Global Retail Theft Barometer 2010

Key Findings from the Global Retail Theft Barometer 2010

The 2010 edition of the Global Barometer covers 42 countries, including the U.S., China, Australia, France, Germany, Brazil, UK, South Africa, Turkey, and India. New for 2010 is Russia, the first time retail crime data has been collected there. They had 1,103 respondents from the largest retail corporations with combined sales of US $874 billion. Checkpoint Systems, Inc. has supported this independent survey.

Key results

* Cover of 2010 GRTB Shrinkage down. One year after the sharp 2009 spike in shrinkage, shrinkage has fallen by -5.6% as retailers put almost 10% more funds into security and loss prevention. Total global shrinkage (stock loss from crime or waste expressed as a percentage of retail sales) cost retailers and the public US$ 107.3 billion, equivalent to 1.36% of their retail sales.

* Global cost of crime per family (household) was $185.59.

* Crime Increased. Shrinkage fell, although crime continued to rise across the world. 31% of retailers declared that shoplifting had increased compared to the previous year, when 41% had found that shoplifting attempts had increased. Note that this proportion is not the increase in net shoplifting but the percentage of store groups affected.

* Shoplifting Impacts. The main crime problem that retailers faced was shoplifting, accounting for 42.4% of shrinkage or $45.5 billion. Retailers were organised enough to prevent the increase in shoplifting from pushing up shrinkage.

But in the US, Canada, and Australia employee theft was estimated to be greater than shoplifting losses. In the U.S., shoplifting counted for 'only' 34.9% ($13.7 billion) of shrink and employee fraud 43.7% ($17.2 billion).

* Employee theft. Disloyal employees accounted for 35.3% of shrinkage or $37.8 billion.

* Internal error and administrative failure (e.g. pricing or accounting mistakes) was 16.9% ($18.1 billion), and supplier or vendor theft and fraud was 5.4% of shrinkage ($5.8 billion). Both these totals had improved over the previous year.

* Numbers of thieves. Retailers apprehended 6.2 million store thieves in 2010, more than the population of many countries with UN membership.

* Global loss prevention costs. An increase to $26.8 billion (0.34% of retail sales) compared to last year's fall of $1 billion. Capital costs including investment in new technology, EAS, CCTV and other security equipment were $8.3 billion.

The most-stolen items of retail merchandise within the 41 countries included branded and expensive products: cosmetics and skincare, alcohol, womenswear/ladies' apparel, perfume and fine fragrances, and designerwear. Other highly stolen lines included razor blades, DVDs/CDs, video games and video consoles, small electric items, and fashion accessories.

Source: www.retailresearch.org

Importance Of Communication in Retail Store.

Confusing and badly timed communications from head office are the last thing disturbs busy shopfloor staffs. Pathetic staff and bad service can often be a direct result of head office’s failure to engage shopfloor staff with its vision. In the current climate, communication between head office and stores is more important than ever.

When it comes to the motivation to achieve sales or to ensure the best customer service, effective communication between head office and staff on the front line is critical because they have to deliver the brand promise that the retailer may communicate externally via its marketing communications.

Of course, the best method is direct and one-to-one dialogue with their line managers. It helps to know how changes impact on them, so by having the dialogue they can ask the questions. That’s the most effective way of communicating. However, in a busy trading environment where shift patterns and circumstances as well as sheer scale of the business can prevent that happening, a retailer needs other methods of communicating.

Its store intranet system that allows content such as store management tool, newsletters and in-store marketing information to be accessed through an internet browser, either in the back office, at the till or a hand-held device. It has enabled store managers to spend more time on the shopfloor serving customers and driving sales. It has also helped to gain a consistent execution of tasks across all stores.

Ensuring a message has been received and understood is vital.

At shop/stores they haven’t got time to read reams of information so it has to be slick.

Choose the way in which we communicate with store teams very carefully depending on the audience. If intend for issuing communication to all store staff it should be done through staffroom poster or newsletter to ensure everyone could receive the message. If the communication is aimed at store management teams this would be done through a store management tool or internal mail service. Even some has their own radio stations it is a channel for staff news, views and dedications, while during trading hours the station broadcasts music and customer messages & on non-trading hours broadcast news for staffs.

Ensuring store colleagues not only listen to you but that you also listen to them means you are one step closer to not only being heard, but understood.

Steps to successful communication

• Purpose or Objective.

Decide if it is to inform, get a response or generate an outcome.

• Message Type & How It Should Be Perceived.

Often retailers know the message they want to communicate, but they don’t tend to give as much thought to how they want it to be received. A communication about restructuring can send out a very negative message, but if it is accompanied by a statement of how this will safeguard jobs in the longer term and make the business stronger, it can limit concern.

• Target Audience & Media Type.

This is one of the great challenges in retail. There are many locations and people of differing backgrounds and seniority in the business, which means there may need to be different levels of communication to address specific layers of the organization. Similarly, change may affect each level differently and the channels of communication open to them will be different too. Management may have e-mail access when shopfloor staff do not, so picking the right message and the right method of communication is vital.

• The Perfect Time.

Of course, sometimes you can’t choose the timing of a message, but where there is some control it is best to avoid times when the business is already implementing a lot of change, such as a new season launch, a Sale, and so on.

Now, no more free plastic carry bags

Consumers are all set to lose the luxury of getting a free plastic carry bag from shopkeepers after buying grocery or green vegetables. They will have to shell out extra money from their pocket for the plastic carry bag.

The Central government on Monday notified the plastic waste (management and handling) rules, 2011, that stipulated “no carry bags shall be made available free of cost to consumers.” The cost of individual carry bag, however, would be deduced by the local municipality.

The new rules, devised by the Union Environment Ministry with the intention of getting rid of plastics chocking drains and water-bodies, will replace the recycled plastics manufacture and usage rules, 1999, which was amended four years later.

Besides discouraging the consumers, the new rule bans using plastic materials in sachets for storing, packing or selling gutkha, tobacco and pan masala. Municipal authorities have been advised to constructively engage rag-pickers to isolate plastic waste from garbage.

Foodstuffs, too, will not be allowed to be packed in recycled plastics or compostable plastics as per the new law. “It is impractical and undesirable to impose a blanket ban on the use of plastic all over the country. The real challenge is to improve municipal solid waste management systems,” said Union Minister Jairam Ramesh.

Plastic bags shall either be white or can be made only with those pigments and colours, approved in the Bureau of Indian Standards. The bags should not be less than 40 microns in thickness whereas under the earlier rules, the minimum thickness was 20 microns. With several states allowing plastic bags of various minimum thickness, it is now expected that 40 microns norms will become the uniform standard to be followed across the country.

Source: DECCAN HERALD, New Delhi.

Cost effective option in POS: A lot can be saved at POS.

Due to recession many retailers are concentrating on cost-cutting measure business are looking for saving every bucks and Open source Point of Sale applications are getting first choice. The development of Linux is one of the most prominent examples of free and open source software collaboration; typically all the underlying source code can be used, freely modified, and redistributed, both commercially and non-commercially, by anyone under licenses such as the GNU General Public License. Typically Linux is packaged in a format known as a Linux distribution for desktop and server use. Some popular mainstream Linux distributions include Debian (and its derivatives such as Ubuntu), Fedora and openSUSE. Linux distributions include the Linux kernel, supporting utilities and libraries and usually a large amount of application software to fulfill the distribution's intended use. Some of the POS systems used in Linux platform are Lemon POS, Tux Point of Sale.

In the same run Future Group India’s largest retailer has implemented the Beetle/iSprint PoS system, as well as its TPLinux in-store open source retail software. The group has already trialled both products at its Big Bazaar hypermarket chain, and said it will now install 6,000 TPLinux licenses and POS systems across other chains such as Pantaloons, Central, eZone, and Food Bazaar for this they has selected Wincor Nixdorf's retail store software and Point-of-Sale (PoS) systems, and will roll out the same across all its formats. The group said that in the pilot, the new systems had helped reduce check-out times by 75%, and overall costs by 65%.

Importance Of Operation Parameters.........Need for calculation.

SITUATION	BASKET SIZE	TICKET SIZE	NET SALE	FOOTFALL	CONVERSION	PRODUCT
1	High	High	High	Ok	Ok	Ok
2	High	High	Low	Low	Low	Good
3	High	Low	Low	Ok	Ok	Good
4	Low	High	High	Ok	Ok	Good
5	Low	Low	Low	Ok	Ok	Bad
6	Low	Low	High	High	High	Good
7	Low	High	Low	Low	Low	Good

Conclusion for the above situations as under:

(1) Sale is high thus no need to worry. Check on Footfall, Conversion, Product improvement will raise the  business to next level.

(2) Reason is Low FF/CONV.

(3) Only low value items selling.

(4) High value items selling.

(5) Product problem.

(6) Only due to High FF/CONV.

(7) High value items selling. But Low FF/CONV.

Low and High here means the degree of variations from Average. There are various interpretations could be made from this parameters here I just want to show the importance of calculation of Ticket Size & Basket Size.

Even if we take the combination to more variables with Footfall & Conversion then it will give more picture of the health of a Retail Store.