If there’s opportunity, internal theft will happen—even at your store. According to a 2011 Retail Industry Leaders Association’s Crime Trends and Leading Practices Survey, 44 percent of responding retailers reported an increase in internal theft. Only 27 percent noted a decrease. Employee crime generally starts small and grows over time as it goes undetected, experts say.
Don’t let staff stealing become the elephant in the store that no one talks about. Read on to learn—and adopt—smart strategies to lessen instances of employee theft.
Loss prevention specialist
Encourage employees to own their success.
Honest employees might initially think that internal theft isn’t their problem. But let’s say a cashier steals $200 out of the till. That’s $200 less that goes to the company. If the retailer offers bonus checks based on store profits, theft ultimately hurts the honest employees’ bank accounts.
Create a culture of honesty.
You might put a poster in the break room that reads: See criminal behavior? Notify your manager. Or set up an anonymous hotline managed by store headquarters or a third-party company. Some retailers offer rewards for reports, particularly if information proves true. The reward could be a flat amount or a percentage of what’s recovered.
Take a strong position against theft.
If word spreads that a thief has been prosecuted, it can deter the employee who is thinking about stealing. For honest employees, it can be validation that they should report crimes and that bad behavior will be punished. They’ll feel better about going to work every day and busting their humps to do a good job.
Lisa LaBruno, Vice president of loss prevention and legal affairs for Retail Industry Leaders Association in Arlington, Va.
Certified fraud examiner
Prevent sliding and sweethearting.
Employees who would never steal may think nothing of giving a coworker a “little discount” at the register. Require that employees go to one specific cashier or through one designated line for all purchases. Cashiers should not be allowed to ring up their family members.
Require a receipt.
After an employee purchases merchandise, standard procedure should be that it must have a receipt attached or be removed from the store. Bagged merchandise allowed to sit in a cooler creates a tempting opportunity—additional unpaid items can be added to the sack during the day. Any partially consumed or used merchandise in the break room, stockroom, office, etc., that doesn’t have a receipt attached should go into the trash.
Install a point-of-sale exception system.
Ensure that the correct amount of money is indeed being collected and that cashiers are not manipulating the register in order to steal. POS systems usually come with basic exception features that can be customized. These programs analyze data against thresholds so you can identify fraudulent transactions.
William Alford President of risk management firm International Lighthouse Group in Charlotte, N.C.
Know the culprit.
Do you have a theft problem? Do you know for certain who’s at fault? A huge part of preventing bad behavior is setting proper expectations. False or over-broad accusations can set the wrong expectations and actually create problems if trust is never built or gets broken.
Reward good employees.
Continually and positively stress the benefits of good behavior in terms that are meaningful to employees. In other words, sell them on doing the right thing. Wages can increase, benefits can be more generous and so on. Telling them they get to keep their job if they stay on the right track is not enough.
If you do have a problem and are quite sure who the offender is, make a quick and public show of the consequences. For example, make an announcement about the situation at a meeting. Tell employees that the offender is no longer with the team because he was caught stealing. That way, there’ll be no doubt about what happens when an employee steals. The good employees will cheer you on, and any remaining bad ones may move on before they get caught.
Jim Hertel, managing partner of Chicago-based retail consulting firm Willard Bishop