Special Current.com.au Feature by Claire Reilly
Every year, according to the Australian Retail Association (ARA), it is estimated that the Australian retail industry loses roughly 3 per cent of total turnover to theft. Using the ARA’s figures, in a $243 billion industry, that equates to $7.5 billion annually.
That is certainly a hefty price to pay for a few sticky fingers.
But according to the executive director of the ARA, Russell Zimmerman, it is likely that the electrical retail industry loses much more than that 3 per cent figure, because consumer electronics products typically satisfy three key criteria for theft: they’re small, they’re worth a lot of money, and they’re easy to re-sell or pass on once they’ve been stolen.
Stock loss, theft, shrinkage – whatever it’s called, it’s certainly a big issue for electrical retailers. But what are the best ways to identify a thief, stop the crime and help reduce future losses?
“Invariably shoplifters work in gangs,” he said. “So quite often you can pick them by the fact that they’re in groups of people. They walk into a store at a quiet point in time, particularly if there’s only one or two assistants on, then they distract people so that the thief is able to take items without attracting attention, because the other staff are all tied up.
“The other obvious time when they do it is when the store is absolutely flat-strap busy and the sales assistants don’t know that somebody is casing the place out and walking out with the goods.”
Ben McIntosh, general manager for Harvey Norman Electrical, said the best way to keep stock from disappearing was to keep staff busy and alert.
“I believe that staff in retail perform better when it’s flat out,” he said. “Statistically, the research shows that most theft, shoplifting and bad service occurs when stores are quiet, not busy.
“The customer’s annoyance level rises profusely when they walk into a store that’s not busy and they’re still not getting served. Most theft occurs when stores are quiet because the staff aren’t on the ball.”
Zimmerman offered some of his ideas for retailers to employ.
“If you see someone acting suspiciously, you may want to call a senior supervisor just to review what’s going on. If you’re in a store are people out the back doing work, I actually think it’s great if you have a code. A lot of phones have small PA systems on them, so you might call out ‘Code One please’ or some kind of a way of attracting the staff. The staff will then think, ‘There’s something going on, I need to drop everything and get out there as quickly as possible’.
“From a retailer’s perspective, you need to have the best practises in place to avoid theft. That comes down to the very simple things like keeping cupboards locked. That’s an obvious one, yet so many people get a product out, leave it on the counter, turn for a second to deal with another customer, then turn back and suddenly the product is gone.
“So don’t get distracted when you’ve got a high-priced small item out there. Without turning away just say, ‘I’ll be with you in a minute but I’m just serving this person’.”
Zimmerman also suggested tools such as remote cameras that can be viewed on a smartphone (for keeping an eye on unseen parts of a store), discrete tags that look like regular pricing labels, but can be used to trigger security alarms, and extra security staff. While he conceded hiring a security guard could be expensive, “If your theft is going to be greater than what you pay your security guard, then there’s a good case to do it”.
If it comes down to approaching a thief, protecting yourself with a clearly displayed ‘Bag check’ sign is a good strategy, he said, so customers know that staff have the right to check their bags if they’re suspicious. Rather than coming out and accusing a customer of stealing, he suggested a less confrontational phrase such as ‘I’d like to have a look in your bag’.
But, importantly, he also advised retailers to consider their safety.
“The other side of the coin is what I’ve always said to retailers: if you have a hold-up, there’s no such thing as a dead hero,” said Zimmerman. “If you feel that you’ve got a gang or you feel you’re in danger, you need to be vigilant that you’re not going to end up with a gun to your head.”
And Zimmerman’s tips on the products that are most likely to go walking?
“The smaller and more expensive items are most popular,” he said. “So in electrical stores, that’s quite a lot of products.
“People also steal things that are easy to flog on. For example, if you steal shoes, they’re very hard to sell on because you have to know people’s sizes. But in an electrical store, something like a small electronic watch, that’s something that a thief would target – it’s small, it’s worth a lot of money and you can get rid of it very quickly.”
A version of this feature first appeared in the February issue of Appliance Retailer magazine.