A blog on issues affecting Australia's newsagents, media and small business generally. More ...

theft

Shoplifting is theft and should be dealt with as such

Shoplifting is on the rise, not only in Australia but around the world according to published news reports from the UK, UK and plenty of other countries.

Businesses that do not have structured processes in place are more likely to be targeted. Businesses that do not know the cost of this theft until long after it has occurred are likely to be hit the most.

A newsagent I was talking to the other days told me when they caught it as long as they got the items back they punished by banning the shopper from the store.

In my view, the only way to deal with shoplifting, retail theft, is to bring in the police. Every time. No matter the value of the theft.

The more all newsagents in our channel do this the more it is discussed and the less of a target we will be.

Why, and when I say every time, I even mean in the situation where a spouse was found to be the person stealing from the business, to feed a gambling addiction.

There are some good shoplifting prevention / response resources online:

  1. Crime Stoppers South Australia.
  2. Victoria Police.
  3. Tasmania Police.
  4. Crime Prevention NSW.
  5. National Retail Association.

There are plenty more resources than these. Doing nothing is a mistake, which will cost businesses and communities plenty.

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theft

Is shoplifting on the increase?

Maybe it’s just me but it feels like shoplifting is on the rise based on the number of posts on social media by retailers with photos of people in their shop who appear to have forgotten to pay for what they left with.

The Guardian has published a report on shoplifting in the UK. It’s worth a read as it’s written from a street-level journalism perspective, and while it is stories from Manchester, it could be from parts of Australia.

This small corner of Manchester is no anomaly. The British Retail Consortium (BRC) estimates that there were 8m “theft incidents” in British shops last year, costing £953m. The BRC says shop theft is a “long-term rising trend”, with incidents more than doubling since 2016-17. Meanwhile, reports abound of increasing desperation among customers stealing to feed their children – claims promoted by opposition politicians, but strongly contested by many retailers.

I think any retailer would find it interesting.

I have seen limited data and they indicate a rise in shoplifting in local indie retail in Australia. I have see more evidence of employee theft tho.

In a newsagency, the best early indicator of possible shoplifting is the magazine returns discrepancy report. Returns are processed weekly anyway so it’s a tiny step to check the discrepancy. If you notice these, consider spot stock-take elsewhere in the shop to test whether theft is a problem for you.

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theft

Scots College students accused of using counterfeit $50 notes

news.com.au reports:

Scots College students allegedly use counterfeit cash at Double Bay shops
Students from an expensive Sydney private school have landed in hot water after a shop owner accused them of a low act.
Christopher Harris
October 20, 2022 – 7:08AM

Students from one of Sydney’s most expensive private schools have been caught on camera using counterfeit $50 notes in a bid to swindle an eastern suburbs newsagent out of $100.
Despite initially getting away with the alleged crime at Double Bay Newsagency, one student from the $40,000 a year Scots College returned just two days later in a bid to try the same scam again, Daily Telegraph reported.

Video of the original alleged fraud shows three students at the counter of the newsagency as one buys a pen. A second student in a blue shirt asks to swap four $50 notes for two $100 notes and appears nervous as he fumbles in his wallet for the cash.

Nine news also covered the story:

Some mentions of the story label it a prank while others label it a serious crime.

If I had evidence of anyone passing counterfeit currency in my shop, I’d report it to the police with the expectation of a thorough investigation and charges brought based on evidence, regardless of their social connections or the school they attend if they are a student.

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Ethics

Is shoplifting on the rise in Australia?

In 3 different shops in inner Melbourne this week I heard stories of increased shoplifting.

The first is a premium food outlet. They have their meat now in a locked cabinet. They were having hundreds of dollars worth stolen and while their CCTV helped the police with an arrest, they felt they had to take that action.

Another was a charity shop. A staffer there said that it felt like theft had increased 5-fold.

The third was a premium card and gift shop on the high street. The owner is so upset that it’s making them re-think their plans for the business.

Okay, three stories does not make it a trend. But, in each case they said it was noticeably up this year compared to recent years.

I mention it today because several newsagents raised it with me last month, too … that they felt theft had increased in their shops.

I wonder if it is a trend, and if so, how retailers will react. Sure we can post CCTV photos and the like. But thinking about the premium food shop – putting meat – steaks, sausages, chicken behind a locked see-through door  … do we consider that? It feels utterly impractical.

Of course, the first step is to accurately measure theft, through the regular processes around cards and magazines. Those processes indicate theft without extra work. And, for other product categories, a regular spot stock count check could be helpful.

Knowing if we have a problem is the start of finding a solution.

Many retailers do not engage with processes available to them to identify theft. I think it’s because if they don’t have the evidence, it’s not happening. But, of course, it is happening … in every shop. The only think in question is how much?

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theft

Let’s talk about theft in retail

My POS software company as a track record of service=, helping retailers detect and address theft – customer theft and employee theft. This includes work in0-store, with police, with prosecutors and in court as expert witnesses. This new video from a few days ago is designed to alert retailers to opportunities for detecting and addressing theft.

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theft

How to spot employee theft in a newsagency

Theft is a problem in retail. Too often, it is not discovered until after the event, primarily because of a lack of belief that theft is a problem, particularly theft by employees.

One of the best ways to detect employee theft is to look at your business transactional data. Good POS software not only tracks what is sold, it also tracks what is deleted from sales and entire sales that are cancelled, and it keeps this data in a hidden file, not accessible in the usual reporting way of the software.

In my experience, one out of ten times I have received this secret data for a retailer using my POS software I have found evidence of questionable behaviour. Laying this evidence out with video footage, ideally, and employee rosters, a person of interest emerges, or more depending on the video evidence with a money (in the pocket) shot.

I am not going to share here the incriminating keystrokes but I will say they have been court-tested in cases while providing expert witness for the prosecution.

My advice to newsagents and any retailer is to use the theft detection and mitigation tools in your POS software. learn about them. Use them. But don’t tell others what you are doing.

Some retailers think the best approach to reduce the theft opportunity is to lock everything down, making it very hard for people to steal. The thing is, people who want / need to steal will find a way and the harder you make it for them m in a retail setting the harder it will be for you to detect it.

I am not saying tempt them. rather, don’t lock your POS software down, give people reasonable access, and watch what they do – follow the advice of your POS software company on using the data their software collects for you to see if theft could be a problem min your shop.

Cases of employee theft in a newsagency in which I have been involved have ranged in theft cost from $5,000 to $245,000. In every single instance, using the secret tools I have mentioned here could have detected the theft sooner and reduced the financial an emotional impact on the business and others.

If you have read this far, thank you and well done. Most will not, because theft is not an interesting topic – until they are personally impacted.

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theft

Follow the cash in your newsagency

From the moment a customer hands over cash, it should be tracked in the business. Each point of a gap in tracking is a point of possible theft.

This is on my mind today because a retailer colleague recently discovered an employee theft situation where the employee was able to steal undetected for many months because the business did not reconcile daily takings using their POS software. It was a manual process that was not regularly checked again st actual sales and even then, the checking was cursory.

More fool on the retailer for disinterest in managing cash.

The theft would have been stopped or at least seen sooner had they done their end of shift inside the POS software with that data feeding seamlessly and untouched by human hands through to Xero, the accounting software they use. Instead, they recorded cash manually and manually entered data into Xero.

This is a failure of process that was easily exploited by the thief.

Business systems exist to block this.

The more control a business owner exerts on their business by fully using their software and supporting this with black and white processes the less opportunity for employee theft.

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Newsagency management

Shopper theft in local small business retail

Theft by shoppers is expensive for local small business retail. It is a crime committed with ease, as shown on the video footage so often captured. First, there is the browse.

Then, the pick-up of the product.

Next is the smooth hiding.

Finally, the exit having finished “just looking”.

Beyond the cost of the products stolen is the impact on the mental health of local business owners. Shopper theft hurts local retailers far more than they usually let on.

These images are from a video shared recently by a newsagent. In the video, the face of the ‘shopper’ is far more visible than shown in the photos I have shared.

More retailers are sharing video in the hope of tracking down the ‘shopper’. Once they are identified, reporting their details to the police is vital.

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theft

Is theft in retail on the rise?

I have noticed an increase in complaints about theft by shoppers in recent months, so much so that I wonder if this is a wider challenge for retailers.

My information comes from retailers I speak with and small business retail discussion groups I am part of. But it’s not that big of a pool considering the number of retail businesses in Australia.

So I pose the question today: in your business, are you noticing more theft by customers than previously?

While there are steps we can take to mitigate the situation, often they are considered only after a theft experience.

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theft

Magazine theft at Westfield Southland, VIC

Someone broke into the storage cage near our Southland newsagency in Victoria, when no one was around and before we open, cut open bundles of magazines delivered to us and stole almost all of our delivery that was due on sale  yesterday morning.

We have the thief on camera doing this and removing a considerable value of stock.

We have reported the matter to the police and provided the security footage.

It’s clear from the evidence what they were doing and what they were looking for.

Given that the volume stock taken would only be of value to a retailer, we are considering putting the evidence in the public domain. It’s something we are discussing with the police.

I hope the police identify and catch the person involved. We will do everything possible to support them.

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magazines

A fraud alert issued by epay this afternoon

The following notice was issued with this advice: We’ve again become aware of heightened fraudulent activity across our retailer base, where fraudsters are contacting sites pretending to be epay representatives (or sometimes a product vendor, the ATO or other Government Department) and requesting that they print vouchers for predominantly cash products such as VPAY, FlexePIN, Paysafe or Neosurf and to read the PIN code over the phone to them or suggesting they need to provide payment for upgrading their terminal or service with epay – other MO’s include advising retailers they’re paying more for the transactions than they should or that there had been ‘issues’ with some products and they need to print some out to verify if it have been fixed. We’ve also had instances where a retailer was convinced that epay and/or Neosurf was closing down, so they’d been tasked with retrieving all unused vouchers (by getting them to print and read the details overs the phone) so they could be deactivated – these scammers change their story often, so past scenarios are not necessarily a good indicator of future ones.

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Social responsibility

Beware scammers

Several newsagents have told me this week of calls they have received from someone saying there is an issue with phone cards or some other product from their business. They ask to be logged into the computer in the business to fix the issue.

Do not agree to this. It is a scam.

Verify the identify of anyone asking to log into your computer. This is easy to do. Ask for their phone number and say you will call them back. Most will drop off at this point.

Please, tell everyone working in your business. The cost if the scammer getting through could be tens of thousands of dollars.

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theft

New report on theft in retail in Australia

The Age yesterday reported on a surge in theft.

A study of over 9000 Australian and New Zealand retailers has revealed the cost of theft in-store has now reached a “crisis point” for companies as shoplifters have become more brazen in recent years.

While the repor focusses on shoplifting, in my experience working eityh retailers, employee theft has a higher cost. This paragraph is telling…

The majority of respondents were large fashion, grocery and department retailers with 300 or more stores. For the 2018 financial year, those companies estimated crime-related losses of $3.37 billion, or 0.92 per cent of the region’s total retail revenue for the year.

The average cost of theft in small to medium business is 3% and more. This, considering the .92% noted above indicates the focus of the report is narrow. But then the report goes on to say employee theft was 22% of overall theft.

Maybe the disconnect is because the report pulled data from medium to large businesses whereas all data I have seen over the years has been from small businesses, single store businesses. In those, in my experience, employee theft costs around 70% of the total cost of theft.

Regardless of this latest report, theft is retail is a high cost for which retailers, customers and others in the supply chain pay.

read the report. It’s got useful information for any retailer.

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retail

Should we consider armed security guards to cut theft?

Gerry Harvey has called for consideration of this.

“In a lot of our stores overseas, where we’ve got the security people, they’ve got guns on them.

“Now if those kids knew there was a security guard there with a gun on him, they would not have gone in.”

In my experience employee theft is a higher cost to retail businesses than shopper theft. But my data is from indie small businesses. Maybe in Gerry’s stores, people do walk out with washing machines and fridges.

I think the last thing we need is armed guards in retail. But, hey, Gerry loves a headline and he sure got that this week with this pitch of his.

I’d like to see evidence on what is being stolen by store type. This could inform a more educated and less shrill discussion.

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theft

Early engagement by police helps catch shoplifters

While this story is from the US, from the small midwest town of Burlington Wisconsin, it reflects how early engagement by police on social media can help apprehend shoplifting suspects.

Here is their first post and the photo:

Here is their next post with good news about identification:

This story also interests me because of the size of what was soles – large rolls of wire, so big they had to use a trolley to steal them.

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theft

Dealing with retail business employee theft by a minor

If you suspect an employee aged under eighteen of theft from your business you need to be careful as to how you navigate this. It is important to take time to decide the appropriate plan of action before you approach the suspect to even investigate the matter. The wrong approach could have challenging consequences for you, your business and the person you suspect.

My suggestion is that the moment you have a suspicion, invite the suspect and a parent in for a meeting. have someone else there as well, as your witness.

  1. Present your evidence and invite their response.
  2. Ensure you are civil, factual and not emotional.
  3. Listen to their response.
  4. If they ask what you want to do about it, be sure you have a reasonable response ready. If there is agreement on this, move forward.
  5. If there is not agreement on what you propose, or if they deny the theft, you need to be ready with your next course of action. This course of action should be reasonable and focussed on getting to verifiable truth.

If there is agreement that theft occurred and the employee is casual, my suggestion is immediate termination with you paying out what is owed by law. Put it behind you. Never speak of it outside the business. To constantly revisit it, especially outside a major city, can be debilitating.

If there is not agreement, ask they other side what they want to do. It could be that even though they deny it they are happy to walk away from the business. If this is not the case, you could suggest mediation. The Fair Work Obmudsman office could possible play a role here. You could equally suggest that both sides take the matter to the police.

The reality is that once you make a complaint to parents you have to be prepared to follow through, to see the matter to a reasonable end.

My core message today is that handling the suspected theft by someone under eighteen takes care and planning, to ensure that you, your business and the suspect are all dealt with fairly and safely.

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Management tip

Advice on security cameras for newsagents

I heard of a newsagent being ripped off recently, paying more than $12,000 for a mediocre security system for their business that is not ideal for the business.

Here is my advice on buying security cameras:

Much has changed in security camera technology over recent years. Whereas in the past best-practice advice was to install a retail specific security system connected to your POS software, that is no longer recommended.

Many domestic camera solutions are better and more cost effective for small business retailers than those pitched specifically at retail businesses.

DVR (the device that records the video) technology is changing rapidly, making it challenging for integrated systems to keep up.

The connection to your POS software is not important, especially when you consider the cost of systems that offer such a connection.

Myadvice is that you start by considering what you want. Usually, the most important need is a record of what went on in-store – so you can see who did what and when and from anywhere including outside the business.

While security will be a key need, cameras will also enable you to track shopper traffic and this this you can make product placement decisions that drive better business outcomes.

Here is what I suggest you cover with cameras:

  1. Shop entrance. See the faces of those entering.
  2. Shop exit. See the faces of those leaving.
  3. The counter. See who presents at the counter and what the purchase. Plus see staff behaviour at the counter.
  4. Shop floor. Do not go overboard. Better quality cameras will cover more areas and allow zooming.
  5. Rear entrance, if you have one.
  6. Back room, if you have one.

As for cameras, don’t go cheap. Resolution o is key. Buy units that you can control remotely. Wireless is best – if you have good stable in-store Wi-Fi. Wi-Fi means you can save on wiring and easily move the cameras as the needs of the business change – but you still need power. Consider how you want night video to be handled.

When it comes to the DVR, it may be more cost effective to get two. It all depends on the prices available at the time. Two smaller units for 6 to 8 cameras may be cheaper than a bigger unit serving 8 cameras.

Install a monitor in-store to show you are recording.

If you are not sure what you want to do, start with two to four cameras in prime locations. This could cost under $1,000.

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Newsagency management

When an employee steals from your retail business

I was going through some old photos at the weekend and found one from twenty years ago of an employee who stole more than $15,000 from my newsagency.

The photo, taken at a work Christmas party, reminded me of the theft, which I had long forgotten. It was my first experience at substantial employee theft.

The theft was discovered when were chasing an anomaly in end of shift balancing following an unexpected roster change. A pattern of behaviour was discovered. This caused a question to be asked. Within twenty four hours there was an admission of theft over the previous year of $15,000. This was settled with a bank cheque, funded by their parents, and agreement of immediate termination of employment for then agreement that their partner was not advised.

Knowing what I know now, the amount stolen was sure to be considerably more than the advised $15,000. However, the lesson from the situation was far more valuable in that I learnt exactly what they were doing. This resulted in a tightening of the processes as wells changes to the software to make discovering such theft easier in the future.

We’d bee too busy worrying about big theft to notice small theft, $50 or $50 a day.

Back then, in 1997, cancelling sales in POS software was not frowned upon. There were valid reasons you might cancel a sale. Discovery of the theft revealed that it was a common way to steal small amounts from a business that might not be detected in a P&L analysis.

The software was changed and the business management processes I required changed for my shops. It is now much easier to detect theft and businesses that want to block cancel sales can – although, I recommend against this as it continues to be an excellent indicator of employee theft. In fact, the software changes have been on-going in that this first theft experience established my interest in the area and commitment to help independent retailers reduce the cost of theft.

Being stolen from by someone you trust, someone you count as a friend, is gut-wrenching. It can also be a defining moment from which you learn and act, to ensure it does not happen again. That is how it played out for me in retail as well as in POS software development. For that experience I am certainly grateful.

I kept the photo as it is a useful reminder of what a thief can look like.

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Ethics

Advice on reducing the cost of employee theft in retail

Theft is something to be managed in any retail business. Retailers are  stolen from by employees. Good management is about reducing the opportunity for and instances of theft.

Follow this revised and refreshed advice and the opportunity for theft will be lower and the certainty of detecting it higher.

  1. Value employees. Experts say this is the top step to take.
  2. Share information. Often, theft can be driven by a misconception about the profitability of the business. Sharing accurate business performance data can educate against theft.
  3. Do your end of shift through your software and have a zero-tolerance policy on being over or under. Reconcile banking to your computer software end of shift. One business where this was not done was being skimmed regularly for $200 a day.
  4. Change your roster. Sometimes people work together to steal. One retailer found a family friend senior and their teenage daughter stealing consistently.
  5. Check GP by department. If GP is falling outside what you expect, research it further.
  6. Demand the cash drawer be closed after every sale. A drawer left open is an opportunity.
  7. Keep the counter clean. A better organised counter reduces the opportunity for theft as it makes detection easier.
  8. Have a no employee bags at the counter policy. This makes it harder for them to hide your cash.
  9. Beware employees who carry folded paper or small notepads. These can be used for them to keep track of how much cash is in the register that is theirs – i.e. not rung up in the software.
  10. Beware of calculators with memories at the counter. One retail business employee used the memory function to track how much cash had to be stolen prior to balancing for the day – cash from sales not rung up.
  11. If you sell tobacco products, use stock control. Enter new stock as it comes in, scan all sales and only reorder based on what you software says. Every month do a stock take. Popular daily items such as tobacco stock discrepancies are an indicator of theft. Had one retailer we work with been doing this they would have caught their $250 a day employee theft months earlier.
  12. Scan everything you sell. Do not use department keys as this makes it easier for employees to steal since they know there is no trackback to stock on hand. Using department keys is an invitation to steal.
  13. Do spot cash balancing. Unexpected checks can uncover surprises. One retailer needing to do a banking during the day uncovered a $350 discrepancy that lead to discovery of systematic theft.
  14. Check your Audit Log. Look at cancelled sales, deleted sales and items deleted from a sale. Leaving a cash drawer open from the previous sale, scanning items, taking the cash and cancelling the sale is the most common process used by employees to accrue cash they then take from you. Good software tracks cancelled sales and what was in them. This can be matched with video footage.
  15. Setup a theft policy. Put this on a noticeboard in the back room. Get staff to read it and sign up to it.
  16. Do not let employees sell to themselves. If they want to purchase something make them purchase it from the other side of the counter.
  17. Be professional in your management of the business. The more professional your approach they less likely your employees will steal as they will see the risk of being caught as high.
  18. Advise all job applicants that you will require their permission for a police check. From the outset this indicates that you take your business seriously. In many situations applicants who have been asked for permission to do a police check advise they have found a job elsewhere.
  19. Do not take cash out for your own use in front of employees. If they see you take cash for a coffee or lunch some will see this as an invitation.

These steps work – based on decades of helping small business retailers to reduce and manage employee theft.

Theft, employee and customer, costs a typical small / independent retail between 3% and 5% of product sales revenue.  Management attention can cut this dramatically.  It does not take much time. No, it is more about having professional processes in place which everyone in the business follows.

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Ethics

Supplier distress

A wholesaler who supplies a range of small business retailers including newsagents with whom I have never had any contact or commercial engagement called me late last week to discuss debt collection challenges. They have been owed more than $20,000 by five different newsagency businesses, with which I have no connection, for more than four months.

The purpose of the call was to talk through options.

Theirs is a small family business, with annual turnover of around $350,000. They are not strong on credit checks. They prefer to take people at face value. The $20,000 in bad debts is hurting.

The goods were supplied on time and in good order. No credit claim has been made. They know from personal visits that in three of the shops the goods have been sold.

The supplier is contemplating taking action. however, they question the value of the time and cost investment for the relatively small amount in each case.

What was interesting from the supplier was the comment that they think in at least several cases, the newsagents involves moved from supplier to supplier, buying on credit knowing they could not pay and expecting they would not be pursued for relatively small levels of debt. I don’t know if this was the plan of the newsagents in question,. However, it is concerning that the supplier thinks it was.

This small business supplier I spoke with is distressed. They say others are too. This is not good news for our channel in terms of reputation and in terms of supplier strength.  We need successful suppliers. A reduction in number will only hurt newsagency businesses.

I write about this today because the supplier asked me to, to see what conversation follows.

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Ethics

A confronting armed robbery

Staff at newsXpress Silver Sands in Western Australia were challenged in an armed robbery earlier this week. Here is the story of the confronting attack:

I was talking to a local butcher last week. They went cashless around three years ago. They commented that one reason they did this was to reduce the risk of robbery. It is an interesting discussion for retailers to have.

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theft

A Theft Policy is key to reducing the impact of theft in any retail business

Issue this Theft Policy in your business, have all team members sign it and place it is a place where team members can see it every day. Doing this establishes your commitment on the issue as well as your policy and practices related to the issue. Following through on the policy is key for without discipline in this area the cost of theft in your business will be higher than it should be.

THEFT POLICY OF THIS BUSINESS

  1. Theft, any theft, is a crime against this business, its owners, employees and others who rely on us for their income.
  2. If you discover any evidence or have any suspicion of theft, please report it to the business owner or most senior manager possible immediately. Doing so could save a considerable cost to the business.
  3. We have a zero tolerance policy on theft. All claims will be reported to law enforcement authorities for their investigation.
  4. From time to time we have the business under surveillance in an effort to reduce theft. This may mean that you are photographed or recorded in some other way. By working here you accept this as a condition of employment.
  5. New employees may be asked to provide permission for a police check prior to commencement of employment. Undertaking the police check will be at our discretion.
  6. Cash is never to be left unattended outside the cash drawer or a safe within the business.
  7. Credit and banking card payments are not to be accepted unless the physical card is presented and all required processes are followed for processing these.
  8. Employees caught stealing with irrefutable evidence face immediate dismissal to the extent permitted by labour laws.
  9. Employees are not permitted to remove inventory, including unsold, topped, magazines, unsold cards or damaged stock from the store without permission.
  10. Employees are not permitted to provide a refund to a customer without appropriate management permission.
  11. Employees are not permitted to complete sales to themselves, family members or friends.
  12. Every dollar stolen from the business by customers and or employees can cost us up to four dollars to recover. This is why vigilance on theft is mission critical for our retail store.

PLEASE SIGN AND DATE YOUR ACKNOWLEDGEMENT:

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Ethics
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