Can Loss Prevention Be Free?
How much does it cost? How about free? Can loss prevention be free? Actually it can be. Like everything else you do in a business, loss prevention should make or save you money. Yes, there are expenses. If you are a grocer you purchase shelving and coolers. A clothing retailer purchases racks for clothing to hang on. Every retailer has some form of cash/wrap counters and Point of Sale (POS) to sell the goods the customer has selected. None of these things “make” any money themselves. However, they are necessary to display merchandise, attract and complete the transaction with a customer.
The same goes for loss prevention devices. Can loss prevention be free? Yes, actually it will make you money! This is how. In this example let’s assume your profit margin is 2% after all expenses. So after you pay the bills, utilities, rent, cost of goods and payroll, you are left with 2%. Figuring that 2% into a loss will tell you what it actually costs you.
Take the loss for a shoplifter or any other loss, let’s say $500 and divide it by your 2% margin, $500/.02=$25,000. What this tells you is that to BREAK EVEN, not make money, you will have to sell an additional $25,000 on top of your normal sales to make up for the loss of that $500.
The fact is that you cannot do it, at least for very long. So our goal must be to keep it from happening in the first place, hence, loss PREVENTION.
Now let’s consider the cost of a Sensormatic security system. To cover a standard double doorway we will use the example of $4000. Yours could be more/less.
Now we take for this example annual sales of 1,000,000.00 with a conservative estimated shrink of 1.2% and a conservative shrink reduction rate of 0.65% on the cost of a Sensormatic security system of $4000 and plug it into our Loss Prevention ROI Calculator and find that your investment will break even in 6.15 months. So in a little over six months your Sensormatic security system will be making you money. Can loss prevention be free, YES it can.
The cost of the Sensormatic security system is a heck of a lot cheaper than the cost of that $500 loss.
We have a loss prevention ROI calculator on our web site. Follow the link and put in your own numbers. Play with it by trying different rates and dollar amounts that work for your business. The loss prevention ROI calculator is confidential. And even better it is also a free loss prevention calculator. You can even save and print out your examples.
However, the thought process does not end there. If you are considering a Sensormatic system or another brand you need to ask the Dealer you are talking to several questions that play directly into the cost of the system you are thinking of purchasing:
1- Is installation included?
2- Are the Installers Factory trained?
3- How do you obtain service?
4- What is the turnaround time for a service call?
5- Who will come out to do service on your system?
6- What is the warranty on the equipment?
7- What U.S. retailers use the equipment they sell?
8- Are they just in sales or do they have actual loss prevention experience?
9- Will that Dealer conduct free live training on how to use the system?
10- Will they conduct free live anti-shoplifting training that covers how to understand and attack YOUR individual shoplifting problems?
11- Will they conduct that free live anti-shoplifting training anytime you reasonably need it for new associates?
12- Do they provide you materials to conduct your own anti-shoplifting training if you so desire?
Please be sure to ask us every one of these questions and any others you have. You will like our answers.
Try the free loss prevention calculator and contact us if you have any questions about Sensormatic security systems, anti-shoplifting, loss prevention calculator or any other loss prevention issues.
Can loss prevention be free? YES it can with Loss Prevention Systems, Inc. Contact us today at 1-770-426-0547.