Combat Organized Retail Crime with a Retail Loss Prevention Protocol
How organized retail theft is changing the way we think of, and react to, retail crime
One of the most insidious things about retail loss and shrinkage is that, 44 percent of the time, your own employees are involved in some way. Maybe they turn a blind eye to a "friend's" sticky fingers. Maybe the employee has figured out how to game the system by palming a pack of chewing gum or a candy bar while ringing up rib-eye steaks. Maybe your employee is actually a member of an organized retail crime ring, tasked with helping criminals identify and walk out with high-end merchandise or even cash. Organized retail theft may sound like the plot of a cheesy novel, but it's a very real loss prevention nightmare that costs the American economy billions of dollars every year.
Why Organized Retail Crime Is Different Than What You're Used To
Unlike the odd shoplifter, thief, or honest person who made a mistake, such as forgetting to properly scan a particular item in the self-checkout lane, organized retail theft is far more sophisticated. In many cases, retail theft rings are well aware of your company's security precautions and loss prevention practices and have planned out multiple avenues for circumventing them. In many cases, retail thieves have even figured out how to use your own loss prevention countermeasures and technology against you and your business.
There is no particular profile for who may or may not be a retail thief. Members of these rings come in all shapes, sizes, colors, genders, economic levels, and ages. Sometimes, retail theft rings will use children, rightly thinking that the police, store management, and security in general will tend to be more lenient with a kid caught trying to steal than an adult. However, the types of theft children are likely to be involved in are less sophisticated and costly than those adults get into by several orders of magnitude. This doesn't make it any less damaging on the grander scale, but retail thieves often possess an uncanny understanding of and ability to manipulate human psychology, which they employ to counteract loss prevention controls.
How Organized Retail Theft Works
Many organized retail crime rings rely on having an "insider," usually an employee, to help them carry out their schemes. This could be as simple as letting a friend walk out with a $200 dress that was scanned as a $20 T-shirt or as complex as a series of bogus returns on merchandise that was never actually purchased or accepting faux coupons. The details of how a given organized retail theft ring operates can be surprisingly complex and sophisticated, forcing loss prevention personnel and management to work harder to keep these predators at bay.
With the advent of self-checkouts, honest people have actually worked harder to make sure they ring in all their items. Organized retail theft rings love self-checkouts, especially when they can get their friend to hook them up with free stuff. However, someone manning the self-checkout lanes may not be in league with the thieves. They may simply be inured to the alerts from these lanes locking up. Complacency among honest employees is the biggest bar to effective loss prevention and the greatest aid to retail thieves. Because of this, employees manning self-checkout lanes should be doubly vigilant. You may want to consider switching out employees regularly so that they don't have time to get bored or desensitized to alarms.
The new Holy Grail for many organized retail theft rings is data, such as customers' credit or banking information. Despite all the available security precautions, a person with a credit card scanner can pickpocket sensitive data right out of thin air, even when the card is safely tucked away in a wallet or purse. An employee with access to this kind of data and the desire to use it to defraud customers and your business can easily obtain the necessary information and make it look like they didn't have time to do anything at all. Because of this, sensitive data is rapidly becoming the most worrisome and potentially expensive organized retail theft scam going.
The most sophisticated organized retail crime rings may use a variety of the methods above. While, on a daily basis, the shrinkage may not look like much, over a period of weeks or months, an efficient, well-organized retail theft group can have a huge impact on your business and your bottom line.
How to Fight Organized Retail Crime
If criminals wore old-fashioned mustaches, black hats, and eye patches, they'd be easy to catch. Unfortunately, criminals are rarely so accommodating. The good news is that there are proactive steps you can take to help deter them and prevent shrinkage. First, hidden cameras in areas even the most dedicated criminal wouldn't think to look, like air vents or smoke detectors, can give you more eyes and help you catch more illicit activity. Sound auditing practices and switching out employees' locations and tasks on an unpredictable schedule reduces the likelihood of an employee and an accomplice linking up. Finally, engaging all employees as active front-line loss prevention by encouraging vigilance and reporting of things that just don't look quite right are steps that can help reduce shrinkage.
Published September 10th, 2015