Loss Prevention Tips For Retail Stores

/ Loss Prevention Tips For Retail Stores

Loss prevention tips for retail stores

As economic conditions remain challenging throughout most of Europe and instances of shoplifting are on the increase, many retailers are turning their attention to tackling loss prevention throughout their retail stores. Loss or shrinkage, as it is commonly referred to, remains a significant issue for retailers as it has the potential to negatively impact the bottom line and profitability.

In the UK alone, retail thefts in England and Wales have increased by 26% during 2022, according to the British Retail Consortium. Their crime survey indicates that almost 850 theft-related incidents are taking place each day. The cost of loss to retailers is staggering as theft cost UK retailers nearly £1bn during the 2021 financial year. While theft is only one cause of loss/shrinkage, it is a significant one that is likely to increase further. Retail loss is also caused by operational errors, which are somewhat easier to counter with intelligent technology.

It is crucial that retail loss is prevented wherever possible to protect the bottom line and the profitability of retail stores/shops. While retail loss prevention is undoubtedly a challenging task, advances in self-checkout and self-service technology have added new tools and techniques to retailers' arsenals. This article explores retail loss in detail and outlines our top loss-prevention tips for retailers.

Introduction to retail loss

Retail loss continues to affect retailers of all sizes, from small independent retailers to large multinationals and supermarkets. While a certain level of loss is to be expected due to the very nature of retail, all retailers strive to act to prevent and, if not, manage it where possible. Once retail loss starts to increase, bringing it back under control can be quite a task. One of the challenges of retail loss is that it has a significant number of causes, from deliberate theft and inadequate inventory control to operational errors.

The multiple causes of retail loss often necessitate the adoption of several solutions to tackle them effectively. Fortunately for retailers, there is an excellent range of solutions that can be deployed to tackle retail loss. Many of these solutions also have a minimally negative impact on sales, so loss can be tackled without impacting growth.

Most successful retailers manage retail loss by creating a dedicated programme that counters it. Many loss prevention programmes encompass technology, people, process, and store design. Technology plays a key role in retail loss prevention, especially with ever-smarter scanning solutions, intelligent CCTV and AI tools. The people in each retail store also have scope to counter loss if they are adequately trained and encouraged to. Meanwhile, adopting robust processes can help to standardise loss prevention across a retail store portfolio while ensuring that best practice is shared. Design can also positively control retail loss, as well-designed checkout zones are a great first line of defence against loss, something that our self-service and self-checkout specialists help retailers with.

Loss prevention tips

Improving loss prevention has the potential to boost your bottom line and can even increase profitability. While every retailer has their own challenges when it comes to retail loss prevention, there are a number of loss prevention tips that can help tackle most of the challenges that retailers are likely to encounter.

Develop loss prevention policies and procedures

While many retailers have loss prevention policies and procedures, not all have developed them sufficiently to counter the ever-evolving nature of retail loss. For example, the increases in deliberate retail theft during the last year require retailers to adopt a more robust approach to security. By the same token, this also has security implications, which have driven many retailers to adopt further security measures to protect their people.

Effective loss prevention policies establish a code of conduct and rules for employees and customers in your retail stores. This may outline everyday loss prevention activities your employees should undertake, including stock management, cash management and customer refunds. By continuously adapting your policies and procedures, most causes of retail loss can be countered effectively.

Adopt AI-powered computer vision

The persistent issue of theft in retail has guided the development of a whole host of different tech solutions to help retailers battle shrinkage. AI-powered computer vision is an incredibly powerful way to counter shrinkage directly within the checkout zone. By adopting AI-powered computer vision at your self-checkouts, you can identify instances of theft with ease. Computer vision uses top-mounted cameras at self-checkouts combined with AI anti-theft software to detect theft and boost in-store security.

Computer vision technology continues to evolve at pace and is becoming ever-more effective as an anti-theft solution. The cloud-based nature of the solution allows for remote updates and convenient servicing, which are both cost-effective and cause minimal disruption to day-to-day retail operations. Retailers that adopt this intelligent line of defence against theft for their retail kiosks will be best placed to reduce retail loss and protect their bottom line.

Integrate intelligent security scales

Theft is far from the only key cause of shrinkage; operational errors by users at self-checkouts are also a significant cause. It is all too easy for customers to make a mistake at a self-checkout when they have multiple items to scan and are rushing from a retailer to their next destination. Common mistakes include forgetting to scan an item or even scanning an incorrect product. Operational errors such as these can be difficult for retail employees to spot as they are far less obvious than instances of theft. This is especially the case with self-checkout hosts/assistants being ever busier and often having to monitor an increasing number of self-checkouts.

Security scales are a useful enhanced security feature that makes a great addition to self-scanning solutions. Intelligent scales will weigh your customers’ shopping and can determine whether any unscanned items are present. The solution can then provide a helpful prompt to customers who have forgotten to scan an item so they can scan it. At the same time, it also helps to prevent customers who aim to deliberately not scan all of their shopping.

Complementing the intelligent scales with LED lights that effortlessly communicate checkout-related issues to retail employees can increase the effectiveness of security scales. Employees can use different light colours and patterns to identify issues and take appropriate action to resolve them.

Invest in retail loss prevention training

Retail employees who have received specific training in retail loss prevention will be best placed to respond to it in-store. Although many employees will have gained experience in preventing loss, as new techniques and technology are introduced to counter loss, employing these effectively can make all the difference between a persistent problem of retail loss and under-control retail loss.

Helping retail assistants use the latest techniques and become more vigilant and adept at identifying suspicious behaviour will pay dividends. It is also essential to advise teams as to when their involvement ends and security’s starts. This ensures that everyone is aware of their role and responsibilities in countering shrinkage. Experienced employees can help guide less skilled employees and even direct training toward the shrinkage issues that are most prevalent in their stores. Mentoring programmes are also effective at passing on knowledge acquired during training across all store team members.

Improve store & checkout zone layout

Improving the layout of a store and its checkout zone is most often associated with creating an optimal shopping and checkout experience and maximising customer throughput. However, it can be just as effective at reducing shrinkage and preventing in-store theft. Intelligent, carefully considered layouts help retail assistants oversee each store easily and spot any instances of theft quickly so they can be dealt with.

In terms of retail store layout, creating open layouts with lower shelving and clear lines of sight is a great way to reduce theft. Potential thieves are likely to be deterred by the good visibility that retail assistants and security staff have over stores. It makes it less likely that they will be able to steal valuable stock without being spotted and, therefore, acts as a good deterrent.

Layout can play an equally important role in reducing shrinkage within the checkout zone. In this area, creating defined entry and exit points and establishing a clear layout which encourages all customers to move through the checkout zone in the same way works well. When a checkout zone has clear entry and exit points and a straightforward layout that funnels customers into the zone to a self-checkout to complete the checkout process and away from the zone, it is most effective. This makes it considerably easier for retail assistants to effectively oversee the checkout zone in a standardised way.

Our retail specialists help retailers with retail loss prevention

Pan Oston has been helping retailers overcome their key challenges, including retail loss, since 1968. Whether you are facing persistent shrinkage caused by theft or high levels of operational errors, we have solutions that can help. Our award-winning self-checkout and self-service solutions incorporate innovative technology, including AI-powered computer vision and scale security, to tackle shrinkage at its source.

Within our product families, we have an excellent range of self-checkouts and self-service kiosks for retailers, some of which are Red Dot Design award winners. The SLIM Balance self-checkout has won a Red Dot Design award in 2023 in recognition of its innovative yet robust design.

The SLIM Balance self-checkout

Our SLIM Balance self-checkout is a genuinely innovative self-checkout with a sleek yet robust design. Its standout features include Bi-optical scanners for high-performance scanning and AI-powered theft prevention to tackle retail loss. When it comes to the SLIM Balance, the possibilities are almost endless with its modular design and software & hardware independence. Impressive aesthetics and fantastic functionality await retailers that adopt the SLIM Balance.

At Pan Oston, we go beyond off-the-shelf solutions with our fully customised checkouts and kiosks. We create bespoke solutions for international and national retailers that suit their specific retail formula. By partnering with us, retailers benefit from our experienced design, manufacturing, and project management teams that tailor self-checkouts and self-service kiosks to your exact specifications.

Contact our specialists

Why not find out how we can help you overcome your key challenges and successfully adopt innovative self-checkout and self-service technology in your stores? Our team of over 200 specialists is ready to help you.