Can You Predict the Future?

In our retail industry, loss prevention is a crucial aspect of maintaining a successful business. For those outside our industry, loss prevention and asset protection refers to the efforts made by retailers to prevent shrink, which is the loss of inventory due to factors such as theft, damage, or errors in inventory management. Shrink can have a significant impact on a retailer's bottom line, as it directly affects the profits made from selling the lost inventory.

At the very beginning of our profession’s creation, loss prevention efforts tended to have focused on being reactive, meaning that retailers only address shrink after it has already occurred. A very after the fact approach. This often involves investigating incidents of theft or loss and implementing measures to prevent similar incidents from happening in the future. While this approach can be effective in some cases, it is limited in its ability to proactively prevent shrink and mitigating other risks. ?You may ask, what are we supposed to do, be crystal ball readers?? Well, the short answer is, yes.?

Given our experience and surrounded by the immense analytical tools and some of the brightest minds we have had at our disposal in the LP/AP industry one would argue that our role as being "predictors of the future" is not too far of base.

From my lengthly experience leading LP/AP teams at some of the worlds largest retailers, the more effective approach is for retailers to adopt a proactive, almost visionary approach to loss prevention. This involves taking proactive steps as mentioned above to identify potential risks and implement measures to mitigate those risks before they result in shrink or other losses. Deploying “think tanks” within your organization is not out of the question.? Getting your brightest minds together to plan and plot a course is much like a high-level international chess match…anticipating the criminal elements next moves and or vulnerabilities is essential.?

The retailer who is quickest to the market with proper defensibility and proactive risk measures is the victor, as the criminal element always seeks the softest target, it is appropriately called the cockroach effect.? Additional ways that retailers can be proactive in their loss prevention efforts is by building business plans that focus strictly on proactivity. ?While leading the efforts at Walmart and The Home Depot, it was a requirement that my directors-built business plans outlining the objectives needed to be accomplish for the upcoming year, as well as a strong focus on “Horizional Thinking”, a buzzword I created that intimated a focus on that which we did not yet know.??It was a way to exercise my director’s mindset to shift outside of their comfort zones and into the task of forward thinking.??? This involves identifying potential risks and developing strategies to address those risks before they occur. ?

Taking it a step further, such things as the anticipation of social unrest events, the scarcity of key and essential products, and the logistics and transportation crisis would create challenges for retailers that need to be prepared for.?Prior to COVID, not many people prepared for the fallout that we experienced.?It changed the entire way we managed retail, and lived our life. Criminals exploited the crisis and are still preying on the weakness that exists.? We are still living lasting effects.?

So, what is the next COVID event??Will it be civil unrest, external threats perhaps war on our soil, large and long lasting natural disasters, a deeper recession or a total financial collapse?? Something is always on the horizon, and it is our jobs to do the very best we can to prepare for the fallout of those events BEFORE they occur.?What will be needed, what procedures will need to be enacted, what tools will you and your team need to be engaging today that will help secure you tomorrow?? It’s a heavy lift, and not something that should consume your departments entire energy, but some thought must be given to tomorrow’s unknown.

Another way that retailers can be proactive in their loss prevention efforts is by looking forward and projecting those future needs. This involves anticipating potential risks and implementing measures to mitigate those risks before they occur. For example, a retailer may analyze data on past theft incidents and use that data to predict when and where future incidents are likely to occur. Look at conducting a post mortem on the COVID crisis and how it effected your company. Then put into play fixes to those mistakes that were made which will be properly implemented the next time we are caught off guard with an external business interrupter. When the time comes implement the pre-designed measures to prevent critical breakdowns from happening. And this is bigger than just your LP/AP division. Become a visionary for your company as a whole. Help leadership understand that continuity planning is key and critical in all areas and aspects of your company.

Breaking this down in simpler examples, a retailer may identify that their store is at a high risk of theft and implement measures such as increasing the number of security guards, installing more security cameras, shelf sweeping measures, deploying an open platform VMS to manage alerts and analytics, as well as implementing more stringent and innovative security protocols.?

Proactive loss prevention efforts can also help retailers reduce the risk of employee and customer accidents. Retail environments can be hazardous, with potential risks such as slips, trips, and falls, as well as risks associated with handling heavy or sharp objects. By identifying potential hazards and implementing measures to mitigate those hazards, retailers can significantly reduce the risk of accidents and injuries.

Overall, adopting a proactive approach to loss prevention is crucial for retailers looking to minimize shrink and other losses and future proofing. By building business plans that focus on proactivity, looking forward and projecting future needs, and implementing measures to mitigate risks, retailers can significantly reduce shrink, prevent crime, mitigate risk, and reduce employee and customer accidents. This, in turn, can help retailers protect their profits, save the company, and maintain a successful business while keeping employees and customers safe and sound.