Christmas Time, Mistletoe & Crime
The retail sector has been under serious pressure over the last few months, from panic buying of toilet rolls, to maintaining social distancing to experiencing a drop in footfall in stores (an 80% drop in April). Now, when the dust is slowly beginning to settle, retailers will need to be gearing up for their biggest season of the year, Q4, which includes Halloween, Black Friday and Christmas.
Christmas is Coming
In 2018, offline sales figures for the Christmas period reached a staggering £54 billion, with UK shoppers spending £1 billion more on groceries during this season. To prepare for the spike in sales, retailers need to prepare their supply chain months in advance to ensure sufficient inventory levels are available.
However, even with the vast preparation in stock, numerous products may fall short due to shrinkage. On average food retailers experience a 2% shrinkage rate and at Christmas this figure increases due to the rise in theft. Winter seasons make it easier to steal goods due to reduced daylight hours, the possibility to concealing goods under larger items of clothing and increased visitor density.
During this period, a huge proportion of seasonal items are stolen alongside the top 4 most stolen goods, which include; meat, cheese, confectionery and alcohol. Many of these are easy targets for thieves, as during this period they are heavily promoted meaning they are placed right at the front of the store or at the end of isles surrounding by signage including the latest offers.
A Loss Prevention Armour
Instances of shoplifting nearly doubled to 950,000 cases last year, 200 every hour, according to the ACS. To counteract this spike in shrinkage, retailers need to be considering new loss prevention tactics and soon! Although it may seem like Christmas is a while away, implementing an effective loss prevention solution is a lengthy process and must be refined over time to be as effective as possible. Retailers want to be sure they have a stringent solution in place ahead of the season in order to protect against loss.
A major problem that retailers currently face is that they don’t always possess accurate data surrounding shrinkage levels within their stores. Without this insight, retailers are unable to make effective data-driven decisions that will lower shrinkage levels. The implementation of the latest technology can enable object identification and in turn accurately identify which products are subject to the highest rate of loss. These AI-driven solutions use barcode recognition to identify items that have not been paid for, giving shrinkage rates in real-time.
These solutions can be implemented into self-checkouts, where retailers experience nearly double the rate of theft compared to traditional checkouts. The technology works with IP cameras to capture customer interactions and processes images on edge computing devices, giving real-time insight on loss. These solutions also offer immediate alerts to managers, so theft can be prevented completely.
The use of this technology enables retailers to have data both on an individual store level and estate-wide, which can be analysed to determine if there may be correlations. For example, the analysis may show that there is a correlation between certain products theft rates, or the type of store. It may also indicate that there are improvements to be made in the store layout, as there may be blind spots that they were previously unaware of or areas that may be making products too accessible.
Christmas is usually a great time for sales, but these additional sales will only be beneficial if they are not counteracted by theft. Retailers need to be sure they are prepared for the upcoming season with procedures and technologies in place to minimise shrinkage. Gain visibility first, then take action.
To find out how Hark can help your retail operation, click here.
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