theft

I hate hearing about avoidable employee theft in a newsagency. While not all employee theft is avoidable, plenty is. This typically happens in a newsagency where record keeping is not as good as it could be, where all cash brought into the business is not completely balanced against goods sold.

Every cent of revenue in a newsagency ought to be recorded in the newsagency software at the time of the sale and this ought to be balanced back through the P&L to cost of goods, back to supplier invoices or records.

Take lotteries, all instant tickets and online sales ought to be reconciled to lottery sales in the software. The revenue ought to match. If it does;t you have a problem.

Ir is not acceptable to say it is too hard to balance. It is easy to balance when you have people who are committed to serving the business and those who own it.

Too often, business owners who find it too hard to balance later discover theft for which they only have themselves to blame.

Click here to see a seven News report from last night on an attack a few days ago on a newsagency in Sydney.

Now click here for advice from the Australian Federal Police on reducing the risk of armed robbery.

I did this video – How to cut theft in your retail business – for my software for my software company a few weeks ago. It contains non system specific advice on how to cut theft.

I am sharing it here this morning because in the last week I have heard from four newsagents who have discovered serious employee theft problems.

The advice is simple and will work =for any newsagent regardless of the technology you use. Unfortunately, newsagents tend to act only after theft has occurred.

Long Beach police arrested more than 70 people over the course of three days during a retail theft operation. Read the story here and then talk to nearby retailers and your local police about something similar.

We are seeing more reports of retail theft, by employees and customers, in 2014 than in 2013.

It was a customer who first noticed that an employee in a newsagency was short changing sales by ten or twenty cents. Some careful detective work soon revealed that it was being done in the morning, up to the lunch break.

When confronted, the employee protested that they weren’t stealing from the business. They withheld ten or twenty cents from enough sales to get to the $8.00  a day they spent on lunch.

We’re saving for a house and I can’t afford to buy my lunch is what I am told the employee said in justification for their action. And yes, they did say I never stole from you when they admitted short-changing customers. Oh and they never took more than $8.00 a day – they fought that made it okay.

It took a while to get the money shot on the security system, evidence of the employee removing cash from the register and putting it in their pocket – in time for lunch. Breathtaking!

While this is not theft on the scale I have often seen in newsagencies it is as serious and as damaging of the business and its customers.

Newsagents need a zero tolerance approach to theft. One way of driving this involved proper use of your software when it comes to transacting sales and managing change to be given.

Dairy Queen talked this week about the data breach of their systems which provided hackers with customer names, credit and debit card numbers and expiration dates. This announcement continues a sting of such announcements from major corporations, about breaches compromising millions of customer records.

K-Mart discussed their data breach Monday. Click here for an amazing info graphic on breaches by industry.

These breaches are relevant to small business newsagents as a reminder over security arrangements, the risk of storing customer data yourself and the danger of inadequate data you have stored on the cloud. If you don’t understand your risk you need to as you are responsible for your own and customer data.

A newsagent discovered massive theft by accident this week on checking the business numbers. The theft was allowed because the business did not sell items with accuracy. For example, many items were sold through the computer system as you would on a manual cash register. This permitted negative sales by department. The employee wanting to steal only had to do a -$100.00 (negative $100) sale and they could take $100.00 from the cash draw … and that’s what they did, often.

While it is stressful and upsetting for the newsagent involved, the outcome is a direct result of their actions.

Newsagents can cut theft. It starts with good management, following best-practice theft management advice.

Security protection firm Symantec recently published their Internet Security Threat Report 2014. It is a sobering report of the increase in hacking and attacks through websites, email, mobile devices and more. While I am sure it is does not document the full extent of the impact of digital attacks, what it documents is frightening.

This report and others like it are a reason more and more people are wary of handing over private information for things like loyalty programs. It is a reason companies collecting personal data need to commit to the security of the data they collect and to follow through the commitment with appropriate investment in protecting the data.

The report is also a reminder to newsagents about the importance of proper security protection on all the computers you use.

How cigarette stock is managed in a newsagency provides an excellent indication of the employee theft risk. If a business does not track all movements of cigarette stock it is more likely to be victim of employee theft.

I choose cigarettes because tracking all stock movements is easy and because cigarettes are often stolen by employees if they think sock movements are not being tracked.

Do you track all cigarette stock movement? If not, why not? Tracking it shows your employees that you are serious about an accurate stock count. It also helps you order more accurately and thereby not over stock. It also quickly identifies any discrepancy in stock on hand.

I have seen businesses where there was no tracking of cigarette movement, stock was stolen and plenty of cash was stolen because the criminal employee know that management of the business was weak.

My experience of uncovering and tracking employee theft in newsagencies and assisting police and prosecutors is that a business introducing and maintaining tight control on cigarette stock movement will reduce the incidence of employee theft.

Why newsagents would not do this is beyond me.