3 Key Ways You Can Use Physical Security to Mitigate the Threat of Organized Retail Theft
According to a National Retail Federation survey, retailers in the US alone lose almost $50 billion to theft every year.
- By Duane Humphreys
- Feb 28, 2019
Organized Retail Crime (or ORC, as it is sometimes known) remains a consistent and remarkably expensive problem for retailers.
According to a National Retail Federation survey, retailers in the U.S. alone lose almost $50 billion to theft every year.
This article helps explain what organized retail crime is, and how as a retailer or loss prevention manager, you can use physical security measures to protect against it.
What is Organized Retail Crime?
There are varying definitions of this group of crime, but the most thorough definition comes courtesy of the Loss Prevention Foundation:
"Organized retail crime (ORC) involves the association of two or more persons engaged in illegally obtaining retail merchandise in substantial quantities through both theft and fraud as part of an unlawful commercial enterprise."
ORC therefore includes many forms of retail theft, ranging from credit and gift card fraud through to e-fraud and identity theft.
In this article though, I’ll be focusing mainly on the physical security side of ORC, and what you can do to help protect your premises against Retail Theft.
Protecting your store against organized physical attack:
There are 3 main steps you can take to ensure you have done due diligence in protecting your retail store:
- Understand your risk
- Do your research
- Invest in physical security
First things first:
Understand Your Risk
Retail covers a massive spectrum, so be aware where you sit within this; a discount supermarket like Aldi or Lidl will need to approach this very differently to a luxury high-street brand like Louis Vuitton!
The main points to consider here are:
- What value goods are you protecting? If you have high-value items, you won't have gone un-noticed, so you need to make sure the goods are effectively secured. The higher value the goods, the larger the risks criminal groups will be prepared to take to steal them.
- Are attacks during working hours a possibility? If so, protecting people will need to be high on your priorities. Instances have occurred where criminal gangs have used high power saws to cut through walling just feet away from where staff are working!
- Where is the store? Have there been other instances of ORC in your area over the last 2-3 years? Although this doesn’t always mean your threat is higher, crime hotspots do tend to be geographical, so it’s worth being aware of.
There are clearly many other factors to consider, but the three factors above are going to be the three that most affect the risk level.
One of the most effective ways to help you categorize your risk level are independent security standards.
By far the most recognized of these standards is LPS 1175
More detail on the standard can be found on the link above, but in essence, the LPS 1175 standard categorizes security levels by attack time, and attack tools.
For example, if you’re a corner shop, you are unlikely to have high value goods in your store, so tools like reciprocating saws are unlikely to be a concern.
And if that shop happens to be in a heavily populated area, then the attackers are unlikely to be willing to persist for more than 2-3 minutes before they give up and leave.
By way of contrast, if you are a luxury jewelry shop, the "size of the prize" for an attacker is much larger, so you’ll need to secure your premises against powered tools, and likely for a longer attack period as well.
By understanding your attack time and attack tools, you will arrive at an LPS 1175 security rating (these range from SR1 all the way to SR8)
Security products such as doors, roller shutters, security glazing, and so on, can be certified to LPS 1175 by independent test houses.
Therefore, if a manufacturer claims the LPS 1175 rating on their product that you are after, then you can be sure that that product provides the correct security rating for your risk level.
Do Your Research
Every retail store has a different threat level and / or type and will need different security measures to mitigate the threat of ORC.
Don’t fall into the big retailer trap of thinking because something has worked on one store, it will therefore work everywhere else. That’s not how it works.
Every store has a unique risk profile and will require a unique solution. Yes, there are recurring challenges and corresponding solutions, but if you haven’t done your research yet, you run the risk of applying a blanket security specification without really understanding why you’re doing what you’re doing.
There is a lot of great content online around how to assess your threat levels and secure your store – so use it!
If you’re still not sure after doing some research, most loss prevention managers or security consultants will be happy to have a conversation with you to help you understand the level of security required.
Invest in Physical Security
If you want to effectively secure your retail premises from ORC, you need to be prepared to invest into physical security.
Although the upfront capital required for this can sometimes be a little uncomfortable, when you start putting some numbers at the cost of ineffective security, it becomes a no-brainer.
The cost of ineffective physical security in retail falls into two categories:
Direct Costs (the actual cost to you as a store of a successful ORC attack). This includes the cost of the goods stolen, and the damage done to the premises in the attack.
Indirect Costs – (anything that happens as a result of the break-in) including down-time whilst repairs are being done, the cost of injured or shaken staff, the damage to the brand and reputation, and so on.
Even if you put very conservative numbers on these costs, they still dwarf the investment needed to prevent them having an impact in the first place.
With budget supermarkets and online giants like Amazon making their impact felt on the high-street, most retailers are slashing costs wherever they possibly can to keep their heads above water.
This is very often seen in smaller and smaller budgets on physical security.
My contention would be that an intelligent investment into physical security will mitigate the risk of a successful retail criminal attack.
In almost every case then, upfront investment into physical security is not only the right thing to do from a security point of view, but a very shrewd commercial decision as well.