Based on the strategic approach, specific solutions are also provided for the specific problems at the two stores. Table: 2.3 Conceptual approaches to stock loss reduction .41 Table: 2.4 Company-wide practices used to combat shrinkage .42 Table: 3.1 Shrink size in Rand & as percentage of tumover.
INTRODUCTION
WOOLWORTHS HOLDINGS
Woolworths Holdings Limited is an investment holding company listed on the JSE and has two major trading subsidiaries, Woolworths (Proprietary) Limited and Country Road Limited. Country Road Limited offers a leading clothing and home brand in its own retail stores, major department stores and specialty stores and is listed on the Australian Stock Exchange.
CRIME PROBLEMS
Shrinkage is categorized depending on the intent and 'proximity' to the retailer of the people causing it. The implementation of the results of this research is expected to reduce the losses caused by shrinkage.
LITERATURE REVIEW
Delivery errors include a combination of the wrong products being delivered to the wrong place at the wrong time. These factors together with the psychological thought process of the offender and the circumstances of the retail environment lead to either the omission or the commission of a theft offence. They have a good knowledge of the security system of the store and will undertake a previous study about the retail store before stealing.
Previous study helps these professional offenders evaluate the weaknesses and strengths of the retail security system. At the retail level, availability is important in terms of the accessibility of 'hot products' to thieves. Availability can also be expressed in terms of the visibility of objects at the point of theft.
The loss prevention department could be organized according to the following three alternative forms. According to the Quebec Retail Security Report 2001, 89% of all survey respondents in Quebec claimed to have loss prevention programs, while 11% of respondents said they had no such programs. The project group's activities are best directed if the answers to the above questions are carried out in a satisfactory manner.
Out of the four main causes of shrinkage, the main problems are losses caused by employee and customer theft. In South Africa, a survey has not been conducted to evaluate the relative contribution of the causes of shrinkage.
CASE AND DISCUSSION OF FINDINGS (CHECKERS)
- SHOPRITE GROUP HISTORY
- PHILOSOPHY
- THE GROUP
- CUSTOMER PROFILE
- MARKET STANDING
- CORPORATE DISTINCTIONS
- INFORMATION TECHNOLOGY
- SUPPLY CHAIN MANAGEMENT
- OUTLOOK
- CHECKERS
- CAUSES OF SHRINKAGE AT CHECKERS
- SUPPLIER FRAUD AT THE CHECKERS STORE
- RETAIL CRIME INCIDENT AT CHECKERS
The store does not have a loss prevention department and the annual sales for the store are R30 million. According to the store manager, this method is applied because it is in line with the Generally Accepted Accounting Principles (GAAP). To minimize trade-in theft, the store only stocks a small number of the items most commonly targeted by offenders.
The point of sale (PaS) sensor recognizes the barcode on the outside of the package, but cannot identify the products inside; Shoplifters can walk out of the store with the stolen items. But according to the store manager's information, 10% of expenses are payroll and benefits, 70% are contract services, and 20% are training programs. The store manager believes that developing software (database) solely for shrink purposes does not justify the costs.
The store uses test buyers and their input is crucial because they test the integrity of the staff and the effectiveness of the control systems. The store manager believes that knowing the behavior and integrity of employees is of great importance. Mystery shoppers also test the effectiveness of the store's designated control systems.
CASE AND DISCUSSION OF FINDINGS (WOOLWORTHS)
FOOD
In the food department, the company's growth is continuously increasing as it captures a significantly larger share of the market. Driving this growth is better availability at the end of the day and the increasing pace of the 'good food' journey, underpinned by their continued commitment to innovation and continued passion for good quality. General market awareness of Woolworths providing financial services increased significantly over the year.
As most of the goods are made in South Africa, the local garment industry really benefits. To support this international development, Woolworths has established procurement, supply chain and marketing capabilities that will enable the Woolworths offer to be consistently delivered to customers wherever they are. The company has extremely dedicated staff and believes that they are the backbone of the company.
This achievement was a result of a sharper operational focus through the implementation of the operational excellence charter. In 2003, a comprehensive renewal of the IT infrastructure started, affecting storage, people and processes. The firm is making strides in building teams with the strength and diversity that truly reflect the wealth of the country's people.
STORES
Across the business community it is a privilege to have teams of individuals who take real pride in making the 'Woolies difference'. Whether it's designing excellent stores, providing great personal service, installing refrigerators, buying just the right item with the right built-in technology, the people in this company are starting to take charge for themselves.
ANALYSIS AND DISCUSSION OF FINDINGS (WOOLWORTHS)
- LEVEL OF SHRINKAGE AT WOOLWORTHS
- NON MALICIOUS SHRINKAGE
- SUMMARY
Although the damage in most cases is not intentional, it causes loss to the store. In the store under study, the store manager is the spearhead of loss reduction activities. This is due to the customer/supplier relationship of the store and head office; systems and procedures in place also prevent skewed shrinkage reporting.
The operations manager disagrees with the idea that "as the size of the store increases, so does shrinkage." The store is also very careful about employee theft because of the Labor Relations Act and because it doesn't want it to happen. There is no formal mechanism by which a store can share information with other competing retailers.
The nature of the products the store has in stock is not suitable for the use of cables, locks and chains. Store employees understand the weaknesses and strengths of the security system and the store owner has difficulty detecting and controlling them. The store does not have systematic data collection, recording, and analysis tools that can support a strategic loss prevention program.
RECOMMENDATIONS AND CONCLUSIONS
The task of those responsible for combating shrinkage is to assess the problem and find the best solutions to the problem at hand. This can be from the central warehouse on the way to the store, in the store and on the way to the customer. To resolve this issue, the retailer must strictly adhere to the steps in the following chart.
There should therefore be a close relationship between the manufacturer and the retailer, because information about the goods' data (identification) must be given to the retailer in advance. Both the Woolworths store and the Checkers store face all the shrinkage problems discussed in the previous chapters, although the extent of their exposure to the causes of shrinkage varies. Fifth Edition, USA: McGraw-hill. spreading benefits and reducing inventory losses in a retail environment'. http://www.woolworthsholdings.co.za/corporate-.profile/profile.html) (Accessed Feb 2004). http://www.ecraustralasia.org.au/public/lossprevention.html) (Accessed January 2004). http://www.ecr-academics.orgijournalarchive/pdf/ECRJ0202bec.pdf.).
(Accessed May 2004). http://www.eurekapd.orgishoplift.pdf) (accessed Mar 2004). http://www.rdmanager.orgipdf/Market-Link03fall-employeetheft.pdf) (accessed Apr 2004). http://www.homeoffice.gov.uk/crimeprev) (access). http://www.ecrnet.orgi05projects/shrinkage/auto_id_and_Shrinkage_whitepaper.pdf) (accessed January 2004). (Accessed January 2004). http://www.ecr-academics.org/journal/archive/index.html) (accessed January 2004). http://crimeprevention.rutgers.edu/crime/emp_theft/sales_flooryrevent.htm) (accessed January 2004). http://quintessenz.org/rfiddocs/www.autoidcenter.org/media/ibm_nov_board_meetings.pdf) (Accessed Feb 2004). http://www.phoenix.gov/safebiz/shoplift.html) (Accessedlun 2004). http://www.homeoffice.gov.ukJrds/prgpdfs/fprsl12.pdf) (Besoeklun 2004). http://crimeprevention.rutgers.edu/resources/publishers.htm#perpetuity. (Visit lan 2004). www.easyinfo.co.za/htm/custom/security/retail.htm) (Accessed Feb 2004). http://www.securitymanagement.com/library/Hayes_Loss0203.pdf) (accessed Apr 2004).
Appendix A: Loss prevention solutions
Procedures and routines
Leakproof Product Monitoring Procedures: Used to identify qualified theft of high-risk products. CCTV cameras monitor the stock of high-risk products on the shelves. Adequate product location strategies: This approach locates high-risk products in an area of high visibility and control during storage and in the sales floor. Designing a crime program: using modern techniques to ensure that thieves cannot go undetected, cannot easily steal large quantities of high-risk products, and cannot hide inside or outside in any part of the building.
Fake display cards instead of high-risk products: professional copy of the product with signage that clearly explains to customers how and where this product can be picked up and paid for. EAS hard tag (recycled): Radio frequency, Acosta Magnetic or Electro Magnetic tags placed on high-risk products by employees to raise the alarm if the products are removed and not purchased. EAS soft tagging (available): Radio frequency, Acosta Magnetic or Electro Magnetic tags placed on high-risk products by employees to raise the alarm if products are removed and not purchased.
EAS Origin Marking (Disposable or Recycled): Acosta radio frequency, magnetic or electromagnetic tags placed by manufacturers on high-risk products to trigger an alarm if the products are removed and not purchased. It usually focuses on high-risk product groups, but may eventually expand to all products. This could also extend to external events that are known and reported by customers in high-risk locations.
