Loss Prevention in Retail – What can you do about it?

Loss prevention in retail

A major ongoing concern for retailers is loss prevention, which is understandable as losses from employee theft, shoplifting and administration errors are costing retailers a large sum of money.

According to the British Retail Consortium, £613 million was lost by retailers, just through crime (this figure does not include additional admin errors that are made).
As a retailer you need to be aware and proactive about loss prevention.

Here is a list of things that can be done to help reduce shrinkage and improve store security.

Give a Clear Message

Putting up security signs that show zero-tolerance to theft whether it is internal or external is a low-cost way to deter potential thieves. Ensure as soon as someone walks into your shop, or staff areas, that the signs are clear and visible, both at the entrance and especially in changing rooms. Make sure that the message is clear, that if they steal they will be prosecuted and be taking a ride in a police car.

Watch and Record

An excellent way of seeing what is going on in your store is to have surveillance cameras installed. This gives you the opportunity to monitor not just repeat shoplifting offenders but also unusual staff behaviour. It provides the evidence to successfully prosecute those that have stolen from your store, be it internal or external theft.

Reflecting on the Situation

Another cost effective way to reduce theft is to install mirrors within the store. They are an effective way to remove blind spots such as corners and crannies which might be blocked by shelving or other fixtures, rendering them not visible to the cashier. Mirrors can give staff the view they need. They can remove the temptation for individuals to steal.


As a retailer you may have a POS (Point of Sale) system which should allow you to set specific user permissions to restrict or allow certain tasks to be completed. It is important you understand who has permissions for which tasks as this is a common source of internal theft. Accountability is important; managers should have to sign off any high risk tasks. Be vigilant of how many void sales are being put through and who is authorizing them as this is a very simple way for staff to pass items to friends and family with no payment.

In Control

Being in control of your inventory is crucial to managing loss prevention. If you do not know where your inventory is and how many items of each product should be where, you are leaving yourself wide open to both external and internal theft. Counting your inventory on a regular basis will identify discrepancies early and will keep your financial records on track. Counting proactively rather than reactively, when inventory is identified as missing, reduces inconsistencies. Starting a count after inventory is found to be missing is shutting the door after the horse has bolted. If you conduct regular inventories then you can avoid the inventory going missing. Use the inventory reports to identify high-risk areas in your store where inventory is regularly going missing. Ensure your staff have a full understanding of where these areas are and how to minimise the loss of your inventory.

The points made above can certainly help in increasing your store security and ultimately reduce your shrinkage. They can also be applied to a warehouse environment. It is important you look at your store or warehouse and identify its unique weaknesses to manage your loss prevention effectively.