| A Case Study in the Practical Application and | | | | surveillance system, referencing certain times |
| Benefits of Surveillance in Today's Retail | | | | from receipts and cancelled appointments to |
| Environment. | | | | verify whether payment was received and if |
| We hear every day how much employee theft is | | | | customers were in fact walking in the door when |
| costing the small business owner. Last year the | | | | the log books showed cancelled appointments. |
| estimates claim a total loss of SIX HUNDRED | | | | She began looking to see whose hands were in |
| AND SIXTY BILLION DOLLARS according to a | | | | the tip containers at their front counter by |
| recent report from the Association of Certified | | | | watching video from a single camera placed over |
| Fraud Examiners. Not only that, but a full 46% of | | | | the register area. She began implementing even |
| that, almost half, or approximately three hundred | | | | more checks and balances and eventually |
| billion dollars occurs in small businesses with fewer | | | | suffered a severe loss. One of the employees |
| than 100 employees. THAT'S YOUR BUSINESS! | | | | had deleted all the records from the point of sale |
| That's Billion with a B, that's ten zeros. | | | | system. According to the computer, this |
| $660,000,000,000. Stop and think about that for a | | | | employee never worked there! All records of |
| second. Seriously, STOP. Think about how much | | | | sales, taxes collected, appointments cancelled had |
| money that is. How much of that Six Hundred | | | | been lost. There was hope though, due to the |
| and Sixty Billion came out of your pocket as a | | | | data the store owner had been collecting and the |
| small business owner? Likely more than you think. | | | | checks and balances in place physical records of |
| Let's take this massive 12 figure number and | | | | this employee did exist and provided more than |
| break it down into a real case study. I have | | | | enough evidence to confront the employee and |
| worked recently with one customer who | | | | terminate them with police assistance. The key |
| operates on razor thin margins. Because of these | | | | here is that video and physical data provided |
| razor thin margins this customer was originally | | | | enough evidence to accurately rid the store of |
| hesitant to make an investment of approximately | | | | the problem and stop the losses which were |
| $3,000 for a small professional digital surveillance | | | | conservatively estimated at $150 PER DAY from |
| system. It is understandable; $3000 can be a lot | | | | this single employee! This employee was |
| of money for a small business. Fortunately this | | | | responsible for losses which would have added up |
| customer had an inkling of the truly massive | | | | to $45,000 in a single year. Can you imagine |
| amounts the business she was losing due to | | | | paying someone a $45,000 annual bonus for the |
| employee collusion. I say inkling because this | | | | privilege of stealing from you, putting your |
| customer made the decision to protect the store | | | | business at risk of severe financial damage, risking |
| based on the rising difficulties of running multiple | | | | the jobs of all your employees and defrauding |
| locations, and was not really, truly convinced of | | | | your customers? This happens every day in |
| the losses the stores were realizing every day. | | | | every retail establishment in America. |
| The truth of the matter is that the video | | | | In today's world it is not enough to rid ones |
| surveillance system helped to identify some very | | | | business of the drain, the thieves, the losses and |
| substantial losses. These losses were occurring in | | | | the deceitful employees. Business owners must |
| small amounts on a daily basis so that the day to | | | | reward those that have proven to be |
| day cash and financials were not severely | | | | trustworthy and a true asset to their company. |
| impacted. Think about it, if you're missing $150 a | | | | This business owner did just that. After this was |
| day from missing product, "cancelled" | | | | all over, she rewarded the individual store |
| appointments, credit cards converted to cash in | | | | managers with a sizable annual increase in pay as |
| pocket, and various other mischievous employee | | | | a sincere thank you for following the procedures |
| actions it may be difficult to spot. As a matter of | | | | and checks and balances that have allowed for |
| fact, $150 a day in losses in a retail environment | | | | increased prosperity of the business. There is an |
| is usually the tip of the iceberg. At the end of the | | | | old adage, "when the cats away, the mice will |
| year however, when that $150 adds up to | | | | play." By doing this the business owner has |
| approximately $45,000 it becomes a little easier | | | | created more cats. Not only this, but she has |
| to see that something is horribly wrong. This is a | | | | removed temptation by ensuring that the video |
| casebook example of the truly disastrous effects | | | | surveillance systems can be viewed remotely at |
| of employee theft. | | | | any given point in time. The first challenge is |
| Let's begin with identifying what was actually | | | | keeping the honest people; the second challenge is |
| happening in the store. The business we are | | | | keeping the honest people honest. |
| looking at is a service based retail establishment | | | | When looking at cases like this in hindsight, the |
| focusing on families and retaining existing | | | | $3000 initial investment becomes a no-brainer. |
| customers for recurring business as often as | | | | After all, who wouldn't spend $3000 if they knew |
| possible. What it is that they do is unimportant, | | | | they would stop $45,000 in losses? The problem |
| and I will not divulge due to their competition being | | | | lies in that there are not many small business |
| well aware of how much quicker this company is | | | | owners out there who believe they are losing |
| growing. The positive impact on losses that their | | | | upwards of $45,000 a year per store. Well, that |
| surveillance system provides is partially responsible | | | | $660,000,000,000 has got to come from |
| for allowing this success. The store employs | | | | somewhere, and I will tell you that the horrible |
| several employees and accepts cash, credit cards | | | | truth is that it is likely coming out of your pocket |
| and checks. The losses were becoming more and | | | | in larger amounts than you can imagine. The |
| more visible as the store owner began | | | | fact remains that this customer has not stopped |
| implementing simple checks and balances for each | | | | all of the losses in their business. The system has |
| day's numbers. As these policies were | | | | been paid for in full and a return on investment |
| implemented various inconsistencies became | | | | has been realized in spades, yet the surveillance |
| apparent. Credit card receipts that did not match | | | | system, due to its practical application into the |
| the appointments in the system, certain | | | | day to day business activities of this customer |
| employees had much higher percentages of | | | | keeps providing measurable results that result in |
| "cancelled" appointments, and correlations | | | | improved business practices that ultimately mean |
| between profitability and certain employees | | | | more money in my customers pocket. Imagine |
| scheduled work dates led my customer to | | | | that the surveillance system were an employee. |
| become suspicious of the daily goings on. | | | | Would it not be an amazing investment to hire a |
| The next step the owner took was vital to the | | | | manager who would work a lifetime for the paltry |
| success of stopping the losses. She began to | | | | sum of about 6 weeks worth of wages, never |
| think like a thief. Separating herself from the | | | | take a vacation, never require benefits, and never |
| situation allowed my customer to see | | | | ask for a raise? Now add to this the fact that this |
| opportunities for losses that she had not | | | | employee will never lie to you and happens to |
| previously spotted. Concerns began arising due to | | | | have photographic memory (literally), and the |
| discrepancies of tip amounts on credit cards and | | | | decision to buy a properly designed digital video |
| those entered into the point of sale system. At | | | | surveillance system becomes a need and not a |
| this point the store owner began keeping a closer | | | | luxury. How much is your business losing every |
| eye on numbers and consulting with the video | | | | year? |