RALEY'S ARRESTING SHRINK WITH EAS SYSTEMS

LINDA PURPURA

WEST SACRAMENTO, Calif. -- Having cut thefts 91% on 14 liquor items after installing electronic article surveillance technology in a test store, Raley's Supermarkets here is moving forward with EAS systems in additional units.

The chain's most recent EAS installation, at a Hayward, Calif., store, went live last month and more installations are planned over the next three years.

Raley's has been able to calculate specific loss reduction figures because it performed meticulous inventory counts before and after an EAS installation. The company plans to do so with future stores as well.

"This is a long-term program and we're going to continue to do this so we have the figures on every store with an EAS system," said Chuck O'Bear, director of loss prevention at Raley's, during a roundtable discussion this month. Several other retailers, many of whom were using EAS systems, also discussed their programs.

O'Bear disclosed highly specific theft reduction figures to illustrate how EAS systems are showing bottom-line results.

For example, six weeks before installing EAS at its Rancho Cordova, Calif., store, Raley's inventoried 22 items in the cologne, after shave and perfume categories. Six weeks after the security system was in place, inventory shrink among those products dropped 73%, he said.

In the natural foods category, 12 items were inventoried before and after EAS and shrink decreased by 56%.

Ten months after the system's installation, Raley's gathered data to determine if customer count or sales volume were affected by the system at the Rancho Cordova store. The retailer found that sales were up 8% from the 10-month period prior to EAS; customer count rose 3% and shoplifting apprehensions declined 34%.

At the same time, Raley's repeated audits of the same items and concluded the overall effectiveness of the system was maintained 10 months after it was installed.

As a result, Raley's equipped additional stores with EAS systems and calculated a shrink reduction rate ranging from 57% to 69% on all items inventoried, O'Bear said.

Raley's has a total of 87 stores in northern California and northern Nevada and began exploring EAS systems in the early 1990s and testing different technologies.

Bill Alford, director of loss prevention at Harris Teeter, Charlotte, N.C., another participant in the roundtable discussion, said he had also tried different EAS technologies but won't pursue it again until the technology gets better.

"We are a very upscale supermarket chain and if you tick off one, two, three customers [with a false alarm] they tell other customers and they tell other customers," he said.

Loss prevention executives from A&P, Montvale, N.J.; Oshawa Foods, Mississauga, Ontario; Bi-Lo, Mauldin, S.C.; H.E. Butt Grocery, San Antonio, and Delchamps, Mobile, Ala., also spoke during the roundtable discussion sponsored by Checkpoint Systems, Thorofare, N.J.