Seasonal checklist of items to increase sales and/or help with inventory

  How many times have you caught yourself in a conversation with another manager or a supervisor discussing a seasonal merchandise question or an inventory preparation question and found yourself saying, “I think we did it this way” or “ It seems to me customers were buying such and such last year”? It can be frustrating, especially when the discussion may influence whether an item should be carried or if it was carried the prior year was it a flop? The same thing happens with inventory. Did we start prepping 5 days out? No? Maybe it was 3 days out. Having checklists can make these conversations fewer in number and improve productivity as well as sales performance.

     How do you get those checklists? There has to be a starting point and that is going to be a brainstorming session with the management team. If you have no empirical data saved from the past year you will need to begin anew and then establish a baseline for what information you will collect over the next year. Planning will be easier and you can modify your checklist at next year’s planning meeting making adjustments based on what worked and what didn’t work (you may even call it a “What Worked/What Didn’t Work” session. Begin this season start listing the things you have done to prepare for this year. Here is a short list of some of those things you might consider placing on that list:

  • What seasonal merchandise did you bring in? Sunglasses, coolers, flip-flops, swimwear might be items some of the items you normally would not carry but added to your store in April or May. If you carry groceries you may have added more sports drinks, cold desserts or traditional summer favorites such as watermelon, cantaloupe, corn on the cob, or apples. Maybe you tried some vendor suggested drinks in your front checkout lane coolers. List those items and keep track of your sales for them.
  • Where is your product placement for new/seasonal items? Have you set up new fixtures? Did you have fixtures stored and if so where did you store them? It is important to sketch these things out. If a change in personnel takes place by next year someone should be able to pull out those plans and understand them assuming those plans worked and incorporate them in next year’s checklist.
  • If you have brought in new seasonal merchandise, what did you do to make room for it? Did you relocate other goods to a stockroom? How did you do that and where did you place it? Map out where goods are stored in the stockroom so your team can replicate it next summer.
  • Did you change or extend your hours of operation for the summer to increase sales? If so you need to review the sales data and determine if those extended hours truly helped increase sales. When did you start the hours and when will you resume standard operating times? If extended hours did not make a big difference don’t rule out the strategy until you take a look at how you advertised those time changes. Question results whose outcomes were not what you were hoping to achieve. If you have thoroughly reviewed the strategy and it could not have been improved then discard it. Don’t be afraid to try new things just be honest about results and don’t make excuses if you don’t see the results you expected. Pride can bring down a store quickly.
  • Look at staffing. Did you hire additional summer help and if so, when did you hire them and how many? Prior to deciding to just release them look at your sales information, including dollars per transaction and your total transactions. You may release them this year but keep that information and use it for future planning.

As you and your management team begin strategizing and asking these questions you will find you open doors to more questions that will help drill down further. The more points you can identify the better your checklist will be.

     Once the plans are made, it will be easier to know which numbers you are going to track. You will have documentation that will serve as the blueprints for building a winning strategy that will be a basis for future years. You and your team will find it a less challenging task when it is time to identify and discard losing strategies. Come inventory time or the next summer sales season your store will be ready to roll out a playbook that will make your store a success!

Make Inventory Preparation Fun For Everyone

     “It’s INVENTORY time let’s go have FUN!” There’s a phrase you will never hear. Let’s face it anyone who has been through an inventory knows that it is drudgery. Aside from the counting of merchandise, there is all the preparation that leads up to it. If done properly it is time-consuming and tedious. You and your team are standing on ladders looking on top of fixtures, digging through boxes, in cabinets, and behind fixtures for items that have been misplaced. There is also kneeling to look under gondola base decks, cashier stands or under soft drink coolers for that one little piece of merchandise that rolled under there months ago. Then there are the painstaking tasks that need to be completed such as going through merchandise to make sure everything is properly ticketed. Someone should be spending some time contacting vendors with cut-off dates for bringing in a new product or providing credits for merchandise they are removing. Store managers have to make sure all of the tasks are being planned out, assigning who will complete them and follow up on them. ALL of this is BEFORE inventory night even takes place. Oh did I mention you still have to keep your store operating while you get these projects done? No, it really is not a fun prospect and if your employees get grumpy or dirty and dusty while doing these things they may not be thorough in their assignments. Do your inventory overnight and employees get tired and frazzled and you could wind up having more shortage than you should. Finding methods to get your team on board and keeping them fired up requires making inventory fun.

     How do you make inventory fun and interesting for your employees? There is a variety of ideas store managers can introduce to make the process more engaging for their staff.

  • Almost every business has that one person who is creative and let’s face it super-energetic about fun activities. Find that person, make them your inventory “Fun Captain” and cut them loose. You may even give them a small budget to work with so it is more fun for them too and they feel empowered to make decisions. It will be a load off of your plate. Just be sure that there are brief status meetings you two hold so you can help keep things on track. Sometimes these folks can have grandiose ideas that can be tough to reign in if you don’t stay a little involved.
  • FOOD! Everyone loves food and it can pump up the mood of a team. If you have a “Fun Captain”, ask them to come up with a week of food ideas for each day of prep and inventory night. It doesn’t have to be fancy maybe “Doughnut Monday”, “Candy Corn Tuesday”, “Pretzel Wednesday” and so on, you get my drift. Inventory day should be a bit more special. I have seen everything from fruit, coffee, and soda brought in for energy overnights to sub sandwiches and chips. One place I worked for the store manager brought in breakfast foods at the start of the day and pizzas that afternoon. Be creative!
  • Music. I saw one store that did inventory overnight and since there were no customers they played upbeat music over the P.A. system. Someone from that store would occasionally get on the microphone or phone and pretend to be a DJ. It was lively, it didn’t cost anything and the “DJ” was entertaining and funny.
  • Hold contests. Who doesn’t enjoy being part of a contest? It may be giving a prize to the person who can find merchandise stuck in the oddest location. Maybe it is retail trivia questions focused on shortage and safety issues. A correct answer can be rewarded with a “fun-sized” candy bar. You can purchase those bags in any grocery store and if you sell them then requisition a bag.

There are other ideas you or your “Fun Captain” will come up with, the key is to make it enjoyable for your team. Remember, the more engaged your team is and the more they understand why they are preparing for inventory the better the overall results will be when shrinkage numbers come back.

Stopping Shoplifters Is As Much Attitude As It Is Equipment

We supply and install the best anti-shoplifting equipment made. Checkpoint Systems is the gold standard of Electronic Article Surveillance (EAS) equipment. Support is off the chart. Checkpoint Systems has factory Tech’s everywhere, I mean EVERYWHERE. They have to since the majority of the top retailers in the world are using Checkpoint equipment. These Techs are not sub-contractors. They are skilled EAS, Radio Frequency (RF) experts. As an example, my Sr. Tech Dan is a former Navy Electronics Technician; he worked on highly advanced systems that protect our country.

That’s all good and well but we can install the best equipment using the best people out there but if you do not have the right attitude, you will not have solved your shoplifting problem. You will simply have spent money and felt good about what you purchased but YOUR SHOPLIFTING PROBLEM WILL COME BACK.

You have to instill the right attitude about shoplifting prevention in yourself and your staff. Shoplifters are not afraid of the Checkpoint equipment all by itself. But, they are very afraid of the Checkpoint equipment when it is supported by a trained, knowledgeable staff. The equipment will work. It will notify you when someone tries to steal a protected piece of merchandise. But you have to be on your game long before this happens. Do you know what shoplifters look like? Do you know how to spot them before they steal? You can easily expose a shoplifter in your store with the proper customer service techniques. These skills will not make the shoplifter transparent but will delight your good customers and increase your sales. Good customers love attention, shoplifters hate it.

I believe this so deeply that we at Loss Prevention Systems include free, live shoplifting training as often as you reasonably need it. Staff changes, new manager or supervisor, new employees that are new to retail or your store? Let us train them, free of charge, for the life of your Checkpoint System when you buy it from Loss Prevention Systems.

So you get actual LP training from a former Director of Loss Prevention with over 35 years of experience. FREE!

So if training is the key, why do you still need the Checkpoint System? That is a great question and the answer is simple. The equipment is there to support you when you cannot be everywhere at the same time. Retailers’ biggest expense is labor. If we can keep labor dollars down, we are more profitable. The fact of the matter is that shoplifters seek out and even create situations where they steal when you cannot pay the attention required to spot and deter every shoplifter. By the way, one in ten people that are in your store right now is there to steal from you. That is where the Checkpoint System comes into play. It is working 24/7, does not take breaks, vacations, sick-leave or simply not show up. Checkpoint equipment has a great attitude and is always looking for shoplifters.

Now, what are YOU going to do to change your attitude and start getting the margins from your sales that you deserve? Contact Loss Prevention Systems now and make it happen. Chances are we will actually be able to assist you to begin stopping shoplifters before the system is even delivered and our amazing Techs can install it.

Good Intentions With Bad Outcomes; Retailers Must Prepare For Increased Violence From Shoplifting Gangs

Actions based on good intentions don’t always have good results. One of the most famous of missteps was the Coca-Cola attempt to improve its formula and market “New” Coke. The idea was well-intentioned but the public reception was cool if not outright hostile. According to the website INVESTOPEDIA, “ “Classic Coke” returned to the shelves less than three months after it had been retired.” In the same article, they point out that in 2008 the manufacturer of Motrin found out that there was a problem with the medicine not dissolving properly. Reportedly they did not want to “incur the associated negative publicity, the firm sent out secret shoppers to buy the products off of store shelves, which resulted in a lawsuit in Oregon in 2011.” (“8 Good Intentions With Bad Outcomes”, Lisa Smith, updated December 15, 2017). Laws can have the same problems of unintended consequences, helping one constituency while hurting another.

In an article in LPM Magazine, “Retail Crime In Los Angeles”, May 1, 2018, An example of a law that was intended to help “reduce prison crowding in California’s overwhelmed prisons and provide treatment rather than jail time to qualifying drug offenders” was Proposition 47. How could such a program go wrong? Who would not benefit from such a law? Apparently, retailers are bearing the burden of unforeseen consequences in this case. According to the article part of Proposition 47 also converted “many non-violent offenses, including shoplifting from felonies to misdemeanors.” The story goes on to say that shoplifting offense under $950 result only in a citation to show up in court. Inevitably career and habitual shoplifters are going to learn what the lines are between a misdemeanor and a felony and they are going to take advantage of those delineations.

It seems that shoplifting has dramatically increased in Los Angeles as criminals have found that it is lucrative for them to engage in the crime with minimal cost if they are caught. The ramifications that are being felt include increased monetary losses for retailers due to theft-related shrink. Worse, the story states that violent behavior from shoplifters is seemingly on the rise. Danger has always been a concern for retailers and especially Loss Prevention professionals when stopping a shoplifter(s). Now that potentially violent criminals have been released because of the reclassification of certain crimes the stakes are higher. The story points out that gangs are becoming more active in shoplifting. As mentioned criminals are quick to learn and they learn rapidly when penalties for a crime become less severe.

Violence in shoplifting cases is becoming more pronounced and not simply in Los Angeles. A story on by the reporter, Michelle Bandur, Dec. 20, 2017, referenced a group of women boosting merchandise from retailers in the Omaha area. Detective Galloway interviewed in the report, “said they don’t avoid confrontation and may resort to violence.” He said they have received reports that these women will, “… load bags in front of employees and sometimes I’ve been told by employees they will taunt them.” He went on to describe incidents of the members of the group knocking people to the floor. They have attempted to run over others in a parking lot if they noticed a person trying to take a picture of their license plate. These incidents support data from the National Retail Federation 2017 Organized Retail Crime Survey. According to the survey, 98.5% of responding retailers reported “ORC (Organized Retail Crime) gangs are just as aggressive or more aggressive and violent when compared with last year. 26.5% said that gangs are much more aggressive than in the previous year (pg. 10). If these numbers from the NRF Survey are true, when coupled with Proposition 47 retailers in L.A. may be in for some very rocky times in years to come.

Retailer owners must become familiar with methods to prevent shoplifting without endangering employees in the process. Tried and true methods such as aggressive customer service may not be effective deterrents any longer. Adjustments by Managers may include carefully reviewing hours of operation and not staying open as late at night. If cameras are not in place owners may want to install them to have quality video and pictures for police in case of a serious incident. Starting a Retail Crime Prevention organization in partnership with local police can help identify theft trends and organized and violent persons. Finally, retail theft prevention training from Loss Prevention Systems Inc. can provide more information on how to stop theft and keep your employees safe from harm.

Prop. 47 may have been well-intentioned but it has opened up a Pandora’s Box of problems for California retailers.  Through proper training, owners and managers can position store teams to be ready for security and safety issues now and in the future.

Reviewing Your Store Policies Today

Reviewing your store policies today and training your employees about the ramification of not following them properly is imperative. The consequences of not following those policies properly are too costly to postpone.  Employees, as they are human, try to use shortcuts or in some instances, take the easy way out while doing some chores without thinking it may affect the bottom line at the end of the day.  Profits for a store cannot be thought of as profits for the owner only, employment and benefits for the employees are inherently tied to those of the owner.  If the owner must close the store for loses, the employees lose as well.

Is it time then to review the policies and procedures the employees must follow while working at the store? You bet.  If you do not think it is necessary to do a complete training workshop today, you must at least remind them of the policies, the procedures, and their responsibility to stay calm and professional at all times. Safety plays an important topic when talking about staying calm and professional while dealing with a shoplifter.  Their safety and the safety of the customers cannot be jeopardized by carelessness or by improper behavior. By reminding them of this important and oftentimes forgotten topic, you are ensuring fatalities or brutal behavior do not occur at your store.

Click here to read about a news story and the fact that many retail shop owners deal with this issue on a daily basis.  The return policies of any store have to be continuously checked and tried to asses their effectiveness, otherwise, you may be dealing with a deficit you cannot recover from.


Inventory Software

Inventory in a retail store can offer the management and the loss prevention team a clear picture of whether their efforts are working or they need to modify something entirely different. 

After a busy day or during the holidays, inventory plays a very important role in your store.  A visual inventory can give you only a glimpse of what is happening, but a true inventory can offer you a real picture, even if it’s more expensive for your store. 

There are many software programs that can aid you with the inventory of your store, and even if that becomes a little costly for you, it will pay to know what’s selling, what is not, and what is being stolen.

A software program will aid you by tracking packages that are being delivered, on transit, items which expiration dates are approaching, and items that are selling well and need to be re-stocked. An inventory software program can help you make decisions that otherwise could take weeks to put in place.  What items to display, or put on sale, which items to have discounted and which items are selling so well you need to put an order in place.

A simple Google search can deliver a list of the most promising software inventory programs that can help you.  Those programs can offer an array of features you may not even know you need, and the companies selling those software programs can offer you pricing for you to compare other programs and their features. Do you know an owner of a retail store that is using a software program? Have you asked them how they like it? If you know someone that is already using an inventory software program, you are in luck.  It can save you time and perhaps money when you decide you are ready to purchase one yourself.

There are many small business owners that own a retail store that has many issues they do not know how to solve. Starting with problems with personnel, management, and loss prevention techniques, the issues can be many and varied.

Address those issues before you buy any software programs to help you with the inventory of your store. What are some of the strength and weaknesses you need to address with the personnel of your store? Is the management team coordinating with the loss prevention team? Is there a loss prevention team? Are they addressing the issues or just pushing them aside for other people to tackle? Not all problems can be solved by buying software or by hiring more employees.  There are many problems that can be solved by being vigilant and by addressing those problems without hesitation. A software program can help, but that is only one key aspect of running a store.

A Checkpoint System Is Now More Important Than Ever

Shoplifters seem to be getting bolder than ever. Much of this is greed. Many people simply want stuff and have no moral compass. Others are emboldened by lax law enforcement or Politicians that pass laws that do little to protect you. Whatever the case be, it has a negative impact on Retailers. We are expected to open our stores, compete, pay employees, pay expenses, taxes…. And make a profit. Shoplifting theft is yet another pressure on us.

The key to stopping shoplifting is prevention! You have to keep the losses from occurring. Once the shoplifter has stolen merchandise, even if you catch them, you lose money in labor, unsellable merchandise, sales and the like. This is where a Checkpoint System shines. This is high-quality commercial grade equipment that works 24/7. However, like anything else, you must get as much value out of any equipment you have. A piece of equipment that can pull double and triple duty for the same investment brings a better return on investment. Consider what Loss Prevention Systems offers.

First, when our customers purchase a system from us, they get FREE anti-shoplifting training for the life of the system. This is live training by a Loss Prevention professional as often as you reasonably need it. I actually spend a fraction of that time on the Checkpoint System itself. Most of the time is spent teaching you and your staff how to detect and dissuade shoplifters from even entering your store. You can actually have fun with shoplifters. Drive them crazy and they will get frustrated and simply leave you alone.

Next, there is a whole world of new innovations in the Checkpoint Systems line. People/Customer counting is one. Your system can count customer traffic. You then receive a weekly report that details your traffic by the hour of the day, day or the week. This data can be merged into your sales data to give you a more complete picture. Customers use this data to help with decisions on staffing levels, open/close times and more. The system will also report on the Checkpoint System alarms. How and when they occur. This further feeds into your decisions about staffing levels. You may say that my cash register tells me traffic. Not so, as not every customer that comes into your store makes a purchase. Why is that? Possibly because you do not have enough staff on at the times when you really need it.

How about remote control of your Checkpoint System from your mobile device while inside your store? This feature notifies you of alarms, maintenance issues, and real-time stats. You can be in your office, stock room or anywhere in your store and the system will notify you of an alarm. Immediately. This also gives you control of the system itself. Checkpoints systems are already ECO-friendly in their power consumption. But you can set up a schedule that tells your system to power down during the hours you are closed. Over a year that money adds up.

Marketing? Our systems have AD Panel capability either built-in or as an add-on. The antennas are there at the front door anyway, why not have them greet your customers with signage that you can change out as often as you wish. Promote an item, a sale, a special or simply say “welcome”. Print whatever you want and slide it into the clear acrylic frame. Now you get double duty without taking up any more floor space.

How about control of items you do not want to leave the store under any circumstances? Key rings, customer hand baskets, notebooks, documents, tools, equipment or supplies. Simply put a tag or label on them.

Contact Loss Prevention Systems today and we will help set you on the path to higher profits!

Keeping Track of Sales And Customers This Year For Next Year’s Summer Planning

It is hard to believe but summer is almost here! What are you doing about it? As crazy as the question may sound there is a reason I ask. What are you doing that will be different than what you did last summer? Do you know what it was you did to inspire additional sales last year? Maybe you didn’t do anything at all differently. Maybe you added a new piece of summer merchandise to your merchandising strategy. How did that item do in sales? Was it a blockbuster for you? On a similar note, how was the customer foot traffic in your store? Did you see an increase in the number of patrons last summer over the rest of the year? If you aren’t asking the questions then you are probably flying by the seat of your pants and that is not going to be beneficial to you at all. Sales tracking and Customer Counting can assist you in exponentially growing your sales.

Adding products to your merchandise lines may be a good idea. Perhaps last summer you purchased 100 units of a new brand of suntan lotion to supplement your summer lineup. Did you keep track of how many of those units you sold at full price? Did you wind up taking markdowns on them in order to get them to move? You may have eventually been out of the merchandise but if you were not tracking how many you sold by the week you may have lost money if they all went at the end of the season at or below cost. By failing to follow sales of seasonal items you could develop a false picture of how a product moved and make the costly mistake of carrying it again the following year. One aside to this; be sure that seasonal merchandise is in a prominent location. Sticking this merchandise on a back endcap or in the main run is not going to produce the results you are seeking. This can also give you a poor picture of how the item could really have driven sales had it been in a more visible location.

Customer foot traffic is also an important tool for summer planning for the next year. If one of your intended purposes in adding a summer product line in your store is to drive up sales you need to know whether it has the intended effect. If you are keeping track of customer counts you can determine if a new product is drawing in more shoppers. A spike in customer counts can be compared to sales tracking of a new product(s). If there appears to be a correlation in the data you can make preparations for the next summer and plan for additional sales by bringing back those summer items. If a group of summer products proved profitable and drew in more customers then add to it with new summer goods. It would also be a good idea to review those sales figures and add more people on shifts. You may find that customer counts proved to be much higher than sales transactions were. If this is the case it is possible that your store could have lost sales by having insufficient cashiers or sales floor staff to provide assistance. Customer counting can also benefit your store with a breakdown of the time of day patrons were shopping. This provides flexibility in adding staff at peak times rather than adding people for an entire day if it isn’t necessary.  Though it may take time to plan it out using the information you have collected from sales tracking and customer counting the payoff will be seen in sales increases.

A website,, had an article, “45 Planning Quotes To Help You Reach Your Goals” by Steve Pogue. One of the quotes was from Warren Buffet, “Someone’s sitting in the shade today because someone planted a tree long ago.” Another quote attributed to Robert H. Schuller, “Spectacular achievement is always preceded by unspectacular preparation.” So friends, spectacular sales next summer will be dependent on how much preparation you are willing to put into planning today. Dedicate time now in reviewing your seasonal specialty item sales and how many customers entered your business and create a plan that will dazzle you with results next summer.

School’s Out – Time To Get Ready For School: Tips To Prepare for a Successful Back To School Season

Summertime is here and now is the time for children to rejoice and shout for glee as most are finishing up their school year. Put away the pens and paper and lunchboxes and prepare to enjoy the warm, sunny days. No Mr. and Ms. Retailer, not YOU, the children. The moment the schools let out is the moment you should be preparing to roll out the merchandise for the next school year. Wait too long and you will be a step or two behind your competition.

Certainly, most children will not be anxious to go school shopping so soon after starting their vacations but we, the dads and moms out here, are always looking for special sales and deals that will save us a few bucks. Education may be free but all of the accessories are not. Think about what we parents are purchasing to send the kids off to school. We are asked to provide crayons, pencils, pens, glue, and paper. Lunchboxes, backpacks (wait, regular or see-through?), binders and notecards also fill our school supply lists. From there schools and grades may have varying requirements. The retailer who is going to be top of the class is the one who will anticipate the needs of the pupils and parents and prepares accordingly.

What are some of those things that you can do to get the head start that will drive sales for your business?

  • If you aren’t keeping old school supply lists filed away, start doing so. This will give you a good idea of what teachers will probably ask parents to provide the coming year. The schools will probably not make lists for the coming year available until July so knowing last year’s information gains you some advantage.
  • Advertise. Use social media and in-store flyers as cost-effective means of getting the word out to customers. You may also want to check on the price of a radio spot to air a short commercial. If you only rely on posting flyers and banners in the store you are limiting your advertising to those customers already shopping with you. You need to spread the message to bring in additional shoppers.
  • Create displays near the front of the store that focuses on school-related supplies that complement each other. For example, create an endcap with binders, loose-leaf paper, pencils, pens, crayons, compasses, and protractors. If your store is geared to clothing then displays for children’s clothing should be on focal points. Regardless of what your store specializes in, order a one-time shipment of some lunchboxes and food storage containers for sandwiches, chips, dressings/sauces. Parents are conscientious of rising school lunch prices and reusable containers appeal to both the cost concerned and environmentally focused families.
  • In the process of creating the displays don’t forget about merchandise protection. Use electronic article surveillance labels and hard tags on everything. Don’t lose sight of the fact that those displays will also attract the attention of shoplifters and they will steal merchandise that isn’t secure. Small and expensive items will be especially tempting.
  • Begin clearance pricing some summer products earlier to free up floor space for back to school related merchandise.
  • An easy to overlook opportunity is to keep your check lanes full of impulse buy goods. Snacks and drinks are top items but finding cool gadgets and pens that may interest students and adults are great opportunities for a few extra dollars.
  • Don’t forget about add-on sale items. Calculators tend to be popular and they need batteries. Peghook your calculators, keeping your high-end TI-83’s, TI-84’s, etc. in Alpha Keeper boxes to make them available to customers while protecting them from theft. Add the corresponding AA and AAA batteries on additional rows of peg hooks and deter theft by using Auto Peg Tags. Speaking of batteries it would also be a good idea to place battery chargers and rechargeable batteries in this type of display. Again, expense minded and green-minded patrons will find something to appeal to them here.

It is not always easy to think outside the box when anticipating the needs of school students especially if your store specializes in one area but it can be done. Be creative and it can pay dividends.

A final thought on back to school sales opportunities. Some retailers offer special deals to teachers (who present official credentials). Not only does this help your profit line it is a huge boon for teachers who often use their own money for classroom supplies. You can develop a new loyal customer base with such an offer. Make preparations early for the return to the classroom and you will demonstrate you have learned your lesson well.


Inventory Over? Scrutinize The Results If They Seem Askew

Some people in retail look forward to it and some dread it. What am I talking about? Inventory! From the planning stages and meetings with the inventory counting team to the actual inventory day it can all be a lot to accomplish even for the best of planners. But what happens when you get through the actual counting phase? What comes next? You wait for the results. You may get preliminary results immediately but for larger stores booked inventory may take several weeks and they have teams to analyze the results. As a small retailer you may have to analyze the reports yourself but do you really understand what you are looking for? Are your results accurate? Stores have to keep track of what they have on hand and owners need to know where shortage has taken place and how it has happened.

A detailed review of the inventory results is important. They can identify areas that may be indicators of poor vendor service. If your store sells groceries, snacks, soft drinks or adult beverages you are most likely served by direct store delivery vendors. If a shortage is somewhat high in these departments you might not be receiving all of the credits you are supposed to receive. This is not necessarily an indicator of theft but it could be. It may be simply poor scanning and crediting for merchandise a vendor is removing from the store. Those credits could be due to product getting ready to expire or that has expired. It may be it was a promotional product that isn’t selling in the quantities the vendor was hoping for. Whatever the reason, the representative could have miscued an entry, for example, scanning a partial pallet of sodas and keying in a quantity of 10 versus 100. If the vendor is in a hurry and no one caught the error at the time it could be costing your store a lot of money.

While we are talking about administrative errors causing shortage it is important that store owners take a look at all of their billings. In a big box retail store, we had monthly P/L (profit/loss) statements that showed the dollar amounts of merchandise shipped to us for each department. One year when inventory results revealed a high shortage result in our shoe department I went back through all of the P/L statements and found an unusual billing amount. I tried to correlate it to a seasonal reset or specific event but was unable to pin it to anything in particular. I sent my concern to our inventory analysts who reviewed the information and found we had been overcharged $10,000 in the shoe department that particular month. Review P/L statements or invoices for potential errors if inventory results seem out of line.

Look at the departments that are showing the shortage. Do they look like areas that would be prone to theft or could there be other administrative issues involved? For example, if you own an office supply store and you have a high shrinkage in printer ink cartridges there is a strong probability this is a theft concern. On the other hand, shrink in foam project boards could be due to process issues. Are individual foam boards shipped in multi-pack shrink wrap? It could be the items are not being separated and a bulk set is improperly sold as a single unit at the register. Have individual units been damaged and unsellable but not properly marked out of stock before tossing them? Foam boards are probably not being stolen but improper handling is costing money to your store just the same.

Certainly, theft has to be a consideration in the review of inventory results. But one must be careful not to attribute ALL shortage to theft. Doing so may keep you from impacting up to 26.7% of your losses in the next inventory cycle. According to the 2017 National Retail Security Survey, 21.3% of a shortage is due to administrative and paperwork errors and 5.4% is the result of vendor fraud or errors. That said it is important to dig into potential theft concerns that are impacting your store. Are you the target of shoplifters? Do you have an employee theft problem you did not realize existed? Getting a handle on theft must be part of your follow-up in creating a shortage action plan to improve shrinkage. Consultation with Loss Prevention Systems Inc. is a good starting point for finding a solution to all of your shortage concerns, theft included.

 If you take inventory and find you are missing SKU’s because results are askew, take time to dig into the findings. Knowing where shortage happened this year and taking steps to correct it will give improved results next year.