Thanksgiving has arrived, marking the true beginning of the holiday season. As stores and restaurants see an increase in customer traffic, it can get very hectic and stressful for both managers and employees to service the surge in patrons. Year after year, companies have to deal with the harsh reality that shrinkage occurs at a higher rate during the holiday period than during the rest of the year, often causing a significant decrease in bottom-line profits during the peak season for the retail sector.
According to The Volumatic Kount U.S. Retail Fraud Survey, conducted in 2013, retailers in the U.S. lost over $54 billion in total shrink (inventory and cash lost as the result of employee theft, shoplifting, vendor fraud and administrative error). Shockingly, over 40% of that total shrink was a result of internal theft. During the holiday season, more than at any other time, employers should be wary of theft and should review existing policies and procedures regarding Loss Prevention and Asset Protection.
Why is employee theft higher in the months of November and December?
There are several reasons as to why employees might have a greater incentive to steal during the Christmas holidays:
- General increase in business traffic makes it easier to steal without the theft being noticed.
- Overall increase in financial pressure during the holidays can burden employees.
- Managers are often preoccupied and their attention can be more easily diverged.
- Increases in seasonal employee hires usually equate to employees who are less loyal to their employers than are full-time workers.
How do employees steal?
Employee theft can occur in many forms. One of the more popular techniques is in the form of internal cash theft. Often, retailers trust employees to deliver daily and/or nightly cash deposits to their local bank. It is surprisingly easy to steal from an ordinary (non tamper-evident) deposit bag used to transport cash and checks.
For example, once money has been sealed in a deposit bag at the store, employees can compromise the bag’s closure, remove a few bills (or more) on their way to the Bank and then reseal the deposit bag without leaving any signs of tampering. If there is no evidence of employee pilfering left on the bag, then theft becomes difficult to prove, and the result is usually a costly investigation.
What can Managers and Companies do to prevent employee theft?
The use of a true tamper-evident security bag can effectively decrease or eliminate theft during the transport of cash from the retailer to the bank. When using a deposit bag with tamper-evident security features, the risk of theft occurring during the transport of said valuables can be significantly reduced. This type of security system also acts as a deterrent for would-be thieves, making them think twice before attempting to compromise a sealed deposit bag. Often times, deposit bag manufacturers will market their products to the retail trade as tamper-evident, when in fact they are not.
Security features of a true Tamper-Evident Retail Deposit Bag should include:
- Indication of heat or cold-based tampering at temperatures ranging from -60°F to 160°F.
- VOID graphics appearing on the adhesive when peeled or manipulated.
- Serrated-edge closure system to promote fracturing in the event of tampering.
While eliminating employee theft completely is unrealistic, certain procedures and precautions can significantly improve security and reduce risk of theft for companies in all industries.
What type of theft is most common in your Business?
NELMAR wishes everyone a very Happy Thanksgiving!
