Shoplifting and customer satisfaction - Essay Example

SHOPLIFTING AND SATISFACTION Shoplifting is a serious crime that affects all retail operations. It is directly responsible for theincrease in the price of goods and indirectly affects customer services. Many methods exist to reduce shoplifting, both intrusive such as physical checks of packages on exit and unobtrusive means, such as electronic tagging and closed circuit cameras. The two basic approaches to reducing shoplifting directly affect the customer thereby causing a loss of customer satisfaction or attempt to prevent shoplifting through a systems approach to the problem wherein the fallout on the customer is minimized. The two papers selected for study analyze these issues. The first is a paper by the 'A Small Business Development Centre' (ASBDC) which deals exclusively with reducing shop lifting on the shop floor. The second paper, by the American District Telegraph (ADT) Security Systems deals not only with losses that occur at the retail end of the business i.e. the shop floor, but also addresses other issues such as losses due employee theft and poor procedures, which also contribute to overall losses. All these measures are in the backdrop of ensuring that customer service should not be affected to such an extent as to affect the store's profitability. An interesting fact that emerges is that electronic tagging, the least intrusive measure, is the most effective method to reduce shoplifting losses. Store layout and re-design, which causes a certain amount of inconvenience to customers, has only a temporary effect. Finally, the presence of security personnel in uniform in no way contributes to the reduction of shoplifting losses. Paper 1 - Reducing Shoplifting Losses Shoplifting may not seem to be a major crime, but for many businesses it may mean the difference between survival and closure. The magnitude of the problem can be gauged from the fact that there is one "retail theft committed every five seconds [in the US]", with no store being immune to this scourge. This paper by the 'A Small Business Development Center' (ASBDC) contains "practical advice on how to spot, apprehend, and prosecute shoplifters", while at the same time ensuring that genuine customers are well served. Types of Shoplifters. Shoplifters are normal people of all sexes, and ages, hailing from all social strata. Most shoplifters are amateurs, out to make a quick buck and hence easy to detect and deter. In order to implement suitable deterrent measures, it is first necessary to understand the various types of people that go in for such crimes. Juvenile Offenders. Juveniles account for a majority of all shoplifting cases, usually as a dare or for cheap thrills. Young children feel that no one will suspect them, or if caught, will be let-off lightly on account of their youth. However, shoplifting is often the pre-cursor o other more serious forms of crime and hence should be dealt with strictly. Impulse Shoplifters. This is often the result of a momentary loss of judgement given a suitable opportunity, however fleeting. This is the easiest to deter through simple, low cost methods, since such shoplifters are basically decent people who did not have any pre-meditated intent to shoplift. Alcoholics, Addicts etc. Such types of people shoplift to meet their physical needs. These criminal types are possible more easier to detect, but are also more likely to turn violent if confronted and hence need to be tackled with the utmost caution. Kleptomaniacs. Such persons shoplift due to psychological reasons and can be quite devious. Often they may not even have any use for the item(s) being stolen since it is the act of stealing that satisfies them. Nevertheless, it still remains a crime and needs to be dealt with accordingly. Professionals. Usually highly skilled and difficult to spot, professionals generally look for lucrative items with re-sale value and quick turn-around. If belonging to any organized underworld groups, can be difficult to prosecute, and hence dissuasion through deterrence is usually the best option. Modus Operandi. Shoplifters are of many types and use hundreds of ingenuous methods to ply their trade. While impulse shoplifters and kleptomaniacs are likely to act alone, others are more likely o operate in groups to gain maximum advantage. Working as part of a gang enables some members of the group to create a diversion thereby allowing the actual thieves to carry out their assigned task of stealing the pre-identified merchandise. Shoplifters also have various tools and devices, which aid in the concealment and carriage of stolen goods. Trial rooms are also extremely vulnerable since old garments can be exchanged for new or worn one over the other. Switching of price labels and removing security tags is also a common practice, once again easier to accomplish in the privacy of a trial room. Deterrence. As in the case of sickness, prevention is better that the cure [prosecution]. Key areas that need to be addressed are:- Employee Education. Salespersons need to be trained to detect a possible shoplifter and be on the look-out for tell-tale signs. Large groups should be given a careful look over and waiting customers' acknowledged as this, "pleases legitimate customers while making a shoplifter uneasy". Similarly, customers who try-out to many items or shop in 'off' hours, or loiter around restricted areas could be potential shoplifter. 'Similarly, cashiers too need to be trained to be alert for any mismatch in pricing and to look inside larger packages and boxes for small hidden items. Store Layout. The layout of the store should deter shoplifting through an orderly layout and good lighting. There should be no blind spots that cannot be seen by sales staff. Small high value items should be kept in sealed display cases. Exits should be kept to the minimum and should be manned by uniformed security guards. Protective Personnel and Equipment. Investing in security personnel and equipment pays-off in the long run. Closed circuit television, mirrors, undercover personnel are a must. Uniformed guards also pose a most viable deterrent against the casual shoplifter. Electronic tagging has proved to be most effective in reducing shoplifting. Switching of labels can be prevented through the use of tamper proof or concealed tagging. Each potential shoplifting method has its countermeasure and should be put into effect. Apprehension, Arrest and Prosecution. Notwithstanding the best deterrence, some people will still steal and get caught. Shoplifting charges are difficult to prove in a court of law and a professional shoplifter may even file counter charges of unlawful detention or excessive use of force. That being the case, sales staff should never accost possible suspects but call-in their supervisor who can handle the situation based on its merits. In most cases, a simple but firm approach such as, " I believe you have some merchandise, which you have forgotten to pay for. Would you mind coming with me to straighten things out", is enough to diffuse a potentially serious situation. Professional shoplifters and persons with prior criminal records must be prosecuted to let people know that the establishment is serious about shoplifters. Juveniles need to be handled in such a manner that it makes a lasting impression so that they never steal again. Whether to call the police or their parents is a decision the store manager has to make. Paper 2- Small Business Security Tips: Retail Security and Theft Prevention. This paper prepared by the American District Telegraph (ADT) Security Systems, drawing on information provided by 'The Peter Berlin Report on Shrinkage Control, Store Managers Edition', also deals with security measures that need to be implemented o prevent losses due to theft. In addition to dealing with prevention of losses on the shop floor, this article also deals with losses arising due to employee theft, shrinkage in back areas and through improper policies and procedures. Retail. Supervise the Shop Floor. Measures recommended include being present on the shop floor as much as possible to personally supervise all aspects of the stores operation. During rounds, keep a sharp look-out for any gray areas that could lead to shop floor losses. These could be procedure related, such as unattended price-guns or unlocked display cases; customer induced such as interchanged price-tags or "merchandise concealed [elsewhere] for later pick up"; or employee related such as lax security guards or fitting room attendants not at their posts. Most importantly, employees must be involved in all aspects of the store's operation to cut down on losses. Give Shoplifters an Uneasy Feeling. This involves greeting, and attending to each person who enters the store so that customers know that their presence in the store has been noticed and that their actions are being monitored. Frequently making eye contact with persons browsing on their own is recommended so that customers harboring thoughts of shoplifting are discouraged from doing so. Assigning zones o employees to monitor, especially vulnerable areas, and use of security equipment such as cameras, mirrors etc also considerably reduce losses. Occasionally, making an announcement over the public address system calling for security personnel to attend to an 'emergency' will also deter any shoplifter. Reduce Opportunities for Employee Theft. An aspect that is overlooked is the involvement of employees in aiding and abetting shoplifting or indulging in such acts themselves. In order to discourage employees from indulging in unfair practices, good procedures must be in place such as requiring the presence of at least two employees at store opening / closing timings. Similarly, disallowing / discouraging interchange of employee I.D. for ringing up sales and measures to prevent collusion between two or more employees to defraud the store are a must. Most importantly, a single employee must not be allowed to, "write the sale, ring it up, wrap the merchandise and ship it out of the store", by himself / herself. Daily sales reports and returns must be scrutinized to look for abnormal or suspicious activity. Losses do not occur solely through theft of goods but also due to misappropriation of cash. Hence, close monitoring of the cash till, reconciliation of the cash register with collections and safe custody of bank drop boxes and couriers is equally important. Promote a Theft Free Culture. As evident from the aspects mentioned earlier, more losses could occur through the 'inside' than by actual shoplifting by customers. Hence it is important to ensure an open and honest work environment. While employees must not be treated as crooks, they must be made aware of the "risks and consequences involved in dishonesty so that they may make the right decision for themselves, should they ever find themselves in a compromising position". Encourage Employee Involvement. The performance of the store is directly proportional to the commitment of its employees. A dedicated work-force with an honor code, will greatly assist in establishing a happy work environment which will be evident to customers also and add to their shopping pleasure. In the customer-employee relationship, "Although the customer is King, never treat the customer better than employees". Reduce Shrinkage in Back Areas. Receipt of new merchandise, its inventorying, pricing and regular stock-taking are some of the routine procedures that need to be in place to ensure that losses do not occur at the 'back-end' of the operations. Areas used to keep surplus merchandise must be kept neat and clean and monitored regularly to spot irregularities. Improve Compliance to Policies and Procedures. Procedures exist to prevent losses through all conceivable means. However, these are of no use if procedures are not implemented or rules flouted. Systems and procedures should be "user friendly so that employees are not encouraged to circumvent the system". Senior management offering for inspection their briefcases / packages for inspection while leaving the store will set an example for others, to comply with laid down procedures. Comparison Contrast Both papers essentially deal with the security measures that need to be implemented to reduce losses on the shop floor without impinging significantly on the customer's pleasurable shopping experience. However, while many of the measures suggested might be common, the approach to the problem is quite different. While the first paper by the ASBDC takes a sociological approach to the problem the second paper by the ADT takes a more holistic view. Some of the aspects of convergence and divergence are as enumerated below. Points of Convergence. Both papers emphasize on the importance of supervising the shop floor where the retail end of the business takes place. Alert sales staff and involved supervisors always on the look-out for suspicious behaviour or anomalies in the normal patter of working can nip the problem in the bud. Employee education and training therefore, is as important as actually apprehending shoplifters 'red-handed'. The importance of having proper policies and adherence to standard operating procedures has also been commented upon in both papers. In many cases, shoplifters make use of loopholes / weaknesses within the system, created knowingly or unknowingly by lax employees, to get away undetected. This again is an aspect that concerns employees rather than customers and thus in no way affects customer satisfaction. Security equipment and store layout also goes a long way in reducing shoplifting losses. In fact, a study carried out by Farrington et al, showed that "electronic tagging caused a lasting decrease in shoplifting". Similarly, store re-design also caused "an immediate decrease that was wearing off after six weeks" (Farrington et al). Store re-design might cause a certain amount of inconvenience to customers. Since its effectiveness was in any case temporary, it might be more cost effective and customer-friendly to go in for more security equipment of the non-intrusive kind. Points of Divergence. As brought out earlier, the basic approach of the two papers is quite different. The paper by he ASBDC takes a sociological approach into what are the various types of shoplifters, and recommends its anti-shoplifting measures accordingly to deal with the various types of shoplifters identified by them. Thus while the paper recommends prosecution for the professional shoplifter, a more lenient view towards juveniles is advocated. The paper by the ADT on the other hand, takes a more holistic view. It acknowledges that while losses do occur on the shop floor, losses due to employee theft and 'back-end' losses are also contributory factors. In only focussing on the 'customer as shoplifter' the potential danger of 'employees as shoplifters' should not be overlooked. Accordingly, the measures to reduce shoplifting recommended in this paper cover all facets of a store's operation. Since two of these aspects do not concern the customer at all, it is obvious that losses can be controlled without harassing the customer. While the paper by the ASBDC recommends the use of uniformed security personnel, the ADT is ambivalent on the subject. Whatever be their views, the study carried out by Farrington et al showed that, "the uniformed security guard has no effect [ on reducing] shoplifting". This needs further deliberation as all stores have some sort of visible security. If this indeed is the case, then savings can be effected through discontinuation of this security measure. Funds thus generated could then be used to introduce more cost-effective anti-shoplifting devices.'' Conclusion In the final analysis, good store management is the best method to reduce losses due to shop lifting without impinging on the services being offered to the customer. Stores should ensure proper layout, good inventory control and follow correct operating procedures to reduce losses. Once al these measures are in place, proper customer service techniques can be introduced to further reduce shoplifting losses. It is only this last aspect that involves the customer, the rest being a system issue. The point to note is that in spite of all these measures, visiting the store must remain an enjoyable experience for the customer, else the store will lose its patronage. A proper balance therefore, needs to be maintained between customer satisfaction and reduction in shoplifting losses. References American District Telegraph (ADT), "Small Business Security Tips: Retail Security and Theft Prevention". Retrieved from http://www.adt.com/wps/portal/adt/small_business/learn_about_security/security_tips/wgc=retail A Small Business Development Center (ASBDC), "Reducing Shoplifting Losses". Retrieved from http://asbdc.udr.edn/bizfacts/6009.asp Farrington et al, "An Experiment on the Prevention of Shoplifting". Retrieved from http://www.popcenter.org/Library/CrimePrevention/Volume%2001/05farrington.pdf Read More