Small Business Loss Prevention review

The Magic of The Loss Prevention Review is that it gives you visibility to the future

Sometimes the term is used loosely in retail, and many small to mid-sized companies have a very specific understanding of the term “audit”. It represents to them some form of complex financial review, or a third party regulator’s review looking for fraud. Quite frankly, it’s a bit daunting.

Let’s simplify this and call it a Loss Prevention “review”.

Like an audit, a review should be looking for compliance. Compliance with the operating practices you expect of your team.

Shrink occurs when an exception to standard operating practice occurs. 

In terms of shrink related to administrative errors, somebody took a shortcut or didn’t follow the proper process for conducting business.

In terms of internal theft, the appropriate deterrent measures failed somewhere, or the controls you put in place to make sure internal theft risks are reduced were circumvented.

In terms of customer theft, the level of protection against this was inadequate. The customer service just didn’t cut it.

Inspect what you expect

So if shrink is the result, you need an early warning system of the contributing factors to change the trajectory of the activity that may give you a negative result. That’s the magic of a loss prevention review. It should be a part of the operation of your business, not something left on the sideline. Build it into the overall process. Like putting a seatbelt on before you drive, it becomes part of the overall function. 

If you do not have a loss prevention review in place now,  how do you know your business is operating in compliance with your expectations? If it is, there’s no room to shrink. Think about it, wouldn’t you sleep better at night knowing everything is humming along as you want it to?

Read more about how to build your Loss Prevention Review here.