Download - Building Your LP Program
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Loss Prevention, Auditing & Safety Conference 2009 Title Sponsor:
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Building Your LP Program
Stephen ScottDirector, Loss PreventionTractor Supply Company
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Tractor Supply Company
Specialty niche retailer catering to hobby farmers, ranchers, land and pet owners and anyone who lives the rural lifestyle
885 stores in 44 states 5 distribution centers $3B in sales 18-20K sqft. selling space Brentwood, TN (Nashville)
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State of Business in 2003
Day one on the job 400 stores in 30 states 1.2B in sales revenue No loss prevention department No proactive thoughts or actions No budget for security resources Shrink levels unacceptable A preconception about a “security” department
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Your Role and Your Culture
How will the department be defined? Security department Bad guy for Ops and HR A necessary evil
or A strategic business partner A professional resource
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Partnerships
Identify the people or groups critical to success and build relationships Human Resources
Educate them on LP and how you can affect them Store Operations
Make them see you as a resource and not an oversight department
Finance (Budgeting) Effectively communicate objectives and ROI information
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Assess Your Current Situation
What can be fixed with little or no money? Policies (benchmark from peers or mentor)
Cash handling procedures Key control program Open and close procedures Trash removal, package checks, etc.
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Low Hanging Fruit / Early Wins
Contracts Evaluate all LP related contracts
Alarms, employment screening, security hardware
Vendor line reviews/bids Savings with or without changing vendors
Major internal cases No one has been looking
Communicate success stories!
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Get to the Data
Use existing software to get simple reports Get data on negative POS transactions 3rd party exception reporting
Wait until you can support it
Financial Data What merchandise categories are causing the shrink
Attack accordingly Where else can you make the biggest splash
Cash, checks, credit
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Investigations
Do the proper diligence on each case, but don’t spend all your time on investigations Use telephone interviews Don’t handle every discount and soda case
Use the early low hanging fruit and large cases to your advantage Shows ROI for resources and the department
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Prioritize your Budget
Limited funds…spend effectively Field loss prevention CCTV EAS Benefit denial products Corporate LP support Logistics loss prevention Case/Incident management 3rd party exception reporting Awareness program
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Vendor Partnerships
CCTV and EAS Test products at no cost Choose your test stores carefully
These resources will not fix operational weakness Effectively communicate the ROI Emphasize crossover benefit with CCTV (Risk/HR)
Don’t advocate a huge spend without a certain timely ROI
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Field Resources
Regional LP Managers Sold the first RLPM position as a test* Huge success – took work away from operators and HR Hired hard – Find people that fit your culture
The Key Operators saw success and wanted more LP LP was not forcing the issue
*I forgot to mention this was a test to the first RLPM we hired
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RLPM Focus – High Impact
Target Stores Focus on the worst first (10-15 stores each)
High Shrink Reviews Analyze PI data, general shortage interviews, audits, physical
security assessments
Training and Awareness Store, district and regional meetings Store audits New stores
Investigations
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Current Staffing
8 Regional LP Managers 100+ stores each / $400M sales volume
LP Operations Manager Alarms, CCTV, EAS, key control, POS
Logistics LP Manager National Investigator POS Exception Team (3)
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Summary (Do’s and Don’ts)
Do…
build key relationships Find the people important to your success
win early without spending money Contracts, policies, low hanging cases
prioritize and test Hardware, software, people
communicate your success and sell it for the future Learn how to effectively present your ROI
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Summary (Do’s and Don’ts)
Don’t… put all of your brilliant ideas on the table at one time
Prioritize and chip away at the critical few
be concerned with internal case stats Be seen as a business unit not a security team
compromise when hiring Hire hard and surround yourself with talent
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Building Your LP Program
Q & A