4 Places To Look For Retail Shrinkage
Shrinkage for a retailer can be hard to trace, because it usually happens in small increments over time. If your operations management is not what it should be, it will be more difficult to figure out where the discrepancies are being generated and address the problem.
- Employee theft can be in the form of discount, refund, or credit card abuse as well as actual inventory theft.
- Shoplifting is a close second and includes switching price tags, changing containers, and concealment of inventory.
- Administrative error is always a possibility through pricing mistakes or paperwork errors.
- Vendor error or fraud can happen as vendors stock your shelves themselves.
These issues fall into two general categories – human error and deliberate intent to steal. Both can be counteracted with appropriate monitoring strategies. Loss prevention is a matter of figuring out what can go wrong and taking steps to keep it from happening. With ChainDrive Operations Management, exception-based logic allows you to drill down to the level necessary to pinpoint the problem. It’s possible because all your data can be accessed and assessed using our integrated database.
Once you identify the source of the shrinkage, it becomes a matter of addressing the problem and fixing the leak. The increased monitoring capabilities of ChainDrive’s highly sophisticated inventory control tool set provides the ability to combine multiple methods and do cycle counts, physical inventories, exception reports, reconciliation, shrink status, activity monitoring, and more. Human errors are reduced, actual fraud and theft are less likely due to increased oversight, and your retail shrinkage is addressed.