Chapter 7

Secure Your Store

Winning Strategies Eaglecrest High School in Centennial,

Colorado, is one of the three original student-based enterprises to secure rights to use the trademarked name “7-Eleven.” Just as in the fast-paced world of a true convenience store, the critical tasks of setting security guidelines, maintaining a safe environment, and eliminating shoplifting are important factors in the success of the school store.

Student managers work diligently by attending yearly training sessions designed to teach merchandising skills, accounting procedures, and basic traffic flow patterns within the store. The training also arms the student managers with a basic understanding of the importance of implementing store security measures while still maintaining strong customer relations.

Customers are asked to leave backpacks, heavy coats, and other traffic flow impediments outside the store in large storage bins. Customers are also polietly asked to leave any previously purchased opened product outside the store before entering. Student managers limit the number of customers allowed in the store to a number that employees can adequately serve at one time. Eaglecrest also uses technology to aid in the survelliance of the store. The store has purchase a state-of-the-art camera security system that records activity in all areas of the store. This in conjunction with a new point-of-sale system gives immediate real-time data on student purchases and activity.

All of these security guidelines, in addition to hourly register counts and proper store merchandising techniques, help provide a safe and orderly shopping environment for the staff and its customers.

1. In addition to the security policies and security cameras already being used at Eaglecrest, what other security measures might be taken?

2. As an employee at the school store, you must learn what signs to look for to help detect shoplifters. What might arouse suspicion of potential shoplifting?

Chapter 7.1

General Security Procedures

Open For Business Assess your store security IQ. See if you can

answer the following questions relating to security policies and your school store: Do you have a policy on employee purchases and

employee discounts? Do you have a limit on the number of customers

allowed in your store at one time? Do you maintain tight controls over access to the

stockroom? Is a safety management program in place?

Make a list of any new security guidelines that you think should be implemented.

Store Security and Policies Store Security

Includes anything that provides protection for an enterprise and its property

Security Policies Standard procedures that help reduce losses in

the store By using general statements of intent about

how to govern security in your store, day-to-day management becomes more simplified.

Employee Purchases and Discounts Policies

The following security guidelines should be considered regarding employee purchases: School store employees should not process

their own sales transactions School store employees should not

purchase merchandise while the store is open for business

The school store advisor should verify all purchases by employees

Inventory and Equipment Policies

Securing the Merchandise A store employee should stand at the door to

ensure customer do not bring bags into the store Securing Equipment

All equipment should be locked up Performing Inventory Checks

Counting can identify shortages and trouble areas Checking In Inventory

If inventory is missing when the shipment arrives the discrepancy needs to be adressed

Store Access Policies Crowd Control

A strategy that limits the number of customers in the school store and allows store employees to adequately observe sales transactions

Housekeeping responsibilities Such as cleaning and trash removal should

also be supervised. These things should be scheduled during store hours.

Cash Shortages/Overages Policies

A policy should be established concerning cash shortages and overages caused by human error or employee theft All shortages over a set amount must be accounted for

and made up Students and parents must sign a form that outlines

employee expectations Records of daily activities are maintained on the POS

terminal or cash register Periodic checks of records are performed to identify

specific trouble areas School administration supports policies relating to

school store operations

Check Point What are security policies?

Safety Precautions Common accidents include slip and

falls, falls while moving merchandise, injuries due to improper lifting techniques, or cuts sustained from broken equipment.

Accident Management Program Outlines safety procedures to be followed

by store employees

Accident Management Program Elements Correcting hazards before accidents occur Completing an accident report form when an

accident occurs Providing employees with protective clothing

and equipment Having a first-aid kit in the store Posting emergency telephone numbers in the

store Offering employees classes in first-aid and

CPR

Conducting periodic safety meetings Creating a written safety plan and

discussing contents with all employees Posting the store layout that shows the

emergency exits to be used in the event of an emergency

Offering incentives to employees who follow safety precautions

Training employees in proper lifting procedures

Demonstrating proper care of equipment such as box cutters, paper cutters, and electrical equipment

Training employees in the proper responses during a robbery or other criminal act

Training employees in procedures to use for reporting suspicious persons or activities

Report Safety Problems You should immediately report safety

problems to the school store advisor If you encounter a safety hazard you

should handle it immediately Alert customers to safety hazards and

assure them that the problem is temporary Keep customer service areas and exits

clear and uncluttered to prevent accidents

Follow Emergency Procedures The store should establish emergency

procedures to be used by employees in emergency situations

You should always request help as needed You should also maintain a calm environment

and be prepared to communicate information as it is made available

Maintain Accurate Records To minimize liability and future

problems, appropriate documentation of safety hazards and accidents should be completed promptly and forwarded to the school administrator

Check Point Why is it important for a business to

maintain accurate records relating to accidents?

Check Out1. Which of the following is not a reason for limiting store access?

a. To meet state fire codesb. To allow employees to observe sales

transactionsc. To control store profitsd. To supervise custodial services

2. An accident management program should consist of a. Having a first-aid kit in the storeb. Correcting hazards before accidents occurc. Training employees on proper lifting proceduresd. All of the above

3. Develop an accident management program for the school store. What kinds of things should be included for our school store?

4. How does the financial impact of workplace accidents affect the school store’s bottom line?

5. In what ways can the school educate students on safe working techniques?

Security Enforcement

Chapter 7.2

Open For Business To increase security, the store manager of a

school-based enterprise developed a policy on shoplifting that required the staff to obtain training in loss prevention. In addition, a security camera was placed at the cash register. The store manager also stationed sales associates at the front entrance of the store to serve as security guards and established an employee incentive program that pays staff members a $20 bonus for spotting a shoplifter who is later convicted and suspended from school.

Although the use of security equipment has helped prevent losses in the store, having students work security has been an effective tool in the apprehension of shoplifters. Unfortunately, one such apprehension almost led to an altercation between store security and the shoplifter. This incident caused the school store advisor to become concerned about current security procedures.

Think Critically Suggest improvements to the current

security procedures in place at this school store. Discuss how employees should handle altercations.

Store Security & Equipment A variety of equipment is available to

help make your store more secure Research shows that most employee

theft occurs at the cash register All employees should know how to use

store security equipment

Cash Registers/POS Terminals POS terminals process transactions

electronically at the point of sale The system selected should be capable

of handling basic tasks such as recording and summarizing sales transactions

The system should have a security system to guard against fraud

Monitoring Equipment Cameras and closed-circuit television

systems used in conjunction with POS terminals are effective tools to minimize losses Closed-circuit systems include cameras

concealed in mannequins, ceilings, or walls. All areas of the store should be covered.

Pricing Equipment Everything in the store should be priced

with tags that cannot easily be removed You should price merchandise as it

arrives in the store

Security Mirrors Can be used when there are blind spots

in the store Inexpensive and are almost as effective

as cameras or closed-circuit security systems in preventing losses

Work as psychological barriers to theft by giving potential thieves the impression that they can be seen

Shelving, Interior and Exterior Displays Racks in the middle of the store should not

create blind spots The arrangement of display cases should

produce an effective traffic flow Lines for food should not block other displays

or eliminate visual access to displays Traffic flow should end near checkout or the

store exit

Check Point List three types of security equipment.

Store Security & Supervision There is also a human factor involved Security can be achieved through

leadership and supervision You should set internal business

standards regarding honesty and integrity and enforcing policies to discipline dishonest employees

Teacher Acting As Supervisor Advantages:

Training is consistent Assessments are easier Communication is consistent

Disadvantages: The teacher must be available at all times As the store grows, it will become more difficult for the

teacher to complete tasks without delegating responsibility

Student Managers Should be selected from advanced

marketing or other business classes Responsible for supervising the

activities of employees and ensuring that they carry out the tasks as identified by the school store advisor

Management Qualities Give Clear Directions Orient New Employees

Training on security equipment, providing information about safety and security, explaining emergency procedures

Be Firm and Consistent Practice What You Preach

Security Checks Operation Profit Homicide:

After the store’s grand re-opening at the beginning of each new school year, the school store advisor may inform employees that “phantom shoppers” will visit the store and steal something

The assigned security manager will prep the phantom shoppers, stressing that they must steal major items from more than one are without being noticed

The security manager will reward those employees who successfully prevent losses

Check Point What are two primary approaches used

to supervise employees?

Check Out1. Which of the following pieces of security equipment is

expensive but will pay for itself over a period of time?a. Safesb. Closed-circuit systemsc. Security mirrorsd. Pricing equipment

2. Identify the advantages of having the school store advisor supervise employees.

a. Training is consistentb. The advisor must be available at all timesc. Assessments are easierd. Both A and C

3. Describe how your store enforces security measures through the use of security equipment.

4. Discuss the advantages and disadvantages of the two primary approaches to supervising employees in the store.

5. Describe the qualities that a student manager should possess in order to maximize a successful store operation.

Loss Prevention

Chapter 7.3

Open For Business Retail theft, including losses from employee theft

and shoplifting, is on the rise again according to a 2002 Retail Security Survey. The survey also showed that one-third of all business failures have been attributed to employee theft. A significant number of losses relate to acts of employee dishonesty and are committed by individuals who have direct access to cash, inventory, and the store’s record-keeping system.

In the school-based enterprise, implementing loss prevention strategies is a total team effort and should be a top priority. Retail theft is a crime of opportunity. It is the responsibility of the team to remove as many of the opportunities as possible.

Think Critically Develop a list of ideas for identifying

loss prevention strategies in the areas of employee theft and shoplifting.

What measures would you recommend to help curb theft in your school store?

Internal Theft Internal theft is a dishonest act committed by

a store employee. Statistically speaking, employee theft is a

greater threat to the store’s potential profit margin than shoplifting or external theft.

Teachers should ask for references from other school personnel before allowing students to work in the store

Reasons for Employee Theft State funding pays for this merchandise, so

the school gets paid back My performance evaluation was low, and my

efforts are unappreciated Everyone else does it The store does not have a written policy, and

the teacher or administration never does anything about it

Inventory Shrinkage Merchandise shortage The difference between the recorded

inventory and the actual physical inventory

Can be the result of internal and external theft, human error, or damaged merchandise

Methods of Employee Theft A trash can could serve as a temporary container

to store stolen goods Employees may lower prices on items for sale to

friends and then over-ring other sales to hide shortages

Employees accept money from the customer and pockets it without ringing the item into the POS terminal

Sweethearting - describes a sales associate giving discounts, uncharged items, or fraudulent returns to friends or relatives

Preventing Employee Theft Software products use artificial

intelligence to analyze POS data The software recognizes patterns of

voids, returns, exchanges, or other fraudulent activities

If employees know that they face stiff penalties if caught stealing, they may think twice before acting

Check Point What ways might a store employee

commit theft?

External Theft A dishonest act committed by people

who are not affiliated with the store

Shoplifting Occurs when a person assuming the

role of a customer steals merchandise from a retail store

Can be any number of different ages, races, economic backgrounds and either gender

Approximately one in every 11 Americans shoplift.

Preventing Shoplifting Serve customers as promptly as possible Acknowledge all customers, even if you are busy Never turn your back on customers Never allow customers to loiter in the store Never leave the store unattended Give each customer a receipt for each purchase Lock registers Keep the store neat and tidy Never allow stocked items to block views Lock expensive merchandise in a showcase

Check Fraud When a check is written perform a

thorough manual and visual inspection of the check

Request, inspect, and compare identification and require that the check be signed in your presence

You should refuse to accept any suspicious checks

Fradulent Checks Insufficient Funds Closed Account Lost or Stolen Altered checks, including checks containing

erasures, overwritten numbers, and tears or bumps in MICR numbers

Counterfeit checks, including computer-generated or computer-scanned checks

Hints to Fraudulent Checks Misspellings Blacked-out information Use of paper identification Excessive writing on the memo line Use of computer-generated check

forms

Counterfeiting High-quality computers, scanners, and

printers are enabling more and better counterfeiters than ever before

Counterfeit detector pens have ink that will change color when used on suspicious currency

Credit Card Fraud People steal credit cards and try to pass

them off as their own Hundreds of millions of dollars are lost

annually in the United States due to credit card fraud

Identifying Credit Card Fraud A card registers a different account

number than the one on the card when swiped through a credit card machine

The signature on the receipt differs from that on the card

The account number is written on a piece of paper or is from an old receipt

Robbery Involves taking merchandise by force or

threat Many robberies involve a weapon If a violent act occurs in the store do not

be confrontational Pay special attention to the robbers’

height, hair color, and any distinguishing features

Detering Robbers Store valuable, such as cash, in a safe

that is locked away in the school store advisor’s office or storage room

Minimize the amount of cash in the register

Lock expensive merchandise or equipment away when not in use

Check Point What should you do during a robbery?

Check Out1. Shoplifting is an example of

a. Internal theftb. External theftc. Loss preventiond. Counterfeiting

2. Identifying and implementing loss prevention strategies in the store is the primary responsibility of

a. Store managementb. Sales associatesc. Security personneld. All of the above

3. How does internal and external theft affect the store’s bottom line?

4. Discuss the following statement: “Employees will steal only to the degree the system allows them.”

5. How do customers benefit when a store has a strong security plan in place?