Thinking Differently About Product Theft – Week 7

In our previous article, we covered how product waste contributes to higher costs for both customers and businesses alike. But waste isn’t the only thing that has a negative effect on these two parties: theft does as well. A recent study by Retail Knowledge estimated that US retailers lose $60 billion each year because of theft. Aside from being an absolutely staggering number, the repercussions of such a fact mean that honest people end up paying for that $60 billion through higher prices and reduced profits. And while every business owner would love to have a team of security and police on hand at all times, the reality is that very few companies can afford these services. If we think differently, however, there are other ways that managers can help reduce theft at a fraction of the price.

Good company culture can fight internal theft

When people love their job and are engaged, they won’t be as tempted to steal. Unfortunately, many of the employees in the workforce are not engaged. In fact, Bob Kelleher claims that seven out of ten employees are unengaged at work, which can lead to them actively undermining and even working against the company. In their eyes, theft may seem justified because of how they feel about the business. This poses an incredible threat to the health of the firm and an even more incredible responsibility to the managers. The good news is that the answer to this problem is simply the opposite of the problem itself: good company culture. Managers should actively work to build engagement and lead by example. Enthusiasm and negativity are both contagious – it’s up to us which one we want to spread.

Compensate for external theft by building loyal customer relationships

A store that is solely focused on catching crooks will most likely not spend as much time treating the real customers right. As a result, even if the theft level goes down, it’s possible that more paying customers will also never come back – which could result in more lost profit dollars than the theft was taking away. The key here is to find a balance between the two so that providing excellent customer service doesn’t suffer because employees are consistently critical of people in the store. With the correct methods, customer service will be boosted while shoplifting will decline. One way of doing this is making verbal contact with every customer who enters the store. Good customers will appreciate the gesture, while shoplifters will become uneasy and even give up stealing altogether.

Be consistent with your anti-theft approaches

 

Once employees and clients understand that theft is taken seriously by the business, the chance that either group will take something declines. But consistency is key. If only part of the management team views theft as a serious issue, employees and customers could strategically wait for the other managers to be on duty so that they can more easily exploit their situation. In the end, it comes down to this: Build an environment that encourages the best in employees and customers while establishing firm and consistent rules of conduct for everyone who enters the building.

What did you think? Leave some feedback! :)

5 thoughts on “Thinking Differently About Product Theft – Week 7

  1. Austin,
    Another great post about why treating employees well can have impact on the bottom line. Over the years I’ve seen people take things from a variety of businesses because they thought they were entitled to them – translation I do not get paid enough or they don’t care about me so I’ll help myself. I believe the lack of culture within a company creates this type of attitude-when people feel like numbers and are not personally vested in the company. Vested by the way they think about their job not how they are paid. I once heard a manager say to an employee “you work like you own this place” (which they didn’t). The employee replied “I treat every company like I own it-it takes care of me and my family why wouldn’t I.” Perhaps creating a culture of caring about each other and the business can help eliminate internal theft.
    Cece

  2. Hello Austin,
    I feel the answer to less theft is employee appreciation. If you give them appreciation and act or rely do care it makes a big difference. May them feel like family who watch out for each other. Having some lunches for all bring a bonding that can help.
    Now if you do catch someone who truly stole from you I see company’s just shuffle out the back door and quietly announce that person is no longer with us and good luck. I do not agree with that. I feel they need to be shone out the door for all to see and to be shamed, shunned or something to make others think OH NO, I would never want that to happen to me.
    So many employees just do not think its a big deal. Its only $10,00 in value or $50.00 but at the end of the year that adds up.
    Mary

  3. Austin excellent post! I am in agreement with you once you make it known that theft is a serious matter and everyone understands the severity of the offense you will be better off in your business. Yes consistency is a key component to establishing a firm hold on your challenge. From a police officer eyes theft is never tolerated , and once you find someone that has committed this acct that should be prosecuted.

  4. Another great post, Austin! Theft hurts the honest people left behind, that’s for sure. You gave us some great things to think about and incorporate into our normal business activities. And, you are right you have to make your employees and customers aware of the severity of stealing and what / how it will impact all of us.

    Great job!

  5. Austin,
    Great post – I definitely believe that once a culture or environment is created; employees will tend to follow it. I believe that once employees know accountablity is important and this message is consistent – now we have created a health barrier.

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