4 Tips to Reduce Theft At The Front End

The average shrink rate in retail has increased in past years, up 0.2% between 2021 and 2022, representing $112.1 billion in losses. With such small margins in the grocery industry (between 2-3% in a top-performing store), independents must do all they can to prevent shrink — especially theft — at the front end. 

While there is no one-size-fits-all security solution for independent grocers of varying sizes, IGA Coca-Cola Institute President and CEO Paulo Goelzer said with some planning, grocers can make great progress in reducing theft at the front end.

"It's possible to balance implementing robust measures against theft and ensuring shoppers enjoy a safe and welcoming environment," Goelzer said. "Investing in training and technology, and taking advantage of store layouts, can minimize shrink losses."

During a session at The NGA Show in March 2024, Goelzer hosted a panel on how grocers can reduce theft at the front end. Keep reading to learn what tips Goelzer and the panelists recommend independents implement.

1. Employee Training

"The first line of defense for a store is an alert staff," IGA CEO John Ross said. "Theft grows when bad-actors think no one is looking or worse, that store staff doesn’t care."

Stepherson's SuperLo Foods VP of Finance Ashley Harris prioritizes staff alertness. At the nine-store group in Memphis, Tennessee and Southaven, Mississippi, direct managers teach new employees firsthand how to inspect torn or switched product labels. They also encourage trainees to take a quick look around to observe shoppers.

"If shoppers are aware of alert staff, we can better prevent theft," Harris said.

Online courses are an effective tool and good return on investment for employees, Goelzer said. Training helps employees recognize different sources of shrink, including: payment methods, documentation, inventory, and other internal and external errors, like bottom of basket errors. 

Dave Cleckner, director of operations at Buehler Fresh Foods, agreed, saying that training boosts employee engagement and provides good customer service.

“Our onboarding process touches on topics like theft and shrink and how it affects them and their pack,” Cleckner said.

He emphasized continuous employee education by including a learning center in the payroll time attendance system and making it a monthly or yearly employee requirement.

The IGA Coca-Cola Institute offers several courses on loss prevention and shrink, including: Loss Prevention–Basics, Loss Prevention–Forms of Loss, and Finance–Shrink.

Finally, store teams must also help shoppers effectively learn self-checkout technology, said Tony Latona, executive director of professional services at NCR Voyix Corporation. He noted that store teams can prevent inaccuracy in store inventory by teaching their shoppers to use it properly.

2. Leverage Technology

Technology is a key ally in reducing theft and shrink in grocery.

Latona noted an especially effective option is integrating overhead cameras and fresh produce recognition software in the sales system to monitor what happens during checkout, not only with the goods but also within the surrounding areas.

These cameras are positioned in the scanners to recognize items being placed on the scale and determine if the same item is moved into the basket or bag. The system uses AI and computer vision to automate the manual encoding of price look-up (PLU) numbers and give shoppers hassle-free self-checkouts.

“The smoother you make the transaction, the less shrink [losses] you experience,” Latona said.

And of course, we can't talk about technology without bringing up AI. Analyzing surveillance footage makes it easier for stores to observe inventory changes in almost real-time. When retailers take the data from transaction time, volume, and sequencing and feed it into artificial intelligence (AI), stores can recognize and keep an eye on inconsistencies in store activities.

“Analytics and surveillance leverage plays an important role in getting insights and understanding what is happening in the store,” Goelzer said.

3. Store Design & Preventative Measures

Design and layout choices go far at Stepherson's SuperLo Foods, as they act as preventative measures for theft. Harris noted their store layout only allows single entry and exit points to make it easier to see (and catch) potential shoplifters. They also have security checks and coordinate with the fire department for delayed responses on exit doors to prevent unauthorized and non-emergency uses.

Their checkouts are located near exits so attendants can easily see the patterns of people passing through in one direction and prevent bottlenecks at the register.

Similarly, Latona recommends applying a "wall of defense" store layout, with the goods arranged so that cameras and employees have a clear view of the front-end sections of the store. If you are not planning a full-store remodel in the near future, repositioning goods and check-out stations to mimic this wall of defense is a good solution to prevent theft.

4. Collaborate with Law Enforcement

Partnering with law enforcement, local state government, and community organizations helps enhance the path to prevent theft in grocery stores. Harris emphasized that establishing awareness through database building will minimize organized crimes and encourage participation from security enforcers and other store owners. Notably, it also provides proof of the theft, which may be needed to educate legislators as they try to push through laws preventing retailers from reducing theft.

To aid your staff in conflict resolution, register for the upcoming FMI-TPOP webinar, How De-escalation Techniques Can Reduce Violence in Your Food Retail Organization, scheduled for June 27, 2024.

Each of these tips can help an independent grocer prevent theft at the front end, but each store will have different needs.

“The balance between providing customer service and reducing theft or shrinkage is very bespoke. It depends on the personality of the people in the store and can vary across different states, so there is no one solution,” Latona said.