Survey shows Canadian retailers are taking necessary actions to combat theft: Retail Council of Canada, PricewaterhouseCoopers
Toronto, June 3, 2008 – With the growth of retail organized crime in the Canadian marketplace, the types of security measures being employed by retailers is also growing according to a new survey of medium and large retailers from PricewaterhouseCoopers (PwC) and Retail Council of Canada.
The survey found that there are many types of criminal activity in retail stores and that the respondents still expect that the most likely source of financial losses in future will come from traditional merchandise theft, both internal and external. The top two identified were merchandise theft from customers (62%) and merchandise theft from employees (33%).
"With a focus on the so-called traditional sources of theft will retailers be prepared to meet the upcoming challenges faced by emerging technology threats? Only 5% indicate that they expect pin-pad tampering to be an issue in the future," says Ian Booler, in the performance and risk practice with PwC in Canada.
Diane J. Brisebois, President and CEO of Retail Council of Canada comments, "It is clear from the survey results that there is a need for government, law enforcement, the courts and the industry itself to ensure we are working cooperatively to deal with such issues as retail organized crime and all other forms of loss that retailers are subjected to."
Currently, respondents to the survey indicate that they are using a wide variety of store security and loss prevention measures to control store operations. On a positive note there is an increasing trend of using technology to help prevent theft-a full 100% of survey respondents use alarm systems and 90% use video surveillance programs.
"These options have become a cost effective measure to monitor store activity — not only for criminal activity, but also for monitoring internal theft and employee security," says Booler. "The presence of video surveillance and alarm system measures are complementing procedural elements: greeters and fitting room attendants working to prevent theft are being assisted by the 'eye in the sky'."
The survey also shows that there is a correlation between the growing use of video surveillance to the increasing rate at which offenders are being prosecuted. Retailers now have the ability to provide law enforcement agencies with the evidence required to appropriately prosecute offenders. Those caught stealing can expect that Canadian retailers will take action. Eighty-five per cent of respondents dismiss employee offenders with cause, 62% proceed with criminal charges against the employee and 80% pursue criminal charges against their customers.
"It is clear from the survey results that retailers are backing-up their policies with the appropriate actions to show the public and their staff that such activity will not be tolerated," Brisebois says
Survey respondents indicate that retailers can reduce their risk of losses by using simple internal control measures:
- 91% perform pre-employment screening before hiring new staff
- 71% rotate employee's duties, where possible, in their stores
- 86% avoid having employees work alone in their stores
- 100% provide training and training materials to employees on store policies specifically related to theft prevention
"It was interesting to see that 48% of respondents said they require new employees to undergo a police background check as part of the hiring process," says Brisebois, "This is a clear indication of the industry's concerns over risks of internal theft residing within today's retail environment."
Although 100% of respondents indicated they provided training and materials to store staff on theft prevention, 86% said they would be interested in receiving additional training information and materials related to loss prevention.
"Retailers are fortifying their control environment," says Booler. "However, typical control measures such as counting inventory are not being performed as frequently as would be expected for a retail market that is most susceptible to merchandise theft. Criminal diversity describes the incredible challenge facing the mid to large retail segment in Canada. Street gangs, technology based crime, and traditional theft must be prioritized to ensure that losses are minimized and shrink rates remain within the industry norms."
Methodology
The survey information was collected and analyzed between October 2007 and March 2008, based on Internet polling, phone surveys and face to face discussions. Information was provided on a voluntary basis. Respondents to the survey included vice-presidents, chief financial officers, directors and managers within the Loss Prevention and Security functions of Canada's leading retail organizations. Owners or other management staff of smaller retail operators also participated in a separate survey targeted at the smaller market retail segment. Information was compiled and analyzed by the Retail Council of Canada in partnership with PricewaterhouseCoopers LLP for medium-to large retailers.
> For more information, please visit www.pwc.com.ca/retail or www.retailcouncil.org.
About PricewaterhouseCoopers
PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 146,000 people in 150 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice. In Canada, PricewaterhouseCoopers LLP (www.pwc.com/ca) and its related entities have more than 5,200 partners and staff in offices across the country.
"PricewaterhouseCoopers" refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership, or, as the context requires, the PricewaterhouseCoopers global network or other member firms of the network, each of which is a separate and independent legal entity.
About Retail Council of Canada
Retail Council of Canada (RCC) has been the Voice of Retail in Canada since 1963. We speak for an industry that touches the daily lives of Canadians in every corner of the country - by providing jobs, career opportunities, and by investing in the communities we serve.
RCC is a not-for-profit, industry-funded association representing more than 40,000 store fronts of all retail formats across Canada, including department, specialty, discount, and independent stores, and online merchants.
RCC is a strong advocate for retailing in Canada and works with all levels of government and other stakeholders to support employment growth and career opportunities in retail, to promote and sustain retail investments in communities from coast-to-coast, and to enhance consumer choice and industry competitiveness. RCC also provides its members with a full range of services and programs including education and training, benchmarking and best practices, networking, advocacy, and industry information.