Australian Retailers Are Working Together to Defeat Shrink

Australian retailers

Australia is famously referred to in a Men at Work song as the “land down under, where women glow and men plunder,” which according to experts was a reference to the country’s mining industry and the exploitation of natural resources from this vast, mineral-rich country. However, another reading of the lyric is “to steal” as the country was once the final destination for swathes of transported thieves from the UK in the eighteenth and nineteenth centuries.

Reputationally, Australia has long ditched the Botany Bay legacy to become a land of great opportunity for hard-working immigrants looking for a new life down under. It is a largely meritocratic country where hard work is rewarded, glass ceilings are shattered, and anyone can achieve higher in this brave new world. Now Australian retailers are further turning that stereotyped notion on its head by showing the rest of the world how they work together to defeat high levels of crime both in their stores and online.

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Candor and Can-Do

There are no magic wands or silver bullets to make shrink disappear, but the nearest thing to witchcraft is the new and almost insatiable desire for retailers to collaborate. In the UK, it has taken more than a decade for retailers to break down many of the commercial barriers and to “dare to share” non-competitive risk data. But in Australia, it has taken just over a year to establish and expand the Profit Protection Future Forum (PPFF), which already boasts around eighty national retail members.

Its rapid growth is largely due to candor and a can-do approach that is part of the national psyche. This honesty and straightforwardness means that members define and agree to their own agenda in a no-holds-barred forum and come together twice a year to share best practices and intelligence in a bid to defeat a growing threat.

According to the 2016 Global Retail Theft Barometer, shrink has fallen four percentage points in real terms and 0.21 points lower than the global average. This could be down in part to a more proactive approach from law enforcement that has targeted retail crime in the last twelve months. Police in Sydney arrested 77 offenders and recovered goods worth $6,000 as part of the initiative. The Australian Retailers Association has also suggested that its members add 3 percent to the price of goods to help them recoup the overall cost of retail theft.

With a population of just 24 million across one of the world’s largest land masses, crime is largely concentrated in the urban centers close to the coasts and predominantly in the southeast of the country. Such concentrations of population can be seen as a driver for crime, and it is possible to extrapolate a potential rise in crime in line with projected population growth; the country is expected to be home to 30 million people by 2030.

Most of the growth will be in the established centers, as much of Australia’s heartland is sparsely inhabited bush and desert. The country has only three people per square kilometer of its total land mass. And almost 90 percent of the population lives in the towns and cities.

Neil Redfern is a retail security and loss prevention executive with 22 years of industry experience working for Myer, Australia’s largest department store chain, and more recently as the national loss prevention and sales and compliance manager for Optus, Australia’s second-largest telecommunications provider.

Redfern, who sits on the steering committee of the PPFF, has occupied various specialist and managerial positions and through his collaboration with Professor Adrian Beck of the University of Leicester and the ECR Community’s Shrinkage and On-shelf Availability Group has gained comprehensive knowledge of total retail loss strategies.

He has personally seen all aspects of shrink in his two contrasting roles: “In my previous role, I was dealing with more property theft, but working in Australia’s second-largest telco, the emphasis is more upon fraud-related losses. However, the crime prevention strategies at both are largely similar—the backbone of crime management is the same.”

The PPFF was born out of the ECR Australia Group, supported by Checkpoint Systems. It was where Redfern had first met Professor Adrian Beck and Colin Peacock. He said it was clear from the meetings, which involved a number of retailers, that broader collaboration beyond the ECR was needed moving forward.

“There was very much a need in the Australian market for people to come together in the spirit of collaboration around non-competitive retail risk. We had to have a broader change of focus to look at larger retail risk topics affecting the Australian market—and beyond. We also did not want to be limited to what we could and should talk about, and retail risks are constantly evolving.

“We launched the PPFF in 2015, and we have had three meetings with between sixty and eighty LP representatives in attendance. But we were clear from the outset that this was not a place for suppliers to sell to us. They are welcome to attend to talk about issues related to the forum subjects, but we are not interested in pitches.” The forum is about education and awareness.

The Future of the Forum

Going forward, the meetings will be held twice a year in either Melbourne or Sydney (one of which is taking place on October 10), and costs will be shared among the group. “We want to be able to attract leading industry experts to attend and present and who would normally only be seen at large conferences and frankly could be out of the financial reach of our members,” said Redfern.

“It will remain free at present because we do not want to restrict anyone’s ability to collaborate and contribute in a non-competitive way to the group and to help bring a wider understanding. It helps us face the risks more prepared. We may have to evolve a paying structure as we move forward, but at the moment in pilot mode, we are funding it among ourselves.”

Themes that have emerged in the PPFF so far include the growth of cyber crime and the risks involved in new payment methods. “We also want to deliver some more intellectual and academic rigor to the discussions, and we are delighted to have Dr. Emmeline Taylor join the PPFF. She is the Australian equivalent of Professor Adrian Beck and understands the marketplace very well from the work that she has been doing at the ANU [Australian National University].”

Emmeline Taylor, PhD, a senior lecturer in the ANU’s School of Sociology, is an expert in retail crime, and her recent focus has been around surveillance technologies and crime control, understanding offender perspectives on police body-worn cameras and CCTV, and armed robbery in retail. She will assist the PPFF in its focus upon retail risk in cyber space, and other areas of focus will be self-checkout and law enforcement.

Redfern added, “It is very important that as a group we have the industry knowledge but also have some academic rigour around what we are talking about, so it is not simply anecdotal. The mix of knowledge and empirical evidence is powerful.

“The way we started the forum and Adrian’s piece around total retail loss brings together a wide range of risks—both traditional and non-traditional LP. We will also be looking closer at our members’ experience of RFID, fraud intelligence, data mining, resilience, and policing around the growing issue around international terrorism.

“There are so many new areas and challenges in the LP world, and they will have a massive impact in terms of potential brand damage. In terms of cyber, we are seeing a convergence between the worlds of LP and IT, and I am sure we will see calls for greater alignment between the two disciplines moving forward.”

The PPFF is a big idea for a big country with even bigger ambitions. Australia may be a land down under, but it has in the PPFF a straight-talking and can-do approach to dealing with retail crime. Commercial differences are left at the door, and pain-and-gain sharing (as well as workable solutions) provides the agenda and represents the order of the day.

This article was originally published in LP Magazine Europe in 2017 and was updated October 10, 2017.

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