How to Protect Retail Inventory This Holiday Season (Checkpoint)

This year’s holiday shopping season is expected to be strong, according to data released by the National Retail Federation (NRF). Retail sales during November and December are forecasted to be as high as $682 billion, a 4 percent increase from last year.

The picture isn’t entirely rosy, however. The NRF’s 2017 National Retail Security Survey shows that two-thirds of LP budgets are flat or declining, and the average inventory shrink rate has increased to 1.44 percent, with 36.5 percent resulting from shoplifting and organized crime and 30 percent from employee theft. In order for retailers to make the most of the booming holiday season, they will need to find new solutions to prevent loss in stores.

With items such as baby formula, razors, and pharmaceuticals high on the list for theft and counterfeiting, retailers, consumer packaged goods companies (CPGs), and brands are beginning to collaborate to develop solutions that turn packaging into a deterrent for would-be criminals.

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For example, QuadPackaging and Checkpoint Systems have joined forces to make packaging more effective as a loss prevention tool. In fact, QuadPackaging has presented the latest packaging protection for retailers trying to thwart organized retail crime and loss in-stores at recent Checkpoint-sponsored Annual National Source Tagging events.

Reliable Physical Security

For applications requiring reliable means of physical and tamper-evident security measures, consider two primary solutions—microperforations (or “microperfs”) and EAS tags. Microperfs aid in making any package tampering very evident to the retailer and the consumer, while EAS tags alert shop owners when packages leave the store without being cleared.

Microperforations. QuadPackaging understands that by adding small perforations in the carton along the carton flaps, accompanied by a simple wafer seal, consumers can be immediately alerted to any tampering with the packaging. Microperfs can be placed on the carton without disrupting the messaging or appearance of graphics, elements that are critical to brand positioning and consistency. Microperfs are built into the carton die, eliminating the need for extra steps in the production process.
A potential thief attempting to remove a seal placed over a microperf will create a large tear that’s easily noticeable. Microperfing is also very effective when used with a wafer seal over the bar code of a product as the UPC can be scanned as normal.

Source Tagging with EAS Labels. EAS labels are placed either on or in a package coded with a signal that alerts personnel when a product crosses a certain barrier if the item is not first sold and deactivated at the point of sale (POS). For optimal cost and performance, these labels are applied “at source” to the package automatically during the folding and gluing production stage, eliminating the need for an extra step in the process at a distribution center or store. A complete source-to-shopper EAS solution serves to improve on-shelf availability, enhance customer shopping experiences, and increase sales.

Overt Approach. In the past, CPGs gravitated toward covert security tagging as a measure to ensure brand messaging and imagery are not compromised; however, research demonstrates that overt solutions that are visible to consumers are more effective in the fight against theft. These solutions also streamline the security process for retailers by avoiding employees confronting theft at checkout. Examples include brand authentication codes or retailer-specific messaging printed on EAS labels.

New technology is continuously being developed at QuadPackaging and Checkpoint to assist in loss prevention. Ongoing education and the ability to combine loss prevention solutions in interesting and creative ways will help brands and retailers stay ahead as organized crime gets even cleverer.

What Can Brands and Retailers Do?

QuadPackging understands that your packaging represents a critical decision point in a consumer’s experience with your brand. Providing collaborative solutions and deep expertise—and backed by one of the largest printers in the world—QuadPackaging is committed to delivering your brand in its finest form.

Checkpoint Systems provides a full range of source-to-shopper solutions that address shrink. Its intelligent retail solutions deliver a unique offering of connected hardware, applications, cloud-based software, and EAS and RFID for high-theft consumables.

“At Checkpoint, we value our strategic partnership with QuadPackaging for integrated, visible EAS source tagging. We understand the importance of reducing high-theft shrink for our retailers, including improving on-shelf availability and reducing loss,” said Keith McUmber, director of source tagging at Checkpoint Systems.

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