Security Goes Shopping

Advanced security technologies take loss prevention to lucrative new levels

• By Robert Siegel
• Nov 03, 2006

Loss prevention has become as important to retail profits as products, pricing and promotion. Retailers can preserve -- and often increase -- profits simply by investing in systems that reduce shoplifting and internal theft.

U.S. retailers lose $38 billion every year to shrinkage. Many retailers are surprised to learn that nearly half of shrinkage is due to employee theft and that the average recovery from an apprehended employee thief is seven times the average recovery from an apprehended shoplifter.

U.S. retailers lose $38 billion every year to shrinkage. Many retailers are surprised to learn that nearly half of shrinkage is due to employee theft and that the average recovery from an apprehended employee thief is seven times the average recovery from an apprehended shoplifter.

On top of that, half of employee theft takes place at the POS terminal -- that's $8.9 billion per year taken right out of the cash register. Interfacing video surveillance with POS is one of the most effective loss prevention strategies, yet only 13 percent of retailers employ it.

Stepping Up
By taking exceptions-based reporting to the next level and associating receipt text with video from digital recorders, retailers can determine if an employee is stealing from the register. Working in conjunction with exceptions-based reporting software, retailers match video with receipt text, such as "no sale," "void" or "refund" to help confirm suspicions that a cashier is stealing money or merchandise using phony transfers. But that's after the fact. Intelligent video can catch the employee in the act.

If approximately 23 percent of loss is enacted by employees at the POS terminal, there is still another 77 percent to account for, including robberies and shoplifting, price tag switching, credit card fraud and counterfeiting, customer return fraud, other employee and vendor theft, assaults or attacks, and burglary and vandalism.

So what's a store to do? Take advantage of technology that is already out there and stop the losses now.

Advanced camera techniques now capture clear, detailed images. Digital recorders retrieve footage instantly. Networked systems let users watch video over the Internet. And, because loss prevention goes beyond surveillance, users also can take advantage of integrated access control and intrusion alarms, GPS tracking and electronic keys.

An Eight-Step Program
Security specialists recommend retailers take eight steps to create a solid loss prevention program:

1. Deploy a high-tech front line of defense. Surveillance cameras are available in all shapes and sizes, including traditional, discreet, covert and dome cameras. New innovations overcome glare, shadows and backlighting. New direct-drive motors provide pans/tilts/zooms of exceptional smoothness and precision. Cameras allow users to capture identifying details, even as it follows prospective shoplifters moving through the store.

2. Share evidence quickly and easily. Whether the business has one store, a small chain or hundreds of stores, there is a digital recorder right for the application. Smaller retailers should make sure that their DVR has a built-in CD-R to make it easy to share evidence with law enforcement. Larger retailers can select units that capture 120 FPS in turbo recording mode, so that crucial details won't be missed.

3. Take exceptions-based reporting to the next level. With a POS interface, retailers can associate receipt text with video from digital recorders. This technology also works with exceptions-based reporting software. Loss prevention professionals can match video with receipt text like "No Sale," "Void" or "Refund" to help confirm suspicions that a cashier is stealing money or merchandise using phony transactions.

4. Subtly announce loss prevention measures. Many retailers display live video on a large screen, such as a 20-inch LCD, to announce they are using surveillance cameras. People literally see themselves on the monitor. When it's not showing surveillance video, these monitors can additionally display a variety of advertising and multimedia messages.

5. Mind the store remotely. Video surveillance systems will let loss prevention personnel view live or recorded video from any camera on the store's network from anywhere they have Internet access. Even if the operation's cameras are older analog models, new systems allow retailers to use them in a digital system.

6. Control access without keys. Smaller retailers can take advantage of new systems, providing a single platform for intrusion alarms and access control. One card unlocks doors, disarms alarms -- even turns on the lights -- automatically. At closing time, the store manager or owner simply locks up, and the central station operator takes over automatically.

7. Deploy deliveries efficiently. Business service mapping uses GPS to track and deploy delivery crews. Using an intuitive, map-based interface, dispatchers can schedule projects and assign employees and vehicles to create customer satisfaction with on-time deliveries. Such systems can even determine the best driving routes and generate driving instructions. The increase in driving efficiency will save time and money.

8. Manage access to delivery vans. Retailers also can equip delivery trucks with locking systems that audit every time a lock is opened and by whom. These intelligent electronic key systems also let retailers manage key holders, access codes, expirations and renewals to prevent unauthorized use.

Types of Systems to Employ
The variety of loss prevention systems that can be employed are as varied as the locations they help to protect. Conspicuous video cameras deter many thieves just by their presence. DVRs and advanced cameras capture clear, sharp images to help identify thieves. Associating video with point-of-sale text will help a retailer easily match video with voids, no sales, excessive returns and other suspicious transactions.

Networked systems let retailers watch video over the Internet. Going beyond surveillance, access control systems and intrusion alarms protect high-value areas and provide additional security for stores after hours. GPS tracking and electronic keys protect delivery trucks and vans, pinpointing where they are and assuring only authorized individuals enter -- or have entered -- the cargo hold.

Reducing losses from shrinkage is an important job. But today, retailers and security integrators have many tools at their disposals. Retail loss prevention systems can protect goods from the depot to the store.