Employee Theft – Are You Hiring a Thief?

Shoplifting is always a problem for retail stores.  The millions of dollars of lost revenue is most often attributed to those shoppers who come into stores and end up shoplifting merchandise.  Unfortunately, most retail theft is right under the nose of managers and store owners in the form of employee theft.

In 2014, employee theft accounted for about $18 billion in lost revenue in the United States alone.  That amount is almost 43 percent of all the lost revenue by retail stores.  Globally, that number is 28 percent of lost revenue by employee theft.

One study shows from Global Retail Theft Barometer states that employee theft often happens at the time of checkout. The employees that do this have learned to manipulate the system so that their transaction benefits themselves or someone associated with them. 

When we think of theft and shoplifting, we tend to get a picture of someone physically taking merchandise and removing it from the store.  Employee theft comes in many different forms.  It can happen when employees enter refunds, provide discounts, void a transaction, or say someone used a coupon when they didn’t actually provide one.  All of these things are manipulations of the system which result in loss for a retailer.

In an article recently published in Forbes Online, one of the key factors in employee theft is lack of quality supervision and ineffective pre-employment screening.  For retailers, unfortunately their turnover rates are fairly high, which means there is a true lack of loyalty for the company.  A quality employment screening is a key component in attempting to weed out those whose intention are to take advantage of the retail store.  A background check cannot predict future behavior, so while it is not fool proof, it can alert a hiring manager if prior employment activity, theft or other criminal behavior is in the applicant’s past.