How to Prevent Retail Shrinkage

    Feb 23 2015

    Topics: Retail Shrinkage

    Retail shrinkage is a rampant problem in the industry as a whole. If you don’t have a proper loss prevention system in place, it will happen to you—right under your nose. It can be caused by internal theft, paperwork errors, or shoplifting, among others. It can and will occur at any point in the retail cycle—during cash handling, when merchandise exchanges hands, or when paperwork is processed. Don’t wait until retail shrinkage significantly affects your bottom line. Prevent it before it happens.


    Internal Theft             

    If given the opportunity to steal, many employees will. Without proper surveillance and oversight, you’re risking being taken advantage of by your own staff members. Whether they’re taking some items from inventory or grabbing cash out of the register, internal theft can hurt your profits. They may destroy a sales ticket and pocket the cash after a sale, record a fake refund and take money, steal merchandise without paying for it, or give out unauthorized discounts to their friends or to themselves.

    To curb the problem, ensure your system is properly automated, so every dime that comes through your register is recorded. A cash management software solution can centralize your cash management by reporting all cash inventory in real time, so you’ll know if anything looks suspicious. This oversight can deter would-be thieves from helping themselves to your money. An automated till solution is the best way to ensure your employees never steal cash – you can’t take what you can’t touch

    Paperwork Errors

    Not recording all markdowns, marking products at a lower price than the retail price, miscounting physical inventory, and making clerical errors during the accounting process can all cause you to suffer from retail shrinkage. Your book inventory and physical inventory counts should always be the same. When you automate your inventory system, you can take human error out of the equation so you’re only left with reliable, accurate inventory counts. Similarly, using cheque scanners, currency counters, and currency recyclers can provide you with the assurance that all of your money is counted accurately and that no paperwork errors have been created by tired or distracted employees. The machine will count and record the totals for you.

    Shoplifting

    When you work in retail, you know how prevalent shoplifting can be if you’re not careful. Seasoned shoplifters, thieves of opportunity or temptation, regular customers, and first-time customers can all steal from you. Don’t give them the opportunity. Install several surveillance cameras in your store and ensure your employees are free to pay attention to the customers that enter. Managers are highly valued employees who often spend hours in the back room counting, reconciling and preparing cash.  An automated cash management solution frees up your managers time so they can be out front managing staff and watching for any suspicious acts. These prevention strategies can make shoplifters too nervous, so they won’t risk being caught red handed, either on video or by your staff. And for the thieves who want to get away with fake returns and refunds, ensure you have proper procedures in place that verify their purchases.

    A Commitment to Loss Prevention

    You should have a commitment to reducing retail shrinkage at your store. Without proper oversight, many people will take the opportunity to steal from you if you allow it. Automate your front end and back end cash handling process to ensure all of your money is properly counted, sorted, and recorded; have a well-documented system in place for all paperwork; and remove all temptation for internal theft and shoplifting. Prevent shrinkage before it occurs by utilizing a variety of different solutions. Retail shrinkage is a controllable expense—and you can control it with proper solutions.

     How to Improve Your Business With An Automated Cash

    Andrea Lombardi

    Andrea Lombardi

    Andrea joined the CashTech team upon its inception in 2003. Learning the business from the ground up, she now utilizes her expertise in account management, planning, and negotiation while managing the daily operations of CashTech’s sales, marketing, and logistics departments. Andrea holds a bachelor’s degree from the University of Western Ontario. She enjoys travelling and has a passion for personal fitness, including obtaining her kettlebell certification. Andrea lives in Toronto with her husband and two young sons.

    Find me on:

    Latest Tweets

    Contact Us

    CashTech Currency Products Inc.
    1040 Cardiff Boulevard
    Mississauga ON, L5S 1P3

    905.696.0733