Preventing Small Operational Losses
Silent Failures: The Risks Retailers Don't See

By the D&D Daily staff

When retailers evaluate operational risk, attention often focuses on major incidents such as organized retail crime, severe weather or cybersecurity attacks. Yet many losses begin with something much smaller: a process that slowly stops working as intended.

These "silent failures" rarely trigger immediate alarms. A receiving procedure that is skipped during busy periods, an inventory audit that becomes less consistent over time, or a store team that develops workarounds to save time may seem insignificant on its own. Collectively, however, these small deviations can create measurable financial and operational consequences.

For loss prevention teams, identifying these gradual changes can be just as important as responding to high-profile incidents. Many inventory discrepancies, compliance issues and operational errors can develop over weeks or months rather than appearing overnight.

The challenge is that successful processes often receive less attention than failed ones. Once a procedure becomes routine, organizations may assume it continues to function effectively. In reality, staffing changes, new technology, evolving customer expectations and shifting workloads can gradually alter how work is actually performed.

Routine operational reviews can help identify these gaps before they become larger problems. Rather than focusing solely on whether a policy exists, many retailers are placing greater emphasis on whether frontline execution still matches the original intent.

Data can also play an important role. Trends such as increasing inventory adjustments, higher exception reporting, repeated point-of-sale overrides or growing fulfillment errors may indicate operational drift and warrant closer review before they contribute to larger issues.

Cross-functional collaboration is equally valuable. Store operations, merchandising, supply chain, finance and loss prevention often view the same issue from different perspectives. Bringing those viewpoints together can reveal patterns that individual departments might overlook.

Retail loss prevention has expanded well beyond traditional investigations. Increasingly, many organizations view the function as an operational partner focused on identifying risks before they become costly events. While major incidents will always demand attention, preventing small problems from quietly growing into larger ones may deliver some of the greatest long-term value.


Retail Fraud Costs Keep Rising
Study: Total cost of fraud now exceeds $5 for every $1 of direct loss

The cost of fraud is mounting for North American retailers and merchants.

A study from LexisNexis Risk Solutions found that the total cost of fraud now exceeds $5 for every $1 of direct loss in both the United States and Canada, reaching approximately $5.13 in the U.S. and $5.23 in Canada. This marks the first time LexisNexis Fraud Multiplier has crossed the $5 threshold in both markets.

Online and mobile channels now account for most fraud costs, representing up to 83% for e-commerce merchants. Common fraud types include chargeback fraud, lost or stolen merchandise and fraudulent returns, reflecting the breadth of threats facing merchants today.

LexisNexis found that nearly four-in-10 (37%) retail and e-commerce organizations reported significant revenue losses tied to fraud over the past year. At the same time, efforts to strengthen fraud controls are contributing to customer friction, with more than half (56%) of US retailers e-commerce merchants (54%) reporting increased customer churn linked to anti-fraud measures.

Notably, more than two thirds of U.S. merchants reported concern about the fraud risks associated with transactions placed by AI-powered agents on behalf of consumers.

The study found that organizations with more developed fraud prevention strategies are achieving stronger outcomes. For example, 20% of high-maturity organizations reported decreased customer churn because of fraud prevention efforts, compared with 9% of low-maturity organizations.

High-maturity organizations are also more effective at preventing fraud at scale, according to LexisNexis, with 19% stopping 1,000 or more fraudulent transactions per month compared with 4% of low-maturity businesses. chainstoreage.com


Safety Requires Strategic Thinking
Stop Looking for the Next Tool, and Start Rethinking How You Think

Moving from programmatic to systems thinking ensures safety efforts are sustainable and adaptable to changing conditions.

Safety should evolve from a compliance-focused activity to a strategic, resilience-building discipline that emphasizes recovery and adaptability. Leadership must shift from supporting safety initiatives to owning safety outcomes through active engagement and diagnostic questioning.

Moving from programmatic approaches to systems thinking ensures safety practices are sustainable and adaptable to changing conditions. Organizations need to redefine safety as a core leadership responsibility, fostering shared ownership and accountability at all levels.

The next leap in safety performance requires a philosophical change—questioning assumptions and embracing complexity rather than seeking quick fixes.

The real issue runs deeper than metaphor. The safety profession has a pattern. Every few years, a new framework emerges. A new model, a new certification, a new acronym, and organizations adopt it with enthusiasm, implement it with discipline, and measure it with precision, only to find, a few years later, that not much has fundamentally changed. Injury rates may fluctuate, audit scores may improve, but the underlying capacity to prevent and recover from serious events remains largely unchanged.

Activity feels productive; strategy requires confrontation. Activity can be measured; strategy must be reasoned. Activity protects us from uncertainty; strategy demands we sit with it. That distinction matters more now than ever. ehstoday.com
 

OSHA Updates Voluntary Safety Program
OSHA Realigns VPP Core Elements

VPPPA will continue providing resources and mentoring to help sites achieve safety excellence.

OSHA recently announced updates to its Voluntary Protection Programs Policies and Procedures Manual effective June 16, 2026.

Sites participating in OSHA’s VPP will be required to follow the seven core elements outlined in OSHA’s Recommended Practices for Safety and Health Programs.

Changes to the program, including updates to language for Medical Access Orders, and the creation of both VPP Elite and VPP Emeritus levels, are outlined in OSHA Directive CSP 03-01-005.

“VPPPA recognizes that, as part of our collective goal to raise the standard for workplace safety across the United States, the programs we utilize to achieve this must continually evolve,” said VPPPA Chairperson Terry J. Schulte in a statement. “OSHA’s announcement that its Voluntary Protection Program (VPP) will now align with the agency’s 'Recommended Practices for Safety and Health Programs' represents another step forward for VPP and VPPPA members.” ehstoday.com


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