2017Issue4_Alabama_v3_COVER_Proof

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BIG 4 Best Practice Areas

2.“GetYour BIG” Every day! Seventy-five percent of all companies we work with have a Known Loss program. Thirty percent of these companies have a good, efficient and effective Known Loss program. Properly implemented, Known Loss can be your portal into Profit Loss. We calculate that Known Loss Control is the No. 1 most failed shrink prevention program. The source of Known Loss can most often be tracked back to breakdowns in the efficiency of ordering, handling, storage, production, display and sales. Hence, training operators in the very best and proven practices for seeing and proactively managing known loss and implementing smart Known Loss control technologies must be a top operational imperative. Implementing an effective Known Loss program is the first step on the yellow brick road to 18 percent lower shrink loss, leading to sales and profit improvement. What is meant by our “Get Your BIG” strategy? It means recording 100 percent of known loss caused by damaged and/or distressed products and 100 percent of any programmed gross margin erosion. When we see our BIG every day and understand the mandate to be sales driven, we can help to change the operational thinking and behaviors associated with profit optimization. The difference between a weak Known Loss program and a best practice guided Known Loss program is 17 percent less shrink with every dollar saved going straight to your bottom line. 3. Smarter Ordering your BIG, operators and loss prevention professionals must think about turns, turns, turns. Smart ordering is all about being 100 percent in-stock with full variety while turning your inventory with minimal associated Known Loss. Building on the concepts of the vital role of inventory control and getting

1. Sales We always want to optimize sales. This demand’s focus on variety, optimal on-shelf availability, and an intense focus on fresh item quality. Customers come to shop, and our #1 job is to ensure they get what they came for. The three consequences of being out-of- stock or selling poor quality perishables include: a lost sale, customer having to trade off to a similar (but not desired) item, or worst of all, sending the shopper to a competing store. In summary, the tracking and managing of variety, freshness and your optimal in-stock condition are vital to profitable selling best practices. Tracking and managing daily sales at the lowest department or sub-department level allows managers to disrupt negative or sub-par sales trends (mid-week or mid- period) to promote for added profitable sales. managers to promote one or two in-store (non-advertised) weekly featured items using promotional signage, displays and CSE best practices to grow sales $1,000 per week ($52,000 annually). Depending upon your situation, sales may or may not be a significant remedy to your shrink rate, but two things always remain true: (1) sales are every company’s life-blood and should be the everyday focus of operators and merchandisers and (2) profitable sales are every CEO’s No. 1 priority. What does this have to do with loss prevention? Traditionally not much, but with 64 percent of store shrink caused by a breakdown in store operations best practices, if loss prevention is to grow its value proposition as a profit realization partner then we must align with and contribute sales profitability and help operations sell its way to lower shrink loss. Next, shifting into high gear. Then, every store manager should collaborate with their department

Here’sWhatWe Know:

64% Operations

36% Theft

Average Shrink: 2.70%

Shrink Caused by Operations

17% Production Planning & Specs Allocations

6% Receiving

14% Store & Handling

22% Ordering

13% Rotation

14% Cashier Errors

6% Damage

3% Accounting

5% Scan File

57% Preventable

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