Staff theft in Australian businesses

When most people think about the losses that a retail business faces, they think about shoplifting. While the Global Retail Theft Barometer, an international study, shows that for the 2014-15 period in Australia, shoplifting was the biggest cause of retail shrinkage at 39%, employee theft, at 25%, wasn’t that far behind.

Employee theft impacts on your bottom line, so putting in place a few simple retail loss prevention measures can quickly pay-off.

Employee theft impacts on your bottom line, so putting in place a few simple retail loss prevention measures can quickly pay-off.

So if you are a small business owner, what might staff stealing look like, and what steps can you do to minimise the chance of it becoming a problem?

For most business there are 5 basic types of employee theft that you need to watch out for.

Stock – One of the more obvious ones, loss of stock to staff can happen either from the shop floor, or from storage areas. If stock is being taken before it is entered into your stock inventory, then it can be hard to track, as it will only show as a discrepancy between what your supplier ships to you and what you enter into your own inventory systems.

Cash – A common source of losses, particularly in business where a lot of transactions are done in smaller amounts of cash. This can be as simple as pocketing a small part of the take from the till from time to time, or at the end of the day, through to complicated schemes involving overpaying, in cash, a third party for goods or services and then sharing the proceeds at a later date.

Wages – Often overlooked, but surprisingly common, staff claiming for hours that haven’t been worked, or for expenses that aren’t really claimable can be a sizeable drain on a small business. The other side of this type of loss is staff that spend large periods during work hours not working.

Supplies – It can be as minor as paperclips or pens, or as serious as furniture, computers or other business equipment. A key time to be vigilant for this type of loss is when staff leave, particularly after being fired.

Information – Admittedly a bigger problem in less retail-oriented business, information theft might involve product data, customer lists, internal communications or details of future plans. With smartphones so prevalent capturing and sharing any kind of information has never been easier.

Retail loss prevention

Minimising employee theft comes down to having the right people, processes and technology in place. While it might all seem a bit overwhelming for the average small business, it doesn’t have to be.

People – The right people is something that most businesses are already well versed in. Hiring the best staff is something that most business owners and managers devote a lot of effort to, but the risk of a new employee stealing is hard to judge. It could be the sole topic of a much longer article, but the basics are contained in the ‘fraud triangle’ which covers a person’s opportunity, motivation and rationale for engaging in theft.

Processes -The right processes are also something that most small business probably already have in place, including stock takes, cash handling procedures, how refunds are handled etc. The difference might be in how often these processes are undertaken, and revisiting them with more of an focus on addressing retail shrinkage.

Technology – The right technology has historically been big one for many small businesses, particularly when it comes to the cost and difficulty of implementing this technology at a small scale. Recent progress in IT and cloud processing has however made thing lots easier for small businesses, both in term of cost effectiveness, and ease of setup and use of various systems.

Business security and CCTV systems are a prime example of an area of technology that have changed significantly for business users.

In the past a business might have had a CCTV system that recorded to video during business hours and could be reviewed as needed, and a security system that they armed when they closed up, the cost and complexity tended to put off many smaller business people. New systems like CleverLoop combine a range of features and functionality with ease of installation and low cost that makes them perfect for all small businesses, and a great tool to help minimise problems with employee stealing.

CleverLoop Camera Security System

CleverLoop Camera Security System

Controlled from a smartphone, CleverLoop provides CCTV functionality that is perfect for monitoring key areas in your premises with security cameras. Stock rooms, counters and tills and the main entrance are all useful places to have a camera recording footage. Being able to access the footage from a phone or computer without halting recording makes referring back to any incidents a breeze.

When you lock up your premises for the day, you leave your cameras recording, and arm the alert system. Should anything happen, you and anyone else you choose can receive alerts direct to your phone, complete with 10 seconds of video footage showing you what caused the alert. You make the call on whether it’s worth calling the police.

Finally, if you are away from your business frequently, but like to be able to check how things are going, you can live-view your cameras from your phone, wherever you are.

So if you are looking to reduce the impact that retail shrinkage has on your business, a smart high-tech tool like a CleverLoop security system can be a big help. See more at CleverLoop.com.au

by The CleverLoop Team
March 6, 2017