter unattended. (This is where we keep smaller, easily shoplifted items.) I am especially conscious of displays that can easily lead to theft and make sure to keep those situated in better view.

I feel that my staff is honest, but of course you can never know for sure. A larger employee discount can also help prevent inside theft.

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Retail shrinkage is a symptom of poor controls. Employee theft makes up the larger percentage....always has been, always will be. Your store may be different but despite hand picking your employees (doesn't everyone?) it will be there.

Audit your controls frequently to ensure your policies are being followed.

Patrick Murphy - 2008-11-22 19:10:00 EST

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