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Managing Loss in the Rent-to-Own Industry

EDITOR: Given you are not using a traditional shrink calculation, how do you know when loss prevention is winning?

TEMPLET: We still monitor, track, and work against our total loss line, which is a very important key indicator in our company. However, if you look at our financial results over the last couple of periods, we are running historically low total loss lines. Although many things factor into those results, our LP efforts over the last few years have had an impact. So, from a scorecard standpoint, we can see we’re getting payback for the investments that we’re making.

EDITOR: One of the added challenges that you have are the exposures that come with having stores in strip centers or free-standing stores in challenging neighborhoods. Talk about the problems associated with that.

- Digital Partner -

TEMPLET: The biggest challenge for us is burglary. We average more than one burglary a night every night throughout the country. And yet, that rate is significantly down over the last couple of years. Being in a strip-center environment and having product that people want, makes us a target. At the same time, shoplifting is not a big problem for us. But burglary remains a significant challenge that a lot of strip-center retailers have to deal with.

EDITOR: As a matter of fact, you participate in a group of retailers that shares information about the challenges of retailing in a strip-center environment. Talk about the nature and value of that group.

TEMPLET: A couple of years ago I began participating in a group called the Strip Center Loss Prevention Information Exchange. As the name implies, the basis for our group is information sharing. If someone has a problem or something has happened in a particular area, members know that they can put a question to the group and get multiple responses from senior LP executives in less than 24 hours. Even though our business models are very different from electronics to clothing, general merchandise to footwear the challenges of protecting our stores are similar. In fact, the different business models provide a very broad perspective of what others are doing. The information and support I get from this group is undoubtedly very important to my decision-making and how I present ideas to my senior leadership team. Conversely, I get a reality check from the same group of people if I suggest a concept that maybe needs to be rethought or repackaged before going forward. [See sidebar at right for more information about this group.]

EDITOR: In interviews like this, it’s always interesting to hear how LP executives got their start in the industry. Tell us your story.

TEMPLET: Funny you should ask. I started my career with Kmart many years ago when the world of loss prevention was really a different place. I was your typical high school check-out operator, stock clerk, pretty much anything that needed to be done, I did. We had a loss prevention manager that I got to know who was in his mid-to-late 40s. As we got to know each other, he started using me to chase down shoplifters because I was younger and a lot faster than him. He would put me out in the parking lot, and if the shoplifting apprehension didn’t go as intended, my responsibility was to chase them. Remember this was in the old days of loss prevention. That would never be allowed today and is unacceptable under any conditions, but we’re talking twenty-five years ago when I was young and dumb. When that fellow was promoted to district manager, he asked me if I was interested in getting into loss prevention as a career. I took him up on the offer and haven’t stopped since.

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EDITOR: I think it is important that you emphasized how inappropriate that is today because we still hear about LP and store personnel chasing shoplifters and sometimes getting hurt or even killed.

TEMPLET: Unfortunately, that’s true. But I think it goes beyond just being young and dumb. It requires really communicating expectations and the right and wrong ways to meet those expectations. When you have people who are young, aggressive, who want to be successful and please their boss, sometimes they will make bad decisions if we haven’t educated them appropriately. They think they are doing the right thing, but it gets out of control. As an industry, we need to do a better job of educating our store personnel on the very serious repercussions this can have on them and the business.

EDITOR: No doubt about it. Finally, let me ask you about any mentors or people who influenced you during your career.

TEMPLET: Two people come to mind. The first person is someone who probably doesn’t even know how much influence he has had on my career. When I was a district manager at Kmart, the company launched the Super Kmart division. I made a choice to take a step back from core Kmart to get into the Super Kmart division as a store-level manager in Baton Rouge, Louisiana. That’s when I had the opportunity to work with Dan Faketty, who is now vice president of LP at Winn-Dixie. I saw the way he carried himself, the way he handled the people who worked for him, and even the people like myself who didn’t report to him. He was really interested in our development and what we needed to do to be successful. Even though we went different ways, I’ve always followed his career and never miss his presentations at conferences. Over the years I’ve sent him questions, and he’s always provided me with feedback.

- Digital Partner -

Another thing. He wrote a series of articles for LP Magazine a number of years back on the six steps to creating a loss prevention program. I still have those articles and referred to them as I was developing the LP department at my previous company and here. The things he talked about in those articles were thought-provoking and helped me consider what I needed to do and how I could apply different strategies in my situation. [The articles “Six Steps to a Successful Loss Prevention Program” are available in the magazine archives at]

EDITOR: Who was the second person?

TEMPLET: Right after I started with Rent-A-Center, I attended my first annual leadership meeting where all of our district managers, regional directors, and divisional vice presidents were brought together. At that meeting, I remember listening to our CEO, Mark Speese, use an analogy that I’ve adopted and have used over and over again. Even though he wasn’t talking about loss prevention at the time, I think it’s a perfect analogy for us. Here’s how I adapted it. “Loss prevention is like medicine. If you use the right amount, it can help you. If you use too much, it can kill you.” Our best intentions are to protect the business and do all the right things. But if we go overboard with it, specifically in our business model, we can strangle our business and really negatively impact our ability to drive the top line and the bottom line of the company.

EDITOR: That’s a great analogy, Bobby. Thank you for sharing that and sharing your story with our readers.



The Strip Center Loss Prevention Information Exchange

This organization was originally conceived at an informal gathering at the 2002 National Retail Federation loss prevention conference of LP executives with common store demographics. Endorsed by the corporate leadership of each member company, the LP executives hold regular conference calls and annual meetings to exchange information pertinent to issues of property protection and employee safety in a strip-center retail environment.

An early by-product of the original group of ten companies representing 25,000 stores was a program and policy paper entitled “The Strip Center Benchmark Survey” that is the centerpiece of each member’s commitment to progress and professionalism within the group.

Prospective members must meet the following criteria:

  • Their company must be a multiunit specialty retailer with locations in national strip centers.
  • They are the head of the loss prevention or asset protection department in their company.
  • They must have permission from their company to participate in miscellaneous surveys from time to time, including the Strip Center Benchmarking Survey.

Current members representing over 26,500 stores include Ashley Stewart, Cato, Citi Trends, Dollar Tree, dressbarn, DTLR, GameStop, Payless Shoesource, Rainbow Shops, Rent-A-Center, Sally Beauty Holding, Stage Stores, Variety Wholesalers, and the associated brands for these companies.

For information about membership, contact the organization’s chairperson, John Feretich of Rainbow, at

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