Article of the Month - Pilferage Prevention

In the US retail business, pilferage losses account for a staggering $46 B of which organized pilferage is very high at 65.20%.

• Impact of pilferage on retailers
• Loss of goods
• Non availability of stocks or stock outs
• Loss of customers
• System showing stocks and thus buyers not ordering for the stocks
• Fast moving category suddenly becomes slow moving

Some facts and figures on shoplifters and staff pilferage:

• 1200 women were in prison for shoplifting compared to 4000 males
• Small scale theft accounts for more than one third of offences, but almost one quarter relates to thefts of goods valued at more than £500
• What is stolen goes along predictable gender lines with women taking items such as clothing, groceries, health products and perfumes, while males go for electrical equipment and power tools
• With staff theft the average value of theft rose as they are in positions of easier access and trust
• The average stolen by women staff was £816 compared to £919 for men
• 52.6 per cent of goods stolen by staff is cash, 26.2 is goods and almost 4 per cent is both
• Other significant frauds are refund fraud, collusion and fraud involving loyalty cards or gift vouchers

Who is the target?

The biggest targets are

• Medical stores
• Malls close to the highway
• Specialty stores and
• Super markets

The most targeted categories are

• OTC medicine
• Razors
• Music
• Baby care products
• Diapers
• Smoking cessation products
• Batteries, Hardware tools
• Designer clothes
• Electronics and
• Cosmetics

How are retailers countering pilferage?

• Increasing the number of close circuit cameras in the store
• Installing security systems at the exit
• Training staff to respond within 12 seconds to an alarm
• Retailers working to gather a joint database of regular offenders for more forceful prosecution
• Installing software to track shoplifting pattern regionally
• Complicated fixtures at stores that prevent lifting of multiple packages at one time

In addition, Wal-Mart, Target and other leading retailers have formed an organized crime division to deal with the problem.