Controlling Retail Shrink in Stores with No Loss Prevention

Stores with no loss prevention staff present on a daily basis must use other tools and tactics to control shrink.

Fraud Statistics, stores with no loss prevention

A question frequently asked by the typical retail customer—and even some loss prevention professionals just getting started in their careers—involves many of the smaller stores where they shop, and how shoplifting and other retail shrink concerns are managed in retail stores with no loss prevention team.

First and foremost, few retail companies actually attempt to manage their stores with no loss prevention program. Considering the significant impact that retail shrink can have on the business, most retailers recognize the need to manage merchandise losses and protect all of the various assets of our retail stores. As a result, a loss prevention program often exists, but is managed in a different way than might be expected in a traditional department store setting, where resources are devoted to loss prevention personnel charged with identifying and apprehending shoplifters.

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Similar Expectations but Different Approaches

In many of the smaller, “specialty” stores, it may appear to the untrained eye that these retailers manage the stores with no loss prevention. However, most of these companies have programs in place that are intended to help manage merchandise theft and other losses. Often, the program is locally managed by loss prevention personnel who cover multiple store locations in the capacity of an area, district, or regional capacity. The focus of the loss prevention initiatives in these settings is placed on prevention and deterring theft and other incidents before they happen, rather than using store resources to actively attempt to apprehend shoplifters.

From an asset management standpoint, this will involve several different levels of deterrence. Physical security tools are often the first resource that comes to mind. This might include common tools such as locked showcases, security lanyards, and other physical security devices. Closed-circuit television (CCTV) technology can be used in many different forms and can be monitored both locally and remotely. Some types of CCTV can be accessed by a smartphone app and the touch of a finger.

Managing the various operational controls through the effective use of loss prevention audit programs is another important means of controlling retail shrink in these settings. Limiting opportunity is a prime factor in theft prevention, and stores that fail to run a tight ship in terms of these critical control measures are those that are most likely to have retail theft issues.

Most certainly, investigative measures play a significant role in controlling losses. Some companies might have loss prevention team members who cover multiple store locations dealing with shoplifting and related theft and fraud issues. Others will create task forces to handle other scenarios. Organized retail crime task forces may be created; these may even be collaborative efforts with law enforcement teams or other retailers. Software programs often come into play to help monitor point-of-sale transactions and other store functions. Covert surveillance operations are also a common tool. Critical skills, such as interview and interrogation techniques, play a much bigger role in program success.

But perhaps the most important skill for loss prevention professionals to possess in stores with no loss prevention staff present on a day-to-day basis is the ability to teach and train. Loss prevention professionals must reinforce the value of good customer service skills within the sales team. Associates must understand the critical role that this plays in deterring theft and controlling losses.

LP must also strive to increase store awareness of ongoing shrink issues and the latest shrink trends. By the same respect, a skilled loss prevention professional in this type of setting will be able to tie good loss prevention practices with all of the primary aspects of the retail setting: merchandising, operations, housekeeping and other related retail roles. The ability of the loss prevention team to carry business acumen and retail perspective and then apply those skills appropriately in the stores then becomes a badge of success, leading a program rather than simply supervising a team or executing a role.

Complement the Culture

Different types of retail require different types of management, and the loss prevention culture must be modified to best meet the needs of the business. It’s not simply a matter of the size of the building or the product being sold. It’s about the countless other factors that can and will influence the way that the business operates. One type of program isn’t necessarily better than any other. But they are different, and those differences should be our focus. Whether learning something for the first time or revisiting fundamental concepts of the business and the profession, all of us must adapt in order to remain relevant.

An education in retail loss prevention is an ongoing process, but in many ways, constants are just as important as change. The fact is, every successful retail organization must have an effective loss prevention culture to maintain that success. Some of the best loss prevention practices are invisible. Whether shopping in these stores or considering a career move in loss prevention, embracing that mindset might take your professional development in a new direction. It’s just as important to understand what we don’t see. That might ultimately change our perspective and a loss prevention career path.

This article was originally published in 2016 and was updated April 17, 2017. 

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