By Norm Smaligo,
Asset Protection Coordinator, Goodwill Industries of Tulsa
President, Oklahoma Retail Crime Association (OKRCA)

If you’ve been in Retail LP for more than 20 years – you probably remember the old times:

Back before actual POS systems replaced simple cash registers, and before any exception reporting (remember looking through miles of detail tape looking for a transaction?  For you younger people – it was similar to buying one item at CVS).

A time before CCTV was widely in use – and definitely not in full HD color! (OK, I know some of you are still there. I see the “Google Earth shots of Bigfoot” on the news asking the public to identify your suspects.)  Before we figured out how to use the cameras we had to identify inefficiencies that were costing us millions, instead of just thieves that were costing us thousands.

Back when your store operations teams were freaking out over every $5 cash shortage – while refusing to update policies that allowed thousands of dollars in merchandise to walk out the front (and BACK) doors daily.

Before we really developed audits as a tool to drive results, instead of a mission creep checklist that nobody could remember the business justification for?

Now, imagine knowing just how far we have come as an industry – both in abilities and respect – and walking into those same situations TODAY.

That is the situation I found myself in a year ago as I took on the role of creating an Asset Protection department from scratch for a regional non-profit retailer. They knew they needed Asset Protection – but it quickly became obvious that they didn’t quite know ‘why’ yet!

No POS systems on the front end. If they had CCTV it was old, clunky, and pointed in all the wrong places – but that’s OK, because nobody knew how to use it anyway. The registers we have are one step up from an abacus in computing power – and slightly less accurate.

Stores, warehouse, supply chain loss prevention programs that we’ve all come to expect as minimum standards were non-existent.

I spent the first couple of weeks just trying to diagnose the problems I would need to fix. I went undercover in all my stores before I was introduced to anyone, so I could get an unfiltered look at what I was dealing with. Really, I HAD to go undercover. I had no CCTV to work with! My spidey-sense tingled with obvious signs of loss everywhere I looked. Supply chain, warehouse, stores; all wide open (literally and figuratively) for theft.

Some of the more extraordinary things I found:

*Store managers exiting the store, holding a clearly marked bank deposit bag up in the air and announcing to anyone who could hear: “I’m going to the bank!”  They were doing twice daily trips to the bank; once during the day for the change order, and once after closing for the deposit – Doubling the risks of a robbery to our staff.

*Half of the stores had no access control systems in place. They told me they’ve had problems with store personnel helping themselves to product out the back door in the past – but they thought it had stopped (spoiler alert: it hasn’t).

*Managers are called to the registers to approve almost everything – yet, cashiers hand key in every sale price. Since there is no barcoding of merchandise – the odds they were ‘sweet-hearting’ merchandise out the door were almost a sure thing. The retail operations folks genuinely thought there was a 1:1 correlation between what was rang up – and what was walking out the door (as we say in the South: “Bless their hearts….”)

Luckily, I came into position at about the same time there was a new person promoted over retail who had also been to the retail mountaintop previously and had seen the promised land. The problem we had was not ‘what’ to fix – it was ‘what to fix FIRST’. We compared notes, fixed bayonets – and charged!

Some of the sillier policies were corrected immediately. Multiple trips to the bank were stopped – as were cash handling practices that had zero business justification and were downright dangerous – and almost made me have a stroke every time I watched them.  I’m a big guy. I can’t handle that kind of blood pressure spike!

Our store’s physical security was tightened. Locks, alarms and merchandise protection are being standardized. If we can’t stop you from taking your now-secured merchandise through your preferred choice of door, we are going to at least draw loud attention to you doing it.

Real time two-way communication lines were opened between the stores and AP through the GroupMe app. Real or suspected losses are being reported quickly – and the people reporting them are recognized for their attention.  I have also indulged myself and caught a few shoplifters along the way (no ‘scarecrows’ here!). This rippled through the stores in increased awareness and engagement in loss prevention issues – and paid huge dividends for us! The palpable excitement in store personnel in finally knowing that the company took preventing loss seriously, and SEEING IT HAPPEN made it that much easier to draft them to our cause.

CCTV systems were bought and installed.  Strangely enough, in every store we installed cameras – we closed a management theft internal within the first 2 weeks. Every.single.time. The same managers who were present when we installed the cameras were being caught by them within days. It’s scary to think how long they’ve been stealing from us if they still couldn’t stop when they knew they were being watched.

POS Systems, and barcoded merchandise systems are being trialed and will be in place shortly – and will be integrated into our CCTV system. We will finally have a better idea of what is actually walking out the front door – so we can more efficiently bring it in through the back.

Operational inefficiencies have been identified, and corrections developed. Tip: If you really want to shatter someone’s illusion about the efficiency of an operational process, have them watch a recording of it at 8x or 16x speed as opposed to watching it live. The bottle-necks, duplications and wasted efforts will jump off the screen at you! Audits are being developed and continually updated to accurately measure our practices and drive our results. Instead of dozens of ways to do one thing – we now have one way to do dozens of things. “Policy” is now winning out over “preference”.

We’re starting to see the payoff of our efforts through increased sales, lowered costs and closed cases across the organization – and it’s being repaid to us through further leeway to effect more change.

I don’t even remember what I really expected coming into this role, but this has been the most maddening, frustrating, wonderful, impactful, FUN exercise of my career. Haven’t we all at one time or another wished that we could wave a magic wand and remake our department to OUR liking?  I actually get to do that! I didn’t want to be like some leaders in our industry and impose my preferred playbook on them despite their particular needs, but rather to use my experience to be able to craft a specialized solution that worked for them.