Dude, Where’s My Shrink?

For those of us 30 years or older, you may remember the 2000 movie starring Ashton Kutcher, Seann William Scott and Jennifer Garner, titled “Dude, Where’s My Car?”. In the film two young men find themselves unable to remember where they parked their vehicle after a night of reckless partying. They wander aimlessly encountering all types of obstacles in their quest to find their car. This movie obtained cult status and box office success, even though it was widely panned by the critics. When speaking with colleagues and prospective consulting clients, I often think what they are really asking is “Dude, Where’s My Shrink”?

Indentifying a company’s shrink source(s) is no easy task. We best relate it to a doctor and patient relationship. When you are ill you visit your doctor to tell him your symptoms, he runs a variety of tests to determine what he believes is causing your illness and then prescribes specific medication. If your doctor is thorough, he does not tell you to just eat better, get more sleep, and start exercising (although many of us likely need this!). Your doctor will prescribe specific medicine focused on your exact illness to get you healthy again. Appropriate treatment cannot be prescribed through a cursory checkup, or a face-to-face interview.

Well, the same goes for identifying “Where’s My Shrink?”. Some have compared it to the famous ‘Shell Game’ where one has to guess which shell has the pea under it, after someone quickly shuffles around the shells. Here the shells are Internal Theft, External Theft and Paperwork/System Issues. We have learned over the years that the very first step towards effective inventory shrinkage control must commence with an in-depth analysis to accurately identify a company’s primary shrink cause(s). This is not a process of a few key executives giving their perceptions of what is creating loss, and then developing some strategies to meet their perceived need. Guesswork usually results in failure! Nor does it involve copying another retailers program, as each company has its own shrink issues based on product type, store locations, clientele, current anti-theft safeguards, effectiveness of internal controls, system accuracy, and so on. Simply replicating someone else’s Program, is typically a recipe for disaster!

To be successful, management must gain a clear understanding of the role that each contributing factor is playing in the overall shrinkage problem. Rarely, if ever, is there a ‘silver bullet’ or single major issue that is causing a company’s shrinkage. Once the shrink issues/concerns are identified (through a detailed on-site analysis of DC, Store and Home Office operations as they pertain to product movement and accountability), appropriate custom programs and/or strategies which specifically address each primary shrinkage contributing factor must be developed and implemented. In addition, when completing this phase, the company’s culture must always be considered and taken into account. What may work in one company may not be so successful in another company, simply due to their culture.

Unlike the ending of the movie “Dude, Where’s My Car?”, where the young men recover their car which just happened to be hidden behind a Mail Truck the entire time, shrink is usually hidden in the details and not easily identified without a true comprehensive analysis. $

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