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A pound of prevention: clamping down on retail losses should be everybody's business.

Article Excerpt
"Loss prevention isn't a department or a function--it's a mindset." So says John Guenther, director of loss prevention for Heinen's Fine Foods. His sentiment is echoed by the voices of thousands of other committed loss prevention executives employed by supermarket operators across the country. The challenge, they say, is that in the face of growing competition and increasingly complex problems that are sources for losses in the system, efforts to stem the tide are ultimately not going to work unless they become everyone's responsibility--not just that of the loss prevention department.

"Loss prevention has to be addressed throughout the entire organization. Everyone has to live it and breathe it," says Tim Bartkowiak, director of security at Spartan Stores, Inc., a chain of 54 supermarkets and 20 deep-discount drug stores, based in Grand Rapids, Mich. "Within our organization, the motto is 'Share the responsibility.' Everyone can share the responsibility of loss prevention, whether it's the c.e.o, or the bagger."

Bartkowiak's view is catching on with a growing number of supermarkets, indicating that a more holistic attitude toward loss prevention is an industry model for the future.

Spartan and other operators are encouraging more dialogue among all the factions inside their companies, by beefing up training and internal communications. Some are formalizing the effort, with companywide campaigns such as the one at Spartan, which includes quiz cards and loss prevention posters. Spartan is also kicking it up a notch by extending its expertise to its independent retail customers via training and consultation.

Heinen's, a family-owned chain of 15 stores in Warrensville Heights, Ohio, kicked off its own campaign a year and a half ago, as "the first step toward generating awareness and buy-in from owners and executives," notes Guenther.

A total-company strategy for fighting losses must address the major sources of loss today, according to the experts. The most vexing drains on profits are:

* Organized retail theft (ORT)

* The internal problems of employee theft and cashier errors

* Unacceptably high shrink rates in perishables

Supermarkets are assembling an impressive and growing array of technological tools to fight the battle, including:

* Digital CCTV

* POS data mining

* Biometric finger scanning

* Robotic systems that detect bottom-of-basket loss

In short, the loss prevention movement appears to be on the cutting edge of strategic planning for smart retailers.

But putting the promise of technology aside, human assets remain the first and best defense in any loss prevention strategy, say loss experts. Even some technology suppliers agree.

"If you want to achieve true loss prevention with the biggest bang for your buck, do it with your people," says Larry Miller, president of Trax Retail Solutions, based in Scottsdale, Ariz. "Training people and implementing people systems are precursors to [using] technology."

By adapting a collaborative mindset that includes formal training, as well as less formal discussions among the different departments, retailers will not only find that every link on the chain of command helps cut shrink, but they may also discover new ways that loss prevention tools can benefit their specific areas of business.

An obvious example at store level is having a more engaged team of associates. By being more observant of shoppers, store personnel not only deter shoplifting, they also automatically provide better customer service.

Loss prevention tools can also support...