Eight Steps to Secure Retailing - Advanced Security Technologies Take Loss Prevention to Lucrative New Levels By Robert Siegel There are three specific challenges to retail security that make it unique versus other settings. First, there is a greater breadth of locations and size than found in many other industries. Not all outlets are capable of getting the same amount of service. Second, there is a great challenge with POS integration. Every POS software package, as well as each and every terminal, is different, even within the same retail organization. There are multiple vendors, different connections and different series of the same brand products. That makes each retail implementation a custom job. Third, the speed of technology is happening so quickly that once a retailer has installed a solution, the system often times needs enhancement. Yet, with all this disparity, loss prevention has become as important to retail profits as products, pricing and promotion. Retailers can preserve — and often increase — profits simply by investing in systems that reduce shoplifting and internal theft. U.S. retailers lost $38.1 billion to shrinkage in 2004 – 1.7% of total sales. The two major trends that shape retail security are the continued need to watch employees and instituting passive shrink control. Many retailers are surprised to learn that nearly half of shrinkage is due to employee theft and that the average recovery from an apprehended employee-thief is seven times the average recovery from an apprehended shoplifter. On top of that, half of employee theft takes place at the POS terminal; that’s $8.9 billion dollars per year (2004) lost right at the POS terminal. Simply interfacing video surveillance with POS is one of the most effective loss prevention strategies, yet only 13% of retailers employ it. While public view monitors are being used more and more to deter shoppers and employees from committing crimes, these tools are but one step to help prevent loss. If approximately 23% of loss is enacted by employees at the POS terminal, there is still another 77% to account for, including – Robberies and shoplifting Price tag switching Credit card fraud Counterfeiting Customer return fraud Other employee and vendor theft Assaults or attacks, and Burglary and vandalism. So what's a store to do? Take advantage of technology that is already out there, and stop the losses right now. However, retailers are not taking advantage of what “security systems” can actually do for them. What one camera watches can provide differing information for various departments. By not bringing departments together to maximize the productivity of their systems, retailers are limiting the ROI of their installations. In other words, retailers need to move from security-centric product solutions to retail business solutions that happen to use security products. For instance, retailers should consider using video data to describe activities and create analytical reports. Instead of just watching what is happening within the cameras’ fields of views, video becomes associated with other data forms. Per example, marketing can test product appeal via shelf location while security focuses on shoplifters and employee theft. Advanced camera techniques now capture clear, detailed images. Digital recorders retrieve footage instantly. Networked systems let people watch video over the Internet. And, because loss prevention goes beyond surveillance, one can also take advantage of integrated access control and intrusion alarms, GPS tracking, and electronic keys. For instance, in addition to being integrated with the data network, the surveillance system can also interface with the alarm system, alarm sensors and/or access control system. If the access system or alarm sensor detects unwanted activity, the digital video recorder (DVR) or combination digital video multiplexer/recorder (DVMR) can be programmed to capture more images of the incident. In addition, security guards, managers, administrators, business owners and even law enforcement can be notified upon an alarm. They immediately know the location and nature of the alarm so they can remedy the problem immediately. They don’t need to waste time by first checking the surveillance system for such details. Without having to physically verify what is happening on their surveillance system, key personnel can immediately respond to the alarm and take immediate action. No matter where those needing to be alerted might be, a DVR can send them a message via their PC, laptop, PDA, cellphone or pager, notifying them of the type of alarm and where it is located. Alarms can be emailed in response to alarm situations or external alarms. For instance, during set-up, a user can program a DVR with conditions that count as alarms, based on object size and object location within a scene. The surveillance system can then employ video motion detection to look through the camera, detect any changes within the scene and recognize an alarm condition. Users can additionally set detection sensitivity and false-alarm-rejection levels. Once an alarm is triggered, the DVR can display images from up to four cameras associated with the alarm area and sends a message to pre-selected email addresses. Hardwired alarms such as door open or window open can also activate such email messages. Eight Simple Steps to Take Retailers are advised to take eight steps to create a solid loss prevention program: 1. Deploy a high-tech front line of defense. Surveillance cameras are available in all shapes and sizes, including traditional, discreet, covert and dome cameras. New innovations overcome glare, shadows and backlighting. New direct-drive motors provide pans/tilts/zooms of exceptional smoothness and precision. You can capture identifying details even as the camera follows prospective shoplifters moving through the store. 2. Share evidence quickly and easily. Whether the business has one store, a small chain, or hundreds of stores, there is a digital recorder right for the application. For smaller retailers, they should make sure that their DVR has a built-in CD-R to make it easy to share evidence with law enforcement. So people won't miss crucial details from any of their many cameras, larger retailers can select units that capture 120 pictures per second.. 3. Take exception-based reporting to the next level. With a POS interface, retailers can associate receipt text with video from their digital recorders. This technology also works with exception-based reporting software. Loss prevention professionals can match video with receipt text like "No Sale," "Void," or "Refund" to help confirm suspicions that a cashier is stealing money or merchandise using phony transactions. 4. Subtly announce loss prevention measures. Many retailers display live video on a large screen, such as a 20-inch LCD, to announce they are using surveillance cameras. People literally see themselves on the monitor. When it's not showing surveillance video, these monitors can additionally display a variety of advertising and multimedia messages. 5. Mind the store remotely. Video surveillance systems will let loss prevention personnel view live or recorded video from any camera on the store’s network from anywhere they have Internet access. Even if the operation’s cameras are older analog models, new systems allow retailers to use them in a digital system. 6. Control access without keys. Smaller retailers can take advantage of new systems providing a single platform for intrusion alarms and access control. One card unlocks doors, disarms alarms—even turns on the lights—automatically. At closing time, the store manager or owner simply locks up and the central station provider takes over automatically. 7. Deploy deliveries efficiently. Business service mapping uses GPS to track and deploy delivery crews. Using an intuitive, map-based interface, dispatchers can schedule projects and assign employees and vehicles to create customer satisfaction with on-time deliveries. Such systems can even determine the best driving routes and generate driving instructions. The increase in driving efficiency will save your organization both time and money. 8. Manage access to delivery vans. Retailers can also equip delivery trucks with locking systems that audit every time a lock is opened and by whom. These intelligent electronic key systems also let retailers manage key holders, access codes, expirations and renewals to prevent unauthorized use. Intelligent Video – Coming Soon to a Store Near You By now, almost everyone understands that digital video systems have a great advantage over analog systems. But, they are also in their infancy with new applications, such as video content analysis, powered by intelligent video systems that will be introduced over the coming months. Intelligent video will be the most discussed security technology over the next couple years. Intelligent video solutions will impact the retailer more than users in most other industries. The opportunities it will provide security directors, as well as managers in loss prevention and marketing, are enormous. Imagine having the system be able to alert you to what is going on as it is happening. For instance, intelligent video systems already eliminate false alarm reporting by determining whether or not humans, versus wind, animals or other elements, set off the motion detector. With such systems, retailers have verification to call in an alarm to the police. Such intelligent video security solutions, combining immediate access to video surveillance images, access control audio, data streams and public address functions, and leveraging management application software packages designed for specific markets and concerns, are becoming the hearts and souls of new advanced security and safety programs. With intelligent systems, it will soon be possible to detect incidents in real time and, oftentimes, before the event becomes serious. Imagine detecting smoke before there’s a fire or catching an employee committing a crime as it happens, not finding out days later. Start Improving the Bottom Line Today The most important thing retailers must do is to create dialog among their various departments to more efficiently and productively use their systems. They must bring together managers from Loss Prevention, Security and Marketing, among others, to create a total retail business solution. About the Author: Robert Siegel is General Manager for Video and Software Solutions for GE Security