When it comes to food and inventory shortage there are two factors to take into consideration, how to prevent out of date merchandise and how to stop shoplifting. I have seen merchandise that has had to be marked out of stock because the food has expired. One of the reasons for many of the unnecessary mark-outs is a failure of the store to have a good product rotation program in place. As a freight manager I always stressed to my team the importance of using FIFO (First In First Out) when putting out merchandise. This could be difficult for the team when they were being pushed for time (which was always). I would audit behind them and sometimes find shortcuts had been taken. Occasionally a worker pulled the first item on the shelf and then put out the new merchandise and then put the first item back. This gave the impression that FIFO was followed when it really was not. Those items that were not rotated would go out of date and then we had to process them and mark them out of stock. What a waste! There were also the products we stocked that just did not sell. They may not have been the right item for our store or customers just didn’t like them. Any way you cut it the product sat there until the company issued markdowns and sold it on clearance or they went out of date. The other issue we often found with out of date product was when the merchandise was vendor supplied and stocked and the vendor failed to give timely vendor credits on goods that were not selling.
The other major cause for shortage in grocery stores is due to theft. The first issue involves operational matters and can be resolved by putting good practices in place. Theft on the other hand requires another solution and that should be the use of Sensormatic labels. Labels can be used on almost anything a store carries. From canned foods to steaks, there is a remedy available from Sensormatic security systems for nearly everything a grocer carries. Now you may not need to put a label on a can of corn but you can put a Sensormatic APX Microwavable Roll Label in meat soaker pads or under the meat trays for those expensive cuts of beef and pork. Perhaps your store carries some health and beauty items as well as foods you can protect these with the HBC labels. There are also hard tags available that can protect higher end merchandise such as infant formula. All of the Sensormatic labels and tags carried by Loss Prevention Systems, Inc. (LPSI) are proven to stop shoplifting and that is the reason they are recommended by LPSI for their clients.
Why the fuss about grocery store shrink? It is a concern because “Shrinkage as a % of revenue 2017-2018” came in at a whopping 1.90% according to the Sensormatic Global Shrink Index (pg. 43). As I was looking for some specific grocery store theft statistics I found something I wasn’t quite expecting. According to one website I browse, they pulled some statistics from businessinsurance.org listing 9 of the top items stolen from stores. Topping that list was meat and coming in at number three on the list was baby formula! Operations may be causing some of your shortage but you cannot discount the impact theft is having on your store as well. You have to stop shoplifting if you are going to make a difference in your shortage results.
Equipping your store with an electronic article surveillance system from Sensormatic and protecting your merchandise with Sensormatic labels you can be certain you will reduce theft. Purchase that system from LPSI and you not only enjoy the benefits of owning a Sensormatic security system you receive free Loss Prevention training from LPSI. You won’t find an equivalent offer from any other company. If you are concerned about the cost of a system LPSI also has financing available for qualifying businesses. Don’t waste any more time find out more about how LPSI can help you make your business grow as you reduce shortage.
Get more information on Sensormatic labels, contact us or call 1.770.426.0547 today.