One of the biggest contributing factors to retail shrink is employee theft. Employees often have access to very sensitive information and otherwise restricted areas, making theft “easy” to pull off. This can be detrimental to a retail business’s financials if it is not closely monitored and prevented.
There are few factors that contribute to an employee stealing. It has been found that if an employee is having trouble with addiction, or is having financial struggles (which is often the case in South Africa), theft becomes more of an appealing option.
One cannot always prevent an employee from receiving an unexpected bill or forming an addiction; however, measures can be put into place to make it difficult for employees to steal.
Prevent Employee Theft: Spot the Warning Signs
In order to prevent employee theft from happening, one should be able to identify the warning signs of an untrustworthy employee. Luckily there are a few key tell-tale signs.
- Pay attention to whether or not an employee might have an addiction problem.
- Take note if an employee is using materials available to them at work to enable a second job or income.
- It is a red flag if an employee is living a lavish lifestyle that is well above their paygrade.
- It could be suspicious if an employee that does not seem to have much drive suddenly starts working late.
- If you want to implement new procedures that could prevent internal theft and an employee is objecting heavily, it could be a strong indication that they are considering, or have already, committed stolen from your business.
Employee Theft Prevention: The Solution
There are multiple prevention tactics that can be used to improve procedures, and prevent employee theft from occurring in your business.
- A Strict Hiring Regime: hiring the right employee is probably one of the most important aspects for preventing employee theft. Ensure you follow a rigorous hiring routine to flush out those that could potentially steal.
- Be Present: it is extremely important that the owner or manager of a business has a strong presence. Further than that, it is good practice to get involved and get to know your staff. You can keep an eye on employees in this way.
- Randomised Cash Counts: it could be effective to randomly perform cash counts. If this is done regularly and all employees know it could happen at any moment, they will be less inclined to steal money.
- Security Camera Systems: you can install a security camera system that faces the cash register, and is focussed on the employee at all times. In this way, you will always be able to watch out for theft, and potentially have evidence of the crime if it does occur.
- Anonymous Reporting: allowing your staff to report potential or ongoing theft could provide a business owner with valuable information.
- Inventory Management System: a good inventory management system is essential to successfully preventing internal theft. Systems that allow you to perform perpetual inventory management (easy and regular, daily or weekly stock take) ensure that you are always updated on your stock, and will notify you if any inventory that has not been paid for leaves the shop.
There are multiple other benefits that come with inventory management systems such as RFID. At Milestone, we have over 20 years of experience in helping retail stores prevent shrinkage. Contact us to find out more about how we can help you prevent retail theft.
