Put the Stock Back in Out-of-Stocks: Affordable RFID Solutions

The movement of goods is the ultimate goal for any retailer. But what happens when a retailer is unable to move goods into the consumers’ hands because of out-of-stock issues?

According to Jacqueline Renfrow at fierceretail.com, over 75% of adults found a wanted product to be out-of-stock during store visits over the last 12 months. In the same period of time, 63% of online shoppers experienced the same out-of-stock error messages. Retailers lost 58% of these sales and 65% of the online sales.

New research from IHL Group attributed a $634.1 billion loss due to out-of-stocks. Greg Buzek, IHL Group President said, “Retailers can realize huge gains by addressing opportunities that are in hand and slipping through their enterprise fingers.”

Many factors can lead to embarrassing and costly out-of-stock scenarios for retailers, such as:

  • Underestimating the demand for a product
  • Miscalculating the time needed for the supplier to deliver the product
  • Late delivery by a supplier
  • Product quality issues
  • Shortage of working capital

Those who have been in business long enough know that some situations cannot be controlled. But what can be controlled, should be controlled. Inventory visibility is something retailers can control with confidence.

“The ability to sense and respond to demand through greater inventory visibility and intelligence is critical for retailers,” explains Bryan Nella, director of corporate communication at GT Nexus.

It is time to take control with ControlSpan, CONTROLTEK’s inventory visibility system (IVS). ControlSpan is true inventory visibility made easy. ControlSpan is a modular solution built to allow freedom of choice at the beginning of an RFID deployment, to grow with the demands of the organization, and provide options at all levels instead of being locked into a single, siloed offering.

The Proctor & Gamble Company sponsored a study, A Comprehensive Guide to Retail Out-of-Stock Reduction in the Fast-Moving Consumer Goods Industry, which discovered RFID showed great promise to solving the out-of-stock epidemic. The report states that “new retail support technologies, such as RFID, have changed our thinking about OOS as a single problem, to separating OOS examination to ‘not in the store’ and ‘not on the shelf’, which is key to truly understanding the out-of-stock epidemic.

Eric Green, CEO and Co-Founder at Askuity, attributes out-of-stocks due to poor data-syncing, accuracy failure of Perpetual Inventory (PI) systems, and distorted demand forecasting…flaws ControlSpan can resolve.

Bill Hardgrave, Dean of Auburn University’s Harbert School of Business and an expert on RFID adoption in retail, said the technology’s reliability and economic benefit have been well-established. Hardgrave adds, “RFID enables retailers to know what they have, and where they have it.”

Request a demo today and see how CONTROLTEK’s ControlSpan suite offers end-to-end inventory and process management solutions that allows not only improved visibility but also enhanced profitability and customized integration. CONTROLTEK’s solutions help make existing systems more efficient and accurate.

As any retailer would agree, inventory visibility is the cornerstone to meeting product demands and protecting the trust consumers place in the company brand.

Top 3 Reasons Why ORC may be Smaller Fish in the Shrink Sea

What is ORC?

The National Retail Federation (NRF) defines Organized Retail Crime (ORC) as, “theft/fraudulent activity conducted with the intent to convert illegally obtained merchandise, cargo, cash, or cash equivalent into financial gain (no personal use), typically through online or offline sales. Organized retail crime typically involves a criminal enterprise that organizes large-scale thefts from a number of retail stores and employs a fencing operation to sell the illegally-obtained goods for financial gain.”

ORC: The Smaller Fish in the Shrink Sea?

Shrink rates can be lowered by either decreasing the amount of inventory shortage or by increasing sales, The Calibration Group’s whitepaper, “SOH: The Retail Problem That’s 7 Times Greater than ORC” reveals. Accordingly, ORC may no longer be considered the biggest threat to retailers’ bottom lines from a Loss Prevention perspective. The Top 3 reasons to consider when pondering this comparison:

  1. ORC costs North American retailers a staggering $34.67 billion a year, but the $252.9 billion stock-on-hand (SOH) issue overshadows ORC by more than 7:1.
  2. If North American retailers eliminated ORC entirely, profit earned from the $34.67 billion in merchandise now available for sale would be $1.04 billion.*
  3. If North American retailers resolved their SOH issues and recouped the lost sales, the profit earned from the $252.9 billion would be nearly $7.6 billion.*

* Calculations based on 3% net profit margins

The Four-letter Solution

An inventory visibility system (IVS) with RFID technology offers retailers clear insight into their inventory at any given point in time. RFID, along with a comprehensive, yet simple software application, has now become the solution that can easily be embedded into any retail framework. An IVS system with RFID provides store personnel with key inventory management data, such as how many items are in back stock and on the sales floor, which in turn allows the staff to manage inventory more “real-time” by making necessary adjustments.

This technology also provides the ability to take a full inventory of the store within minutes as opposed to hours. Loss Prevention professionals can now enhance profitability more effectively by increasing sales while simultaneously lowering the shrink rate.

Asset Protection: Spelling out some key terms for all employees

As a loss prevention leader, you’re certainly familiar with all the main terms surrounding inventory security. And if there are other employees working in your store’s loss prevention division, they probably know these terms as well. But members of the LP team aren’t the only team members who need to be up on their inventory security lingo: There are certain key terms that all other store employees need to know as well.

“All store employees need to be up on certain inventory security terms.”

That’s because when it comes to inventory security, it represents a group effort. When dealing with a store whose inventory security knowledge is limited to only a few individuals, what happens if those people aren’t around and a shrink-causing incident occurs? Having staff members who know what they’re doing in terms of inventory management and security can help eliminate this kind of scenario.

To get store employees up to par in terms of inventory management and security jargon, we’ve decided to put together a list of some of the key terms. For store employees, knowing these terms and how they fit into a business’s broader asset protection plan is vital for playing a necessary role in limiting incidents that compromise security:

Shrinkage: In the retail sector, it’s imperative to keep track of items from when they’re received to the moment they leave a store with a paying customer. Shrinkage refers to item losses in the time period between the point of receiving and the point of sale. If employees notice a discrepancy between the number of items delivered to the store and the number of items that are on the shelf, this is a common situation that reveals shrink. Shrink can also be discovered at other points in the lifecycle of a product, such as damages or product expirations.

Shrink encompasses more than theft alone. While it’s true that theft incidents constitute a large part of shrink causation, there are other things that also cause shrink, including administrative/paperwork errors and vendor fraud/error. For retail stores, shrink figures are far from insignificant, with the average retailer reporting a shrink percentage of 1.22 in 2014.

One key reason why shrink numbers are so high, as National Retail Security Survey (NRSS) lead study author Dr. Richard Hollinger explained, is because shoplifting groups are growing in sophistication, with “gangs of thieves … using a lot of skills … [and] doing investigations prior to the thefts.” This is all the more reason to have store employees know what shrink is, how it occurs and how to prevent it.

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Shrink is the difference between what is supposed to be in the store according to the inventory management system, and what is actually in the store.

RFID: Radio-frequency identification is a system that offers multiple functionalities, including EAS (electronic article surveillance as outlined below) as well as for providing increased inventory visibility, throughout your entire supply chain. When it comes to loss prevention, RFID is a great technology to harness because it allows for highly robust tag monitoring via readers that are either handheld or mounted for hands-free operation. RFID technology also offers stores significant data benefits, since information can be more quickly accessed using the technology. This makes RFID a vital part of overall supply chain management as well.

EAS: Electronic article surveillance is the primary technology used by stores to limit instances of shoplifting and drive down overall shrink. According to experts, the deployment of EAS technology can drive down theft by 60 percent or higher. The way EAS works is through a system of tags that interact with specially designed gates or overheads. If a tag isn’t removed by a store employee, the gate/overhead will detect this and trigger an alarm. In this way, shoplifters can be caught in the act. Beyond that, however, the presence of tags and gates/overheads present thieves with a strong deterrent to commit a crime in the first place, since good EAS systems are highly reliable.

RF Systems: Radio frequency systems are so named because they rely on electromagnetic – aka radio wave frequencies. In terms of inventory management and security, this technology can be centrally helpful in keeping thieves out of your stores. One prime example of RF technology in action is CONTROLTEK’s first-rate pedestals (the i30 and i45), which provide a seamless presence in any store environment.

As Dr. Hollinger pointed out, today’s retail climate is one in which loss prevention professionals have to contend with far more sophisticated criminals who work in well-planned groups to get away with theft. To deal with threats like these, stores need to mount equally sophisticated defensive strategies. Here at CONTROLTEK, we’ve built a powerful line of inventory security products that provide stores with cutting-edge security solutions that can help to significantly limit store losses. But for stores to drive down shrink even more, it helps to have all staffers on the same page, and teaching them the fundamentals of Shrink, RFID and EAS is a great place to start.

The Not-So Holiday Checklist

With the influx of customers during the holiday months, most businesses’ have taken measures to be certain their existing inventory strategies are well thought-out, and that their stores are well prepared for the added security and other inventory protection needs that come with the holiday season. All of this preparation is designed to ensure the retail stores are operating on all cylinders in order to successfully meet the demands of the holidays, while preventing losses due to theft. But what happens when the holidays are over? How can retailers ensure that all of their pre-holiday “best practice” efforts transcend throughout the entire next year?

To help prevent thefts from occurring, and to provide legitimate customers with the best shopping experience possible, we’ve created a checklist for all retail stores not only for the lead-up to the holiday shopping rush, but to use throughout the year. Take a look at this list to see if all of these things are in place:

  1. Product tagging system: The holiday rush provides exactly the kind of hectic shopping environment that thieves love to take advantage of. If your store doesn’t have an EAS tagging system in place, what’s preventing shoplifters from just walking out the door with merchandise amid the crowd of shoppers? CONTROLTEK’s line of EAS Tags offers stores a robust arsenal of tagging solutions for every product type, for every day of the year.
  2. Prepared staff: Are your employees ready to not only provide stellar customer service this shopping season and beyond, but also to help weed out potential shoplifters? For asset protection, it’s vital to equip all employees with the skills and technology to help deter shoplifters.
  3. Top-tier inventory oversight: If there’s ever a time that a particular item in your store is going to sell out quickly, it’s during the holiday season. The frequency with which purchases are made over the holiday months means that inventory managers have to elevate their oversight. Otherwise, the store could get a reputation as the place that never has the items customers want. Stopping this issue from happening means taking steps to refine inventory control to a process that runs like a well-oiled machine. This includes:
    1. Harnessing RFID active inventory control software to provide store leaders with an up-to-date picture of a business’s inventory.
    2. Using handheld RFID readers to make inventory scanning a highly expedient process.
    3. Ensuring a strong line of communication between leaders at the store and those at product stocking sites. By doing this, stocking requests can be more quickly fulfilled as popular items fly off the shelves.
  1. Cash transfer solutions in place: More customers mean a lot more cash in the registers, and stores will have to look into their currency transfer methods as the need to safely handle cash inflow increases. When it comes to store deposits and cash transfers, retail deposit bags from CONTROLTEK provide retailers with a highly secure means of transferring cash for deposit. Among the features included with these bags are tampering protection and robust sealing technology. Check out CONTROLTEK’s tamper-evident bags

Considering that we’ve been open since 1976, CONTROLTEK has seen its fair share of holiday shopping seasons, as well as the challenges retailers face on a daily basis. While the shopping landscape has changed in the past 30 years, the need to maintain a high level of inventory protection hasn’t. That’s why we’ve designed Inventory Security Solutions (ISS) that are built to meet the security needs of today’s stores and put retailers in the best possible position to be more profitable as the holidays approach…and throughout the year.

Theft Free Holiday

Holidays are about family, friends and celebration, but gifts aren’t exactly a small part of the equation either. When the holiday season kicks off, retail stores can expect a significant uptick in customers and sales. According to the National Retail Federation, this past holiday season – which ended in December 2014 – represented the highest in terms of holiday retail sales figures since 2011.

As NRF President and CEO Matthew Shay put it at the time, “There is every reason to believe we have moved well beyond the days of consumer pessimism and that the trajectory for retailers continues to point up.”

Shay’s assertion suggests that this holiday season may be even better than the last in terms of sales. But for stores, the great sales figures that the holidays bring can often be overshadowed by a rise in something far less desirable: theft.

Retail is a main target in holiday crime
Unfortunately, holiday sales aren’t the only things that have gone up recently – so have holiday theft statistics, with retailers tracing a 30 percent increase in such incidents. These days, 95 percent of retail stores have experienced theft, which points to what a pervasive issue it is. While there’s no one single way to prevent shoplifting incidents from happening, there are key steps stores can take to minimize such crimes, including:

  • Hiring well-trained staffers who can provide an optimal level of customer service, thereby deterring thefts
  • Having better detection technology in place at exits to prevent items from being swiped out of the store
  • More actively monitoring inventory to ensure no discrepancies arise

Stores aren’t the only ones that face holiday threats
While it may seem that retailers are hit the hardest in terms of theft during the holiday months, individual consumers also face a significant degree of risk. One, for instance, comes in the form of ATM threats. Recently, there has been a 174 percent increase in such incidents.

Another common scheme consumers can fall victim to is the email scam. Is there an email in your inbox from your favorite holiday-themed store promising a special discount just for you? While it could be legitimate, it could also be a sophisticated phishing message from cyber thieves, who are convincingly posing as a sender you recognize in order to get you to disclose private information. These days, 11 percent of identity theft happens via technology, and with cybercriminals using more sophisticated and targeted methods, that number will undoubtedly rise.

But it’s not just technology that consumers have to worry about. With 43 percent of identity theft cases caused by things like stolen credit cards and wallets, people also have to be concerned about their physical documents getting swiped.

How CONTROLTEK can help make your holiday theft-free
Here at CONTROLTEK, we want to do our part to ensure that this holiday is a secure one. Here are some of the tools we offer that elevate holiday security:

  • Triplok security bags: Our Triplok bags are top-of-the-line for securing currency in transit. With a triple seal closure and stringent detection mechanisms in place to identify any attempted tampering, these bags are the industry standard. As such, they’ve earned the Vault Process Certification (VPC) standards seal of approval, making them the go-to resource for cash management professionals.
  • Tamper-evident security seals: As a global leader in security seals, we set the standard for this kind of technology. Whether it’s security totes, cash bags, ATM cassettes or other things you’re looking to secure, we’ve got a seal for your specific need.
  • Deposit tickets and endorsement stamps: Deposit tickets and endorsement stamps offer an additional – and vital – layer of security when it comes to sending items. Our deposit tickets come in two forms, books or loose, while our stamps include a self-inking endorsement option. This is the kind of resource that helps you stay one step ahead of a prospective thief.

Retailers and individuals deserve to enjoy the holidays. With CONTROLTEK solutions, you can spend more time on enjoyment while knowing that your security is in good hands.

How to Ship Bulk Coin With Peace of Mind

Tough plastic deposit and transfer bags withstand transit handling

How do you transport 50 pounds of quarters? Or dimes? Or nickels?

With a very strong, see-through, tamper-resistant plastic money deposit bag. But not just any bag will do. The movement of coin from one location to another is such an important undertaking that it has spawned the need for special products. CONTROLTEK’s CoinLOK® tamper evident coin bags are among them.

These bags were developed to meet strict standards, including the elimination of breakage. The weight of loose coins can add up. Bags can hold 25 pounds or 50 pounds and are intended for one-time use. Custom sizes and imprints also are available. The bags also feature reinforced, die-cut triple-ply handles molded into their construction for easier and safer bulk transport.

Anyone who has tried to lift a 50-pound bag of potting soil, mortar cement or rock salt will appreciate the option of a 50 pound coin bag having two handles, top and bottom, so that two people can assist each other during transport.

The CoinLOK® bags get loaded with loose coin, and then processed and sorted. Barcodes are positioned on the bags as easy targets for handheld scanners, and numbering on bag labels is large enough to be read by security cameras for an audit trail. These bags also have dual write-on receipts, as well as a write-on bag-shipment information panel.

Major armored couriers prefer the CoinLOK®  brand of deposit bags and endorse them.