With shoplifting and organized crime on the rise, store losses are mounting across the U.S. According to a report by the National Retail Federation, in 2021 retailers faced $94.5 billion in losses due to theft, up from $90.8 billion in 2020. Sergey Kharkovchenko, who created the largest network of anti-theft specialists across Western Europe and the Middle East, shares his tips on loss prevention.
What are the biggest challenges for anti-theft systems in retail?
Apart from shoplifters and criminals, the biggest challenge is gradual deterioration of anti-theft equipment. Other factors that have an impact include foot traffic, which is the number of customers who enter your store, as well as the quality of the equipment, and even electromagnetic interference (EMI).
The quality and speed of repairs is especially important for international retailers, because they have to provide customers with a seamless experience. Stores prefer not to lock up high-end gadgets: there is a correlation between sales volume and personalized interactions with phones or tablets.
I’ve developed a proprietary maintenance method to improve the speed of repairs through a network of tech professionals spread across different regions. To support our clients, such as Apple, we educated and trained anti-theft technicians in Eastern and Western Europe, Scandinavia, Israel, and other countries.
What parts of the world were the most difficult to work in?
U.S. retailers have been reporting significant losses this year, but every region in the world presents unique challenges. As a part of maintenance work for Apple, our technicians had to fix equipment in some remote areas as fast as possible.
For example, we had to provide service on Israel’s border with Palestine. In Norway, we worked in places like Trondheim, the country’s technology capital, as well as small towns in the Arctic Circle.
We were responsible for hundreds of brand-zones in Apple partner stores. Various noises from broken anti-theft equipment can be very annoying, both for consumers and employees. We had to make sure everything runs smoothly and doesn’t affect our client’s relationships with its partners.
Normally, organized crime accounts for only 20% of all equipment malfunctions globally. Oddly enough, France accounts for the most retail theft we have had to deal with. Almost every incident was connected to organized crime, when thieves break into a store at night and completely destroy the protection equipment.
How significantly can anti-theft equipment reduce losses?
According to Checkpoint, the multinational provider of solutions that combats shoplifting, theft losses equal 2% of retail business turnover.
As a Checkpoint representative in Eastern Europe, I’ve been sharing the details of their benchmark report, the Global Retail Theft Barometer, with the retail industry. Based on their data, I created my own algorithms and developed a mathematical model showing clients how they could reduce these losses up to 1%.
Anti-theft equipment, however, does not eliminate crime completely. Most retailers are using other strategies to deter thieves and compensate for losses.
What is the future of anti-theft equipment?
Radio frequency identification, or RFID, is a new technology that’s gaining popularity. It allows retailers to keep track of their inventory and shipments, as well as detect shoplifters. An estimated 15% of businesses have already integrated RFID, but the technology also has privacy implications because it can allow retailers to provide targeted ads based on a shopper’s movement patterns.
