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8 Tips To Minimize Employee Shrinkage – 10x Higher Theft vs Shoplifters

8 Tips To Minimize Employee Shrinkage – 10x Higher Theft vs Shoplifters

8 Tips To Minimize Employee Shrinkage – 10x Higher Theft vs Shoplifters

Tis the season to shop – and unfortunately, to also steal…

Internal theft is actually more prevalent than consumer shoplifting. It’s a tough fact to face, but we only have ourselves to blame if we are creating opportunities and just plain making it too easy.

“On average, shoplifters steal $196 worth of goods per incident, while employees steal an average of $1,944 —virtually 10 times higher.” –

8 tips for spotting possible INTERNAL theft:

  1. Overuse of phone
    Internal theft is easier with an outside partner. If  you notice an associate who is on the phone more than usual and hangs up quickly when you appear, they might be setting up a theft. Instruct your associates that they cannot make / take personal calls except in emergencies. Hang out to occasionally eavesdrop on “customer” calls that don’t seem business related.
  2. Frequent volunteering to open / close the store alone
    What better time to sneak merchandise out to the car or a partner then alone in a the store before opening or after closing?  If you run a small store where it is common to have a single person open or close, plan to occasionally come in before you are expected or stay later without notice to thwart theft opportunity and keep them off guard. And publicly spot check your inventory to let them know you are keenly aware of your stock levels.
  3. Frequent breaks taken outside the store – especially out the back door
    Especially now with smokers having to smoke outside, make sure their smoke break out the back door is not accompanied by merchandise into their car. And obviously smokers aren’t the only suspects. In a small store with only 1-2 on staff, if someone has to watch the floor, the other has complete privacy going out the back door with whatever they want. Insist on no one going out the back door. Have garbage buddies – no one dumps garbage alone. Those empty boxes might not be empty. You can claim you are concerned for their safety out in those alleys if you are worried about revealing distrust …
  4. Over eager to be in charge of the stock room and eagerly assists Shipping Person
    Huge opportunity for theft here.  If you aren’t publicly spot checking your inventory, you are telling everyone you have no idea of your stock status. They know you won’t miss a few things missing… And if there is a sudden or unusual “friendly” relationship with your neighborhood UPS, FedEx, etc. person, that can also be a red flag. False labels can be created and merchandise may be getting shipped without payment. Keep a shipping log, track sales, spot check shipments and be present when shipments go out.
  5. Over eager to be cashier
    If your floor personnel is too eager to help out at the cash register, again they may have scheduled a partner to come in to purchase from them and then ring up expensive merchandise at a “bargain” price. Skim your sales journals daily to note any unusual activity and keep the cashiering to the cashiers – but track their sales journals, too.
  6. Friends hang out too long for a normal visit
    You may have already have a mental flag on this one. Trust your gut. Why would anyone want to hang out in a store to wait for their friend who works there – especially if the merchandise is desirable to them.  They could either be partnered with an associate or taking advantage of that associate’s presence to have an opportunity to hang out long enough for a stealing opportunity. Friends should wait outside to visit.
  7. Carries a large bag of “personal” items
    Make a rule that associates should only bring necessary items to work and all totes and bags will be spot checked. Set this law down upon hiring! It is too easy for people to hide items in their bags. Don’t hand them the ability to steal.
  8. Acts like the “Perfect” employee
    This one hurts the most. You have an associate who looks perfect to groom for management or more responsibility. You spend extra time training and taking them under your wing. Then you find out they have been so great because they wanted to stay under the radar for misdeeds. Again, overeagerness to “help” and to take on more responsibility usually leads to more independence and trust – so obviously more opportunity to steal.

I am not saying you can’t trust anyone, but I have seen in my many years of retail that internal theft is usually the owner / manager’s fault for being too complacent in their operations.

You offer too much opportunity and even the most innocent might take advantage of too easy an opportunity to steal. Remember, first it might be just $10 out of the cash drawer to buy gas until the paycheck comes in, then tomorrow, its a false return rung up to pay the utility bill… You get the picture.

Don’t create criminals where there might not have been one before and protect your profits – this is your money

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  1.  “You miss 100% of the shots you never take.” Wayne Gretzky – Focus on Where You Want to Go | Whitfield Consulting
  2.  “You miss 100% of the shots you never take.” Wayne Gretzky – Focus on Where You Want to Go | Whitfield Consulting