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Ed HeskettLoss Prevention Manager
How Data Helps Operators Find & Fight Theft
#DelagetLPWebinar
Goals for Today’s Webinar
Answers to the following questions:
> What data types should I follow in order to prevent theft?
> Why should data be part of every loss prevention plan?
> How can following the right theft metrics save me time and money?
> Why does data analytics play a key role in preventing future theft?
#DelagetLPWebinar
Agenda
+ Additional Thoughts Before We Get Started
+ POS Theft As Seen In COGS
+ Data Points – COGs
+ Data Points – POS/Cash
+ Thresholds / Goals
+ Tracking / Trends / Anomalies
+ Recap / Setting Goals
#DelagetLPWebinar
Opening Thoughts+ Analyzing data is time consuming, but necessary
+ Think about analyzing data as checks and balances.
+ Someone at the store level and above store level needs to own the data process, tracking, following up
+ Build regular data checks into your schedule
+ The more effective the store level team is in executing your brand standards (daily, weekly, periodically), the better
+ Understanding the numbers for what they are removes the emotion that often comes with performance and non-performance
+ Systems = “a method of regularly inspecting what you expect”
+ Commit to doing things differently than you are now.
#DelagetLPWebinar
POS theft as seen in COGS
+ It’s too late…when you see the loss / theft in your COGS
> The theft or loss isn’t identified until seen in the COGS, perhaps even over a period of time
> Lost Revenue = Increased COGS = Food Served, Labor to Prepare The Food
> At this point, you are reacting and in some cases playing “whack a mole” to get to the root cause
#DelagetLPWebinar
First Data Points
Store Level – COGS
+ Daily Variance Reports: Critical Few – Accuracy – No Bounce Backs+ Weekly Variance Reports: Complete – Accuracy – No Bounce Backs+ Transfer Reports / Summaries – Ghost Transfers+ Period End Inventory Results+ Beverage and Paper Cost Targets as a percentage of sales+ Calculating, tracking, trending “days in inventory”+ Example, inventory turns, increasing inventory, steady or
improving PCV
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Beverages+ Set goals / targets to monitor:
> Usage> Growing inventory on the shelves> Potential theft
+ 3% to 4% is a good starting point
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Paper Cost#DelagetLPWebinar
+ Target 2.5% of sales as your target
Inventory Alerts#DelagetLPWebinar
Calculating Days in Inventory
+ Beginning Inventory and Current Inventory (ending) should be relatively close to each other in dollars
+ To calculate “days in inventory”:> Current inventory dollars, $5497 /
Total COGS, $30,726 = .1789.> .1789 x 28 (days in a period) = 5 days.> Influenced by delivery day, volume, case
count / size on slower moving inventory
+ Set store goals, monitor trends
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Inventory Tracking#DelagetLPWebinar
+ Example #1 > Days in Inventory> Red Flag Usage
Inventory Tracking#DelagetLPWebinar
+ Example #2 > Improving PCV> Increasing Inventory> Inventory Turns
Protect Your Sales & Cash With Data Points
Store Level – Cash
+ “Professional thieves” steal on a budget….daily, weekly, and periodically
+ POS Register Tapes & Cashier Reports – Automated / Manual+ Transaction Compliance / Cashier Performance Log+ Armored Car Users – End of Shift Reports+ Shift Change Documentation – Handing off the safe+ Validated Deposit Slips+ Weekly Schedule (follow up on scheduling
and deployment of the cashiers)
#DelagetLPWebinar
Register Tapes / POS Settlements#DelagetLPWebinar
Pay Attention To The Details
+ Typically, MICs focus on one number: cash accountability… “how much cash am I suppose to have?”
+ What else is the shift close tape / report telling you?
+ Deletions in this example are acceptable ($107, 4.85%) …but are they?
+ Over rings / voids > 1 for $3.20> Is there documentation
+ Employee meals / other discounts> 10 for $29.48 on a late night cash drawer> Documentation?
+ Coach, train, feedback with the cashier NOW!
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Accountability for Cashiers
+ Store level compliance is a must - every meal slip, every void / refund slip, and deletion performance.
> Handle missing documentation like missing cash!
+ And the MIC – What is their role in compliance?
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Trends and Comparisons
+ Trends can only be identified through tracking, manual or web-based solutions.
> Manual cash performance logs> Track metrics by cashier, over time
+ Web-based programs do the work for you - compares cashiers, identifies trends.
Cashier Comparison#DelagetLPWebinar
Cashier Trending#DelagetLPWebinar
Cashier - Shift Results#DelagetLPWebinar
A Single Transaction…innocent or theft?#DelagetLPWebinar
Example of Questionable Discounting#DelagetLPWebinar
The Power of Total Metric Tracking
+ Example of 7.0% of sales - for a location / cashier, over time> Totals found in manual tracking or on a Dashboard> Your brand may vary
+ Deletions before = 5.50%+ Deletions after = .20%+ All discounts = 1%+ Voids / Refunds / Over Rings = .10%+ Cash +/- = .20%
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Dashboard Example…..Theft Occurring
Sales $ O/R % Deletes % Emp Meals % Total %
371,814.12 0.29 10.90 0.99 12.18
370,218.19 0.14 9.16 0.49 9.80
293,473.30 0.28 10.56 0.95 11.79
292,518.09 0.46 14.15 1.26 15.87
383,196.85 0.19 9.29 0.38 9.85
378,618.54 0.31 10.84 0.64 11.79
312,252.43 0.35 12.19 1.13 13.67
389,737.56 0.20 11.09 0.75 12.04
298,319.16 0.13 10.14 0.89 11.16
3,090,148.24 0.26 10.84 0.81 11.90
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Where Do You Go From Here?
+ Investigate
+ Review transactions, trends / if available
+ Review schedules - common employees working?
+ Review DVR Footage
+ Who is “really” working the register?
+ Review manager register codes
+ Surprise cash audits
+ Speak with the employee(s)
+ Set goals / daily feedback
#DelagetLPWebinar
Recap of Today’s Goals#DelagetLPWebinar
Answers to the following questions:
+ What data types should I follow in order to prevent theft?> Web-based solutions work best. COGS Trends / POS Trends> POS reports, from POS or Back of the House Systems> Follow deletions, voids, discounts> COGS Reports (cost of beverage, cost of paper, PCV results, over time)
+ Why should data be part of every loss prevention plan?> Removes the emotion from the performance…believe the numbers.> Keep the team’s eyes on what is really important…your team / your guests.> Better productivity / positive work environment
Recap of Today’s Goals#DelagetLPWebinar
+ How can following the right theft metrics save you time and money?
> Addressing anomalies as they occur> Tracking and addressing outliers, and addressing the issues before they blow up> Keep you out of investigations and working on what is really important> One organization reduced discounts by .25% = $300,000 / year!
+ Why data analytics play a key role in preventing future theft.
> The name of the game is get the money in the register.> Well controlled POS metrics will increase your sales and reduce / prevent theft.> Increased Profits
#DelagetLPWebinar
Questions
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