CHICAGO -- The supermarket industry's precautions against employee theft, bad-check losses and shoplifting in 1996 included widespread use of a variety of technologies, from closed-circuit cameras and cashier monitoring to check authorization systems.
These were among the results from the seventh annual survey of loss prevention and security issues in the supermarket industry, conducted by the Food Marketing Institute, Washington. The study was released earlier this month at the FMI Supermarket Industry Convention and Educational Exposition here. Seventy-four FMI member companies, operating 11,816 stores, participated in the survey.
The survey reported a total of 18,054 detected incidents of employee theft for 1996, breaking down to an average of 262 detected incidents per company, or 2.8 incidents per store. This figure reflects a slight reversal of a two-year trend of increases in the number of detected employee thefts.
The study showed that 85.1% of the respondents used an electronic monitoring device, such as closed-circuit television cameras and monitors and cashier-monitoring systems, to evaluate employee behavior and monitor workplace thefts and shrinkage.
According to the study, 44% of the detected employee incidents occurred at the checkout; a combination of discounting or sweethearting accounted for nearly 24% of all incidents. Sales/service areas were the next most common departments where thefts occurred, at 23%, while thefts discovered in the store back rooms accounted for 10% of the incidents.
The study revealed that the average monetary value of cash and merchandise recovered in each detected instance of employee theft was $175.14.
Bad checks were a major contributor to retailer losses in 1996. Participants reported that bad checks were responsible for a net loss of over $111 million last year. This represents a significant increase over 1995, when bad-check losses totaled $70 million. Results showed that 78.1% of participants used an internal system to authorize checks at the point-of-sale, while 35.4% used a check scan system and 18.8% used another kind of authorization method. Shoplifting remains a leading cause of loss for the supermarket industry; the study showed about 252,000 shoplifter apprehensions were reported across all companies for 1996. There were an average of 41 arrests per store last year.
In order to deter shoplifting, about 18% of stores used electronic article surveillance equipment. Almost 91% of participants using EAS reported that the technology reduced shrinkage by an average of 18.5%. However, only six companies surveyed shared their EAS detection results.
Respondents reported that the average value of merchandise recovered from shoplifting thefts totaled $8.7 million.