EDITORS NOTE: Scott Ziter is director of asset protection for Price Chopper Supermarkets based in Schenectady, New York. He began his career as a store detective with Stop & Shop where he rose through the organization to director of asset protection and then vice president of asset protection for Stop & Shops parent company, Ahold USA. Ziter is chairman of the Food Marketing Institutes asset protection council and a member of the board of advisors for the Loss Prevention Research Council and the National Anti-Organized Retail Crime Association.
EDITOR: For those who may not be familiar with Price Chopper, give us a bit of background about the business.
ZITER: The company is owned by the Golub family. It was founded in 1932 and is in its third generation. Our current executive chairman of the board is Neil Golub, and several other family members also work in the company. Jerry Golub is the vice chairman of the board, Mona Golub is the vice president of public relations and consumer services, and Jane Golub is the director of in-store marketing programs. We have the first non-family member CEO right nowScott Grimmett.
EDITOR: How many stores do you have?
ZITER: There are 137 stores in New York, Pennsylvania, Vermont, New Hampshire, Massachusetts, and Connecticut. Our largest market share is in the New York state capital district area, with our corporate headquarters in Schenectady, New York. Our company introduced a new brand called Market 32 in early 2015. We currently have eleven Market 32s, and the plan is to convert the entire chain over the next several years.
EDITOR: Tell us how you first started in retail loss prevention.
ZITER: After high school in 1990, I attended Westfield State Collegenow known as Westfield State Universitywith a passion to pursue criminal justice. My heart was set on working in law enforcement. During college, I declared a double major of criminal justice and psychology and became more interested in counseling in the correctional setting. I worked myself through college and was hired as a store detective at Stop & Shop in Pittsfield, Massachusetts. When I graduated in 1994, I stayed with Stop & Shop and shortly after was offered a loss prevention field manager role in Connecticut.
EDITOR: For the benefit of all of the young people out there, do you recall how much money you made starting as a store detective?
ZITER: I made $7.00 an hour. I was an overnight detective when I started, so that gave me premium pay.
EDITOR: What caused you to change your mind and stay in retail as opposed to pursuing a career with law enforcement or counseling?
ZITER: I really enjoyed working in the supermarket environment. I also had some mentors in the past who said that you could go much further in the private sector. When I became a loss prevention field manager, at the same time I was a finalist for a crisis counselor position in the Berkshire County House of Correction (Massachusetts). The sheriff asked me why I wanted to leave Stop & Shop for a job in the public sector. I took that conversation and made a decision that it would be in my best interest to continue a career in loss prevention, which has led me to where I am today.
EDITOR: You have accomplished something that not many people can say that theyve done, and that is you went from store detective to director with the same company. Thats quite a feat. How did that happen?
ZITER: From the beginning of my career, I was viewed as a strong business partner. I always had a very good connection with field and distribution leadership to align the loss prevention departments objectives with those of the business. I was respected by the leaders, not just in the loss prevention department, but also in operations, merchandising, and elsewhere in the organization. The main objective for my team was to help our organization increase sales and profitability while reducing its exposure to risk and loss.
EDITOR: After 21 years with Stop & Shop, Ahold pried you away. How did they do it?
ZITER: Ahold USA is the parent company of Stop & Shop, Giant of Maryland, and Giant of Carlisle. In late 2011, the vice president for asset protection at Ahold USA, Nancy Jones, announced her retirement. I saw an opportunity to bring what made me successful at Stop & Shop to the other divisions in Ahold USA. After nine interviews with executives from Ahold USA and its division presidents, I was offered the position in May 2012.
EDITOR: And youve been at Price Chopper for how long?
ZITER: In 2014, I learned that the director of loss prevention position at Golub Corporation/Price Chopper Supermarkets was open. After careful consideration, I decided to make a change in my professional career. I also saw an opportunity to help grow and expand on some of the existing programs and implement new initiatives at Price Chopper. Ive been with the company for two-and-a half years, and my responsibilities include shrink management, investigations, analytics, corporate security, crisis management, and the field audit functions, which include cash and pharmacy audits.
EDITOR: Does asset protection have responsibility for pharmacy shrink?
ZITER: Asset protection does not have direct responsibility for pharmacy shrink. There are pharmacy-specific specialists who deal with the inventory process. However, asset protection is responsible for pharmacy diversion, and thats done through my analytics team led by Jodi Musto, utilizing Supplylogix. Asset protection partners with pharmacy leadership on all prescription-related investigations.
EDITOR: When many of us think of grocery, one of the big things that stands out as a difference between it and other sectors of retail is spoilage and waste. How is that accounted for in the shrink equation?
ZITER: Damages and out of codes is what we scan out and is considered our known shrink. In addition to our perpetual inventory cycle counts, weve put an increased focus on known shrink as it represents roughly 40 percent of our center store shrinkgrocery, frozen, and dairy. The dairy department accounts for a significant piece of our known shrink at Price Chopper. The main causes of dairy shrink are ordering practices and rotation. Were working with the stores to address things that are in their control. Computer-generated ordering (CGO) is one area that we know is key to successful ordering. One of the problems with CGO in our industry is that there are always some individuals that dont trust the system and fail to make the correct adjustments to their orders. This leads to an increase in out of codes and additional shrink.
Fresh shrink continues to be a concern for many retailers. At Price Chopper, we place a greater emphasis on fresh shrink as it accounts for approximately 75 percent of a stores total shrink result. Our store team leaders conduct period fresh-shrink inventories. As mentioned about dairy shrink, a significant amount of fresh shrink is due to damages and out of code product. Proper ordering and rotation is important in fresh departments as well. Among other reports, the asset protection shrink analyst provides a period shrink performance report. The zone shrink specialists use this report to address the departments that need additional attention.
EDITOR: Since your arrival at Price Chopper, what are the things that you and your team are most proud of accomplishing?
ZITER: One of our accomplishments is the department restructure that took place in early 2015. Our teams focus is now balanced between inventory shrink reduction and the traditional, but necessary, asset protection functions such as investigations, corporate security, and analytics.
Were also placing emphasis on developing a best-in-class crisis management program. Mike Gulli, manager of crisis management and corporate security, has taken the lead on this initiative. The most important piece to the initial success was the buy-in and support from our executive leadership team.
Weve also put a lot of effort into building a successful partnership with store operations, to the point where senior leadership has commented that its the best theyve seen during their time at Price Chopper. The asset protection leadership team has taken pride in building a team that is truly aligned with other business colleagues.
EDITOR: What steps have you taken to strengthen the relationship between your department and store-line associates and operations people?
ZITER: From the moment I got here, I made it very clear that the success of our department depends on what we provide for support to the business. My focus has been and continues to be that my team will partner with the business to increase sales and profitability while reducing our exposure to risk and loss.
One of the first opportunities I observed was to re-align our field structure to place more emphasis on both center store and fresh shrink. An important change was redeploying existing resources to provide a shrink specialist in each zone. The zone shrink specialists report to an asset protection field manager, but they partner every day with their zones director of operations and product specialists. Asset protection is now better aligned with the objectives of the operational team. The director of shrink initiatives and I work cohesively on corporate shrink controls and objectives. What helps strengthen our relationship is that asset protection reports into operations.
EDITOR: Do operations people in the store, whether they are the store manager or store associates, have any role to play in theft prevention?
ZITER: Thats sometimes a debated questionshould they or should they not be involved? We at Price Chopper prefer a hands-off approach when it comes to store personnel apprehending shoplifters. We ask our store management team to utilize customer service skills to deter potential shoplifters. We ask them to document as much information as possible about the incident and report it to their asset protection manager.
We utilize a process called cycle count discrepancy for department team leads to use to report if there are discrepancies between shelf stock and CGO for high-theft SKUs. These reports are electronically sent to asset protection managers and quickly investigated using CCTV recorded video. AP managers build cases from the data and present to law enforcement. This program allows asset protection to utilize resources more efficiently and has also increased store level awareness. Law enforcement has identified or arrested 40 percent of reported cases through cycle count discrepancies.
We have implemented in one zone a direct store delivery (DSD) discrepancy report that tracks DSD vendors who have quantity discrepancies in their deliveries. This program helps bring attention to the DSD receivers and the merchandising team those vendors who provide poor delivery service. Initial findings showed that approximately 13 percent of all deliveries had errors.
EDITOR: You mentioned crisis management a few moments ago. Talk a little bit about what that means at Price Chopper and how you go about protecting the company.
ZITER: As mentioned earlier, our executive leadership team takes crisis management very seriously. We view crisis management as a three-step programemergency response, business interruption, and business continuity.
In my opinion, we are very strong in the emergency response area. Weve implemented a workplace violence program where all associates are required to complete a computer-based training (CBT) module. We also have a threat response team made up of individuals from asset protection, legal, human resources, and safety. This group reviews all threat intake reports and collectively discusses what steps should be taken to address the situation at hand.
Our company does a good job in the area of business interruption. We classify a major storm in our operating area as a business interruption event. Our manager of crisis management and corporate security engages the business interruption team and provides necessary updates in a timely manner. Conference calls and other forms of communication occur throughout the event as well.
Were continuing to work on the third stepbusiness continuity. Asset protection partnered with a crisis management consultant, Ripcord, to help us build a business-continuity (BC) charter and a three-year road map. An important piece of our BC plan has been getting all individual department leads together to build a business impact analysis for their area. The ultimate goal is to have all plans in a central repository. Ripcord has also assisted us with building a CBT module, which will be rolled out to our teammates in 2017.
EDITOR: What are the challenges of organized retail crime (ORC) within Price Chopper? Are there any particular things that you do to deal with this?
ZITER: Just like my AP/LP colleagues, we have to contend with ORC in our operating area as well. During our department restructure, I included a position that reports directly to me, which is the corporate investigations and ORC specialist. Danielle Gunville was hired for the position in November 2015. We have asset protection investigation specialists in each region and Danielle works with them, building on the cases that are occurring in their respective areas. Right now we have a significant case (over $200,000) that Danielle is working on with the United States Secret Service and New York State Police investigatorsa major credit card fraud scheme that was hitting across our operating area.
For the corporate investigations and ORC specialist, its very important to have a close relationship with law enforcement and our asset protection field team and a very tight relationship with other retailers across our operating area. My team attends the New England ORC conference in Worcester, Massachusetts, every year. Danielle is part of many trade associations throughout the industry because we think working with other retailers is extremely important in combatting organized retail crime.
EDITOR: Are there particular food products that tend to be more common to the ORC offenders?
ZITER: Red Bull is a big target. The energy drink market in general is targeted fairly heavily, but especially Red Bull. Also baby formula, razor blades, dental care, and national brand laundry detergent to name a few. When it comes to ORC, I also include gift cardsthe iTunes, Amazon, MasterCard, and Visa gift cards are hot items that are frequently purchased with fraudulent credit cards.
EDITOR: Have you rolled out any technology solutions to address the ORC and other issues?
ZITER: My team has implemented several successful technology initiatives. To start with, Price Chopper was recognized prior to me joining the team as one of the companies to deploy network video management across the chain. Our company is fully rolled out with both IP and analog cameras. All camera systems throughout the chain are accessible from any location. Having this strategy has allowed asset protection to implement programs and integrate other technologies to help combat ORC and other issues.
Were working with Tally Solutions testing a new technology called Smart Shelf. We have Smart Shelf deployed in over twenty stores focusing on energy drinks. If the system senses sweeping of product, it will send a real-time email alert with video attached to asset protection and initiate a [public address] announcement at the store stating, Customer service needed at energy drinks. The technology can also send out-of-stock alerts to store personnel and distributors. So far the system has been very successful in deterring far more events then actual theft. The plan is to install this technology in another ten stores next fiscal year.
Were exploring facial recognition for access control purposes in our main office using a company called FST Biometrics. The technology is also used for access into our data center. Potential future uses for facial recognition is to identify known ORC suspects as they enter the store, forcing real-time alerts to asset protection personnel.
Our asset protection and marketing teams have partnered with a company called Cognimatics to develop a customer traffic flow analysis in our Market 32 stores. This solution, if successful, will provide synergies between departments utilizing current camera systems.
EDITOR: Lets change the subject a bit. You are involved with the Food Marketing Institute (FMI) Asset Protection Council I believe. You have a conference coming up in March. Is that correct?
ZITER: Yes, the upcoming FMI event has been renamed the ASAP Conference, which simply stands for the three focus areas of the conferenceaudit, safety, and asset protection. It will be held March 20th through 22nd at the Rosen Shingle Creek Hotel in Orlando, Florida.
EDITOR: What are some of the topics one can hear at the conference?
ZITER: The asset protection track will include sessions such as building a crisis management plan, fresh shrink, credit card fraud schemes, supply chain and corporate facility security, and emerging CCTV and facial recognition technologies. Wicklander-Zulawski will be doing an advanced session on corporate fraud and high-level investigations.
The risk and safety track will include sessions on driving a safety culture, OSHA compliance issues, ergonomics, and fire safety.
Topics in the internal audit track will include ten reasons controls break down and what to do about it, better consulting skills for auditors, payment card industry (PCI) compliance, and Food Safety Modernization Act (FSMA) compliance.
EDITOR: Youve occupied every position from ground level up to director. How do you go about helping the people in your organization get better at what they do?
ZITER: Im on the board of advisors for the Loss Prevention Research Council (LPRC). All of my direct reports, as well as some of their people, participate in one or more of the LPRC working groups or action teams.
I encourage asset protection teammates to be part of local organizations in their areas, whether its a food association or a retail coalition of one of the states where we operate. I believe cross-functional training is important. So for example, if operations is doing any type of training like a pre-holiday model store presentation, all asset protection teammates will attend in their assigned areas. I visit stores with my colleagues from other areas of the business, and I ask the same of my direct reports and their teams to be able to get a different perspective of a store walk.
I think theres so much value that one can take from the education and professional development sessions at an event such as FMI, National Retail Federation, or Retail Industry Leaders Association.
Ive pushed associates to take advantage of the companys tuition reimbursement program as a college degree will definitely help someone advance in their career. One of the most important ways to help others grow and develop is to be the best mentor possible.
EDITOR: Speaking of mentors, over the years as youve grown in the business yourself, has there been a particular person who you look back on as being instrumental in getting you to where you are now in your career?
ZITER: Absolutely. The first person who comes to mind is someone Ive known since 1996 when I worked at Stop & Shop. His name is Ron Onorato. Hes currently the president and chief operating officer at Inserra Supermarkets, a co-op of Wakefern. Ron rose through the ranks to division president at Stop & Shop. From the time I was a division loss prevention manager in Connecticut, I worked closely with Ron to help increase my knowledge in different areas of the supermarket business, including operations, human resources, and merchandising. I have always thought of Ron as a mentor and someone whom I can pick up the phone to call to this day for his guidance and support.
EDITOR: Are there particular loss prevention leaders whose opinions you value and who you might call on for advice and counsel?
ZITER: Definitely. Kathleen Smith, VP of asset protection at Albertsons/Safeway. Ive known Kathleen for almost ten years as weve served on the FMI Asset Protection Council together. Shes someone whom I talk with on a regular basis and is a true leader in our industry. Her commitment and dedication to our field is second to none. Overall, Kathleen is someone who provides guidance and support regardless if youre a colleague of hers or someone new in the industry.
For more information about the FMI ASAP Conference scheduled for March 2022 in Orlando, FL, visit the Events page.