Securing your stock involves detection – and inspection.

Don’t stint on safety

Published:  17 January, 2011

When sales are down, there is a temptation to slash budgets and security expenditure. But, there are measures merchants can take with little or no outlay to prevent losses in their branches. Lisa Arcangeli reports.

Richard Rafferty, UK operations manager of Checkmate Security Group, estimates that UK merchant’s lose between 1% to 2.5% of their annual turnover to unknown shrinkage. “By adopting a few simple steps, a merchant will find that those shrinkage figures will come down appreciably,” he says.

“During the recession, most builders’ merchants have had to reduce the number of staff in the yard. That means customers have more time alone in the yard and for much of that time they are able to load goods for themselves, go to the sales counter and declare pretty much what they want.”

“Often, the merchant won’t know until after stocktake that more is being taken out of their yards than is being paid for. The key to halting this type of widespread theft is all about ‘the approach’. This is one of the most effective, least time-consuming and most beneficial way of keeping a tight grip on the yard.

“When the builder drives into the merchant’s yard, the yardman should stop unloading supplier vehicles or whatever else he is doing and approach the customer. This is an area we always target when we conduct our test purchases. If we are not approached, we will load our own vehicles with considerable extras and often go into the sales counter and declare that we have had, for example, one bag of cement when we have loaded 10 bags and some timber. This leads to severe stock loss, and if we are doing it, the regular customers will be doing it everyday.

“Not only is there a security aspect to it, but there is also the customer service element. If a customer had planned to act dishonestly and they are approached on entry into the yard by a helpful yardman, they will be put on the back foot,” Mr Rafferty says.

If a merchant uses yard paperwork, such as a tally note system, there must be a check by the yardman prior to issuing the tally note to make sure that what the customer has declared to the yardman is what is actually on the back of the vehicle. “It is all too easy for the yardman to take the customer’s word,” Mr Rafferty points out.

If the merchant uses a ticket-first yard procedure, whereby the customer has to go to the sales counter, state what it is they want to buy and then go into the yard to collect it, then a vehicle check after loading is vital. “There has to be a physical check on the vehicle by the yardman to ensure that what the customer is claiming he has taken, has been taken, and no more than that.

“With no checks in place, the merchant is totally reliant on customer honesty,” says Mr Rafferty. “In this industry, that is setting yourself up for a fall,” he adds.

Checkmate recommends that merchant staff should always have some form of security awareness training.

It can be delivered by an external company or in-house. “Everyone should be aware of security risks and threats.”

Security training is not expensive. “For a staff of 24 for example, all of the merchant’s branch staff could be trained for around £500 for a day’s tailored package. Security awareness training is all about understanding and being able to identify how and why people are dishonest and why they act this way.” Prevention is always better than stock loss.

For merchants who may have had to downsize, Mr Rafferty suggests that a branch re-tasks its team. “A merchant could also re-zone their yard so there is a designated customer service point. While the customer is waiting there, the yardman can go serve that customer. This will cut down on self-loading, and make it more obvious if customers are unattended.”

“If a merchant has three yardmen, one could be the ‘floating’ customer service operator and the other two could deal with opposite sides of the yard. This has positive effects – offering both customer service and security.”

 

This article was first published in the November 2010 edition of Builders' Merchants News.

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