The loss prevention budget is typically the smallest one in most retail organizations. This is especially true when it comes to acquiring technology. But what if you could somehow tap into the budgets of other departments to boost your loss prevention equipment budget?
What if other people in your organization could help you buy the loss prevention system that you are having a hard time getting approved by your C-level stakeholders?
Here is one example. The LP team from a nationwide retail chain purchased a video platform from my team. We tried to create the budget for the rest of the year, so they could acquire cameras and loss prevention equipment for more locations, but they were always capped at a certain point. “We can’t do anything more. The budget ran out.” We heard this often.
We then had the idea to leverage existing cameras to tie in retail analytics that could benefit other departments. Specifically, we brought in software that counts people, tracks footpaths within a store, and creates heat maps. It was a simple add-on to the existing video surveillance system, so the retail chain was able to expand capabilities beyond loss prevention. The new analytics were interesting to the marketing and operations departments, so they joined the project.
Marketing was interested in the analytics because they could now better understand consumer behavior. They could see in which direction customers were going as soon as they entered the store. They could also see the footpaths within the store and understand where customers spent the most time. This helped them place merchandise better, especially end caps, to capture more business.
Heat mapping also allowed marketing to understand which merchandise was being touched more. If an item was becoming popular, they could now pair it with a complementary product on the same display. In other words, they could up-sell and increase their revenue or saturate a popular store zone with the product that had the best margins.
Another benefit was that merchandisers could easily check for compliance. Did the store set up displays exactly as the merchandisers wanted? One retailer received displays from a manufacturer for that manufacturer’s products. If the displays were installed exactly as the manufacturer wanted, the retailer was reimbursed for the installation labor. Instead of having someone drive to ten different locations to check the displays, they were able to look up the video to see if everything was installed properly, take a screenshot, and send it to the manufacturer for reimbursement.
Operations appreciated the ability to properly analyze employee scheduling. The people counter could tell them exactly how much traffic they had for every hour of every day–not just for one store, but for entire regions. They could say, “Okay, at this location, we don’t need ten employees on this day. We only need six.” The operations team understood that if you can analyze the number of customers coming in at certain times, you could have more efficient scheduling and save money on payroll.
The end result for the LP team in this example was that for every four video systems that were purchased from the loss prevention equipment budget, they got one more for free bought from the budgets of marketing and operations. And they did this for three years. The return on investment (ROI) was there.
The company as a whole benefits from this approach, too. It buys one asset, and multiple departments get to use it. Talk about cost efficiency and asset optimization. This also helps unify common interests within the company and reduces complexity by having one platform that multiple departments understand and can use.
The bottom line is: with the help of other departments, LP can get the technology it needs to make its job easier. Involve other departments early; get them in the same meeting when technology is discussed. They will help you get the buy-in from the C-level and help you stretch your already-stretched budget.