How to prevent your staff stealing

Is staff theft and fraud affecting your profits? Find out out how to protect yourself, your stock and your bottom line.

Retail crime is an expensive problem for company’s according to a new report by the British Chambers of Commerce which puts the annual cost of crime against business at £12.6 billion – an increase of 20 per cent since its previous survey in 2004. 3,900 businesses were surveyed nationwide and they found that 59 per cent had experienced at least one crime in the previous 12 months. This survey reflect Salgado’s own survey published as Thieving Little Britains.

Jorge Salgado-Reyes, Senior Loss Prevention investigator for Allied Detectives, says that this holds true for most retailers, with shoplifting (external theft) being the most common cause of business loss, followed by staff theft.

The common shrink split is 70/25/5 per cent (external/internal/other) and depending on the type of retailer this is a fairly accurate split of their losses. But according to Jorge internal theft hits a business harder due to the insidious nature of the crime. It is known as “Theft Employee” and is the dark side of Loss Prevention.

Why does it hit harder? Well Jorge gives one example, imagine that you when you get home tonight, you discover that you have been the victim of a burglary. How do you feel? terrible? Then you report it to the police and they investigate it and during the course of the investigation they discover that the burglar is a friend of yours. How do you feel now? Betrayed? So what is the difference between being burglared by a stranger or a friend? The difference is that your friend has abused your friendship, your trust!

Out of a workforce, it is estimated that 25 per cent of your staff will never steal, 50 per cent may steal if given the opportunity, and the last 25 per cent will always steal. In other words potentially up to 75 per cent of your staff may steal if given the opportunity to do so.

When a member of the public steals an item, they are stealing the cost price of that item (i.e. item – retail price £29.99 – Cost price 5.99) while when a member of staff steals £30 from the till, they are stealing the retail cost i.e. the entire £30.

As you can appreciate, staff theft is a very real and significant problem.

According to Jorge Salgado-Reyes, staff theft is a more common problem than retailers care to admit. And breaking through this barrier of denial is crucial to helping businesses reduce their internal losses.

Allied Detectives offers a holistic approach to tackling staff theft including the use of a confidential staff hotline for staff to report their suspicions about other dishonest staff. Reviewing a company’s security and loss prevention procedures, the use of covert CCTV, test purchasing, GPS tracking of distribution fleets, and undercover operatives being entered into the work force.  Ultimately, the question should not be whether you can afford to implement security measures but whether you can afford not to.

Jorge adds: “Don’t turn a blind eye to staff theft, if you accept it, you will be nurturing a culture of staff dishonesty where your dishonest staff teach new staff to steal and you will start to lose money at an exponential rate.

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