MAULDIN, S.C. -- Bi-Lo here hopes to jump-start manufacturer source-tagging initiatives through an electronic article surveillance alliance with its partner stores in Ahold USA, Parsippany, N.J.
Bi-Lo and Ahold USA's other retail chains signed a preferred-vendor agreement with Checkpoint Systems, Thorofare, N.J., to use the firm's EAS system in all future store installations. The retailers hope to create a bloc of stores with a common EAS system that will encourage the use of source-tagging.
"The more stores we have, the better opportunity we have to get manufacturers to source-tag for us in the future," said James Wiles, director of loss prevention at Bi-Lo.
Ahold USA's retail divisions include Bi-Lo; Edwards Super Food Stores, Windsor Locks, Conn.; Finast, Maple Heights, Ohio; Giant Food Stores, Carlisle, Pa.; Mayfair Super Markets, Elizabeth, N.J., and Tops Markets, Buffalo, N.Y.
Bi-Lo said an increase in source-tagging could open the door for the retailer to accept new stockkeeping units. "As we move forward with our source-tagging efforts, there will be an increase in attractiveness for merchandising more SKUs," Wiles said.
Being able to offer source-tagged SKUs will increase Bi-Lo's merchandising abilities without requiring additional labor.
"Source-tagging is going to be the key to EAS in the future," Wiles said. "Labor is the single biggest controllable expense that we have today. If we can find a means like source-tagging to reduce it, we're going to be all for it."
Bi-Lo, which began EAS in 1992, now has 95 of its 258 stores equipped with EAS and closed-circuit television cameras.
The retailer completed an intensive year-long analysis this summer of all its loss-prevention technologies and decided it favored scan-deactivated EAS for all future installations.
"We think scan deactivation really helps us from an internal theft standpoint," he said. Pass-around systems, in which items are not deactivated at the store, create an opportunity for employee fraud, he added.
"If the products aren't scanned, the tag, obviously, will not be deactivated," Wiles said. The system "reduces 'sliding' and discounting from cashiers. If you look at shrink in the food industry, the majority occurs at the front end of the store."
Wiles added that scan-deactivated units were more aesthetically pleasing than systems that require having a detector at every register.
He cautioned, however, that no loss-prevention system is fool-proof. "They're always going to find a way to beat the system. All you try to do is put as many controls as you can in place and try to educate the consumer and your associates. Training and awareness about shrink by our associates serves as the best means to control it," Wiles said.