Employee theft is defined as the stealing, use or misuse of an employer’s assets, by an employee, without the employer’s permission. For many retailers, employee related issues have often been regarded as a “part of doing business”. However, recent studies show an increase in these issues, making this a much more significant problem for the retail and hospitality industries.
As an example, a recent US Chamber of Commerce study estimates that 75% of employees steal from the workplace, costing US Retailers nearly $18 billion annually. Employee theft now accounts for more loss per year than shoplifting, with the average case being 6 times the size of shoplifting cases. This is now the fastest and largest segment for loss in the retail space.
There are many challenges to managing this problem. Theft or manipulation around the register is typically the largest source of these losses. Some of these thefts are discovered after a series of unexplained mishaps, which may be actual theft or a simple need for more employee training. On a larger scale, employee embezzlement or cash theft from a company sometimes isn’t discovered until long after the employee is gone. To make matters more challenging, theft is often times happening from a trusted employee or manager that is familiar with the company’s internal controls.
Many business owners will utilize surveillance systems to help address these issues. Unfortunately, general video surveillance typically does not properly tackle this issue. Most business owners don’t have the time to watch hours of video looking for the information they need. This often leads to systems that are not used or monitored, a situation that most employees are aware of. A camera over the register that was used as a deterrent loses all value when the employees knows the systems are not regularly monitored.
To tackle this situation properly, a more proactive and analytical approach is typically needed. Innovative software products, like those developed by DIGIOP, can not only cover surveillance needs, but they can also integrate with key data sources to provide a broader picture of the business. Additional data points, such as Point-of-sale systems, freezer unit outputs, and traffic analytics, provide business owners with actionable data to review.
This integrated information will show patterns, trends, and anomalies in the data. The identification helps business owners quickly analyze fraudulent activity, while providing synchronized visual evidence of the incidents. These tools, along with a commitment to a strong action plan, will help a company stand out in their ability to limit losses. Ultimately driving an increase in sales and margins, a positive impact for store owners who strive to be more effective, more competitive, and more profitable.
Additionally, adding a loss prevention program will increase the effectiveness of identified anomalies and patterns. Many business professionals either don’t have the time nor are qualified to detect and prevent financial fraud, inventory shrinkage, embezzlement and employee theft. Therefore, adding professional risk management services can be critical for single and multi-unit businesses.
Key Services to consider:
- Risk Assessment: Helps to identify weaknesses in a company and allow implementation of programs/ strategies designed to meet a company’s operational needs.
- Remote Point of Sale and Video Monitoring: Allows managing the technology with a focus to reduce employee theft and primary shrink contribution factors.
Implementation of an agile software that provides intelligent ways to utilize video and data while adding loss prevention services, cost much less than the employee theft and shrinkage occurring in businesses today. Start today, increase your profits with a meaningful and worthwhile program.
(Editor’s Note: This article was produced with the assistance of DIGIOP, a powerful video management software application that delivers simple, user-friendly tools designed to help you find the information you need faster. If you would like to learn more about taking a proactive and analytical approach to loss prevention visit their website at digiop.com or call them at 1-800-968-3606.)