Preventive Measures To Reduce Shrink Levels
Preventive Measures to Reduce Shrink Levels
As of June 2005, the inventory shrinkage report for store #594 has increased by 37.3%. This amount was reported as 11.7% shrink percentage which equates $25,925.00 in dollar value. This is unacceptable to the company. The company has specific goals set to accommodate the loss of product. The company goal is 2.75%, the dollar amount varies due to the specific merchandise each store receives. In previous quarters store #594 would run a 3.69% shrink percentage and approximately $7,325 in dollar value. This has been its norm since it’s opening in 2004.
In looking at the sudden increase in shrinkage, I had to evaluate any changes since the last acceptable inventory. This would include the store staff, the shipment process and the inventory crew.
There was a change in management in May 2005, which led to a few turnovers in the sales staff. Total there is approximately 60% new employees. In looking at the employees, I noticed one particular manager always clocked out later than the others even on days when there wasn’t big projects assigned or floor moves scheduled. While investigating I discovered she stayed late to review the policies and procedures manual because she wasn’t allowed to take it home.
The second step in checking out the staff was to explore policy and procedures to insure they were being followed. This would include observing the sales staff as well. After numerous hours of observation I concluded some procedures weren’t being followed. 1. purse and property checks – every employees must have their purse checked and any property purchased while on duty in store #594 or any other store related to or not related to store #594 must have a receipt to prove purchase. 2. two people must check in shipment when it arrives to verify the count and accuracy of each shipment. 3. No one is allowed in the store by themselves at anytime. In...
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