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P19 nrss final presentation with audience results_6.26.19

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National Retail Security Survey Interactive Discussion

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P19 nrss final presentation with audience results_6.26.19

  1. 1. Robert Hanson, Professor Northern Michigan University Dan Faketty, VP Asset Protection & Safety Southeastern Grocers Thank you to our session sponsor! National Retail Security Survey (NRSS) An Interactive Discussion
  2. 2. 2 • 28th Consecutive year survey completed • A total of 41 Questions • 63 Retailers representing multiple companies, banners or brands National Retail Security Survey (NRSS)  Shrink  Staffing and budgets  L.P. Systems and Programs  Internal, External, Vendor Theft  Emerging threats (data security)
  3. 3. 3 63 Retailers, representing multiple brands and over $267B in retail sales. Total Sales $267,852,180,000 National Retail Security Survey (NRSS) FY 2018 Sales Volume $99 million or less 7% $100 million to $499 million 14% $500 million to $999 million 23% $1 billion to $2.49 billion 19% $2.5 billion to $4.9 billion 11% $5 billion to $9.9 billion 14% $10 billion to $24.9 billion 7% $25 billion or more 5%
  4. 4. Overall Inventory Shrink as a Percentage of Sales 4 What was your company’s inventory shrinkage percentage calculated at retail? FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 Average Inventory Shrink as a % to sales 1.38% 1.33% 1.44% 1.38% 1.38% 3% and higher shrink 10.9% 9.1% 9.0% 5.4% 6.6% Between 2% and 2.99% 14.5% 10.9% 14.1% 13.5% 10.5% Between 1.5% and 1.99% 10.9% 12.7% 17.9% 5.4% 13.2% Between 1.25% and 1.49% 10.9% 9.1% 9.0% 17.6% 15.8% Between 1% and 1.24% 3.6% 16.4% 7.7% 17.6% 19.7% Between .50% and .99% 21.8% 20.0% 24.4% 25.7% 18.4% .49% and below 27.3% 21.8% 17.9% 14.9% 15.80% Shrink remains flat over 5 years Companies with higher shrink in 2014 continue to get worse Best performing companies continue to get better
  5. 5. 5 Over the past year, your company’s shrink has… Poll Question #1 A.Increased B.Decreased C.Stayed the same
  6. 6. 6
  7. 7. 7 Shrink - Knowledge Gap • Identifying the causes of shrink in our top tier stores • Combating internal theft through mobile P.O.S. Fraud • Combating external theft through P.O.S Fraud • Understanding the technology criminals use New threats and emerging reasons of concerns
  8. 8. 27% 12% 11% 3% 24% 9% 7% 2% 26% 9% 8% 3% 25% 9% 7% 2% 23% 10% 8% 3% Women Latinx African-American Asian-Pacific NRSS 2019 NRSS 2018 NRSS 2017 NRSS 2016 NRSS 2015 LP Management (or Higher-Ranked Roles) – Representation by Demographic Groups 8 What is the percentage of the following groups in positions of LP manager and above? (averages)
  9. 9. Top Loss Prevention Awareness Programs Used by Retailers 9 Response NRSS 2019 NRSS 2018 NRSS 2017 NRSS 2016 NRSS 2015 Anonymous telephone “hotline” 85.7% 81.0% 90.5% 93.8% 94.6% Discussion during new hire orientation 82.5% 74.6% 81.0% 83.1% 90.5% Bulletin board notices and posters 81.0% 81.0% 81.0% 92.3% 87.8% Code of conduct 79.4% 79.4% 88.9% 90.8% 90.5% Active Shooter training program 65.1% 54.0% 63.5% 61.5% 66.2% Internet, web -based communications 58.7% NA 50.8% 55.4% 55.4% Anonymous online / email notification system 57.1% 42.9% 52.4% 60.0% 55.4% Honesty incentives (e.g. cash & gifts) 31.8% 33.3% 36.5% 56.9% 54.1% Anonymous hotlines remain strong yet incentives for reporting dishonesty continue to fall Awareness as part of new hire orientation is down Code of Conduct trending down
  10. 10. 10 • Training employees to resolve conflict • Add more L.P. Professionals • Enhance employee awareness and training on conflict resolution “Escalated customer service issues are rising, including violence” Loss Prevention awareness, programs and staffing Respondent Concerns
  11. 11. 11 Over the past year, acts of violence in my company’s stores have… Poll Question #2 A.Increased B.Decreased C.Stayed the same
  12. 12. 12
  13. 13. Top 5 Loss Prevention Systems in Use 13 NRSS 2019 % Point Difference From NRSS 2018 % Point Difference From NRSS 2015 Burglar alarms 92.1% + 4.8 - 7.9 Digital video recorders 84.1% + 9.5 - 9.1 Armored car deposit pickups 68.3% - 6.4 - 22.2 POS data mining 65.1% + 7.9 - 4.8 Live customer visible CCTV 61.9% + 7.9 - 13.4
  14. 14. Biggest Movement from NRSS 2019 Compared with NRSS 2018 for Loss Prevention Systems 14 What’s In: NRSS 2019 % Point Difference From NRSS 2018 Merchandise alarms/electronic security tags 46.0% 25.4 Acousto-magnetic, electronic security tags 34.9% 12.7 Check approval database screening systems 55.6% 11.1 Digital video recorders 84.1% 9.5 What’s Out: NRSS 2019 % Point Difference From NRSS 2018 Remote IP CCTV monitoring 57.1% -19.1 Theft deterrent devices (spider wraps, keepers, etc.) 23.8% -17.5 IP analytics 22.2% -9.5
  15. 15. 15 Currently, our I.T. Department allows CCTV to be placed on our company network for remote video monitoring. Poll Question #3 A.Strongly Agree B.Somewhat Agree C.Somewhat Disagree D.Strongly Disagree
  16. 16. 16
  17. 17. 17 Installation of remote IP CCTV monitoring in my company is… Poll Question #4 A. Increasing B. Decreasing C. Remaining the same D. No future plans to install
  18. 18. 18
  19. 19. 19 Our IT Department allows for alarm systems on the company network Poll Question #5 A. Strongly Agree B. Somewhat Agree C. Somewhat Disagree D. Strongly Disagree
  20. 20. 20
  21. 21. Actions Taken Against Dishonest Employees 21 FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 Apprehensions (average) 322.6 506.1 345.6 865.3 834.0 Terminations (average) 335.0 397.8 333.2 552.7 651.6 Prosecutions (average) 91.3 104.4 93.3 158.3 209.6 Civil demands (average) 159.8 125.1 114.5 344.5 344.5 How many dishonest employee apprehensions, terminations, prosecutions and civil demands were made? Apprehensions continue to decline, dramatically. Down 61% since FY 2014. In FY 2018 Prosecutions occurred in only 28% of apprehensions
  22. 22. 22.2% 11.1% 3.7% 9.3% 7.4% 24.1% 16.7% 5.6% Up to $249 Between $250 and $399 Between $400 and $499 Between $500 and $749 Between $750 and $999 Between $1,000 and $1,999 Between $2,000 and $4,999 $5,000 and above Average=$1,264 FY Year Average FY 2018 $1,264 FY 2017 $1,203 FY 2016 $1,923 FY 2015 $1,234 Average Loss per Dishonest Employee Case (FY 2018) 22 Flat over the past 4 years
  23. 23. 23 Criminal prosecution is low in employee dishonesty cases because of… Poll Question #6 A. The amount of time testifying in court B. The risk of losing in court and subsequent liability C. Lack of evidence to prosecute D. All of the above E. None of the above
  24. 24. 24
  25. 25. 25 Dishonest employee apprehensions have declined over the past 4 years because of… Poll Question #7 A. Better loss prevention controls B. Better loss prevention systems C. Reduction of store loss prevention personnel D. All of the above E. None of the above
  26. 26. 26
  27. 27. Actions Taken in Shoplifting Incidents 509 370 370 1105 728 544 1441 742 309 3323 1935 2201 3455 2739 1216 Apprehensions Prosecutions Civil demands FY 2018 FY 2017 FY 2016 FY 2015 FY 2014 27 How many shoplifting apprehensions (i.e. stops), prosecutions, and civil demands were made? (averages) % of Prosecutions to Apprehensions FY 2018 72.7% FY 2017 65.9% FY 2016 51.5% FY 2015 58.2% FY 2014 79.3%
  28. 28. 9.8% 17.1% 7.3% 2.4% 17.1% 17.1% 7.3% 7.3% 14.6% Up to $49 $50 to $99 $100 to $124 $125 to $149 $150 to $199 $200 to $299 $300 to $499 $500 to $999 $1000 and over Average=$546.67 Average Dollar Loss per Shoplifting Incident (FY 2018) 28 FY Year Average FY 2018 $546.67 FY 2017 $543.28 FY 2016 $798.48 FY 2015 $376.80
  29. 29. 29 The #1 reason shoplifting apprehensions have dropped is because of… Poll Question #8 A. Safety concerns B. Reduction in store Loss Prevention (floor walker) positions C. Liability Concerns (false arrest, false imprisonment, etc.) D. Lack of return on investment E. All of the above F. None of the above
  30. 30. 30
  31. 31. Average=$2,885.15 Average Dollar Loss per Robbery (FY 2018) 31 FY Year Average FY 2018 $2,885 FY 2017 $4,237 FY 2016 $5,310 FY 2015 $8,170 Average loss has declined by 65% since FY 2015 41.5% 11.3% 9.4% 11.3% 9.4% 7.5% 9.4% Up to $199 $200 to $499 $500 to $999 $1000 to $1999 $2000 to $4999 $5000 to $9999 $10000 and over
  32. 32. 32 The reason loss per robbery incident has dropped 65% since 2015 is because… Poll Question #9 A. More customers using debit/credit B. There are better controls to secure cash C. There is less robbery D. All of the above E. None of the above
  33. 33. 33
  34. 34. Adoption of Sophisticated Technology For threat prevention purposes, has your company implemented any of the following LP- related emerging technology countermeasures? (% who have already or plan to implement in next few years) 34 88% 56% 22% 19% 11% 10% POS Analytics Solution Provider Video Analytics Fingerprint ID Facial Recognition NRSS 2019 NRSS 2018
  35. 35. Merging of Loss Prevention and Cyber How often are you involved in your organization's cybersecurity issues? 16% 14% 30% 30% 10% Always Very often Sometimes Rarely Never 35
  36. 36. Merging of Loss Prevention and Cyber There is increasing overlap between LP and cybersecurity priorities. 89% 11% Agree Disagree 36
  37. 37. Merging of Loss Prevention and Cyber Continued In what specific areas are you working with your cybersecurity colleagues? 60% 58% 53% 53% 44% 40% 26% 5% Incident response Awareness / training Risk mgt. and compliance Investigation / forensics Disaster Recovery and BPC Personnel security / insider risks Threat analysis Other 37
  38. 38. Merging of Loss Prevention and Cyber Continued Do you feel you’re as involved as you should be? 28.6% 25.4% 33.3% 12.7% Yes, definitely Yes, somewhat No, not really No, definitely not 38
  39. 39. 39 In my organization, clear direction (ownership) on the protection of data and personal information in stores between IT Security and/or Loss Prevention has not been clearly defined Poll Question #10 A. Strongly Agree B. Somewhat Agree C. Somewhat Disagree D. Strongly disagree
  40. 40. 40
  41. 41. 41 In my organization, the relationship between LP and IT security is… Poll Question #11 A. Excellent B. Good C. Needs some improvement D. Have no relationship
  42. 42. 42
  43. 43. 43 Response NRSS 2019 NRSS 2018 NRSS 2017 NRSS 2016 NRSS 2015 Increasing significantly (20% or MORE over 2018) 4.8% 3.2% 4.8% 12.3% 1.4% Increasing somewhat (1% to LESS than 20%) over 2018 39.7% 33.3% 30.2% 30.8% 38.0% Remaining flat 31.8% 42.9% 33.3% 24.6% 36.6% Decreasing somewhat (1 to 20% LESS than 2018 levels) 19.1% 12.7% 23.8% 30.8% 22.5% Decreasing significantly (Over 20% LESS than 2018 levels) 4.8% 7.9% 7.9% 1.5% 1.4% Loss Prevention staffing and Budgets Compared with last year, is your LP budget in 2019 increasing, decreasing or remaining the same?
  44. 44. 44 All 500 or fewer stores More than 500 stores Yes, technology resources 56% 57% 55% Yes, other budget resources 35% 43% 27% Yes, staff resources 29% 20% 36% No 32% 33% 30% Loss Prevention Staffing and Budgets Is your company allocating additional resources to address risks this year?
  45. 45. 45 All 500 or fewer stores More than 500 stores Analytical 61.9% 63.3% 60.6% Cybersecurity 39.7% 43.3% 36.4% Investigative 34.9% 43.3% 27.3% Computer skills 33.3% 36.7% 30.3% Leadership 28.6% 16.7% 39.4% Emotional intelligence 28.6% 23.3% 33.3% Interviewing 15.9% 16.7% 15.2% Other (please specify) 4.8% 6.7% 3.0% Employee skill sets needed for LP department success What skills do you believe you need more of in your loss prevention department for your programs to be successful or grow?
  46. 46. 46 I believe the NRSS survey is valuable and I support having it continued Poll Question #12 A. Strongly Agree B. Somewhat Agree C. Somewhat Disagree D. Strongly Disagree
  47. 47. 47
  48. 48. To download a copy of this report: • Create a MyNRF account on NRF.com • Once logged in, use the search tool and input “NRSS” • You can also visit:nrf.com/resources/retail-library/national- retail-security-survey-2019 48

National Retail Security Survey Interactive Discussion

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