Shrinkage through theft has been well documented as being an area of major concern for all retailers, with estimated losses industry-wide close to £2 billion in the UK over the past 12 months.
One of the UK's leading supermarket chains, Sainsbury's, with an estate of 558 stores and 240 petrol filling stations (PFS), admits to suffering losses in line with average figures for the retail industry.
Sainsbury's technical security specialist Ray Waddington has been responsible for technical aspects related to the security of the Sainsbury's estate for the past nine years. Waddington explains that known and unknown losses need to be clearly defined. Shrinkage is a combination of both kinds and is estimated at millions of pounds, he elucidates, "If you do not know where the problem is you cannot tackle it. You need to know the greatest problematic areas and tackle them first. Most shrinkage occurs when the store is trading."
Waddington identifies three of the main areas for known losses as: shoplifting, burglary and robbery. Traditionally, shoplifters steal high-value consumables such as spirits, champagne salmon, meat or portable items such as razor blades, cosmetics etc. Burglars typically target cash, cigarettes and spirits, whilst robbers make attacks on the ATMs or cash rooms. Waddington quips, "We plug one hole to stop losses, which has the same effect as putting a finger in the dyke, eventually another hole will appear somewhere else. It is an ongoing situation."
As part of the risk prevention measures, criminal analysis reports are compiled noting incidents throughout the stores. Specific problem areas are highlighted enabling Waddington and colleagues to refine their security measures according to the findings. He explains, "The analysis from the early days up to now shows that the same goods are being targeted, so naturally we protect them." Most stores and PFS have a constant risk of burglary, where cash, cigarettes and spirits are the main targets. This is typical for most supermarkets. Burglars attack dressed in black and wearing balaclavas, which makes them extremely difficult to identify. Even so, CCTV systems can provide valuable evidence that may be used in court. Waddington adds, "Most of the crime is drug fuelled. We stock expensive wines that are never taken, and I am amazed how often burglars will steal branded scotch, rather than malt."
Prior to Waddington's arrival, Sainsbury's used as many as eight contractors working independently, installing different equipment to varying standards. The alarm systems had become complicated to the extent that only a handful of installers were qualified or experienced enough to install or maintain them. In 1998, realising it was time for a change; Waddington researched the market for an alternative alarm system and selected the Galaxy control panel from Honeywell Security. National accounts manager Douglas Gray introduced the Galaxy alarm system to Sainsbury's and quickly arranged training sessions for the operators and store managers. Galaxy was already established as the industry standard. Its range of features and functions were simple to operate, which was an important requirement, and with Waddington's emphasis on keeping things simple, Galaxy has become the preferred choice of alarm panel to be installed throughout the supermarket chain. Waddington adds, "The security alarm system is operated by store managers and staff so it needs to be user friendly and consistent across all stores. It is a valuable tool that store managers can use at any time of the day." Waddington uses the term security alarm system rather than 'intruder alarm', because, he explains: "If the fire doors open - we want to know about it. If the cash office, which could hold anything up to half a million pounds, is under attack - we need to know about it as soon as the incident occurs."
During trading hours, each store's management team takes the necessary action whenever an alarm is activated. Intelligent speakers provide a specific message, to inform staff that there is a security alert without raising any concern to the customers. Most stores will have three keypads, located on the sales floor and in the general office. Waddington adds, "The beauty of Galaxy is that if the manager is in the office, the keypad will tell him where the alert is so he can go directly there." With the Honeywell alarm, a manager can part set the system to protect a particular area, such as the main entrance - outside of trading hours, when the shelves are being re-stacked and the store cleaned.
Response management for all alarms, including the fire doors, panic alarms, cash office and ATMs are managed by SSS Management Services at its communications centre. Waddington comments, "Rarely do we need response, but when we do, we need to manage the response quickly and check for false alarms." As specialists in the retail sector, SSS's main roles are to filter out false alarms from genuine alarm activations and to provide management information on all alarm activations. SSS filters 98% of false alarms at Sainsbury's, which is really valuable. As part of the management information SSS provides detailed reports regarding conditions that cause the false alarms to occur, which could be due to movement, changes in temperature, human error at setting or un-setting the keypad, or a fault with the alarm detector. The company's ethos is to help prevent the situation from recurring in the future. As SSS sales and marketing director Philip George comments, "If we can give our clients just one piece of information that will help them to be more effective in their loss prevention role and have better use of their time, we feel we have provided an important service." If there is a fault, SSS will send an engineer to investigate and repair the system. When confirmed alarm activations occur, SSS notifies the police or the key holder who will then attend.
Sainsbury's takes a responsible approach towards the DD243 standard and police response to alarms. Waddington explains, "The police want the security industry to police itself. I support the principle of DD243, because it seeks to guarantee that when the police are called out there is a genuine alarm and reason for the call. At Sainsbury's we aim to satisfy our own needs through our security arrangements, and hopefully not to waste police time. That said DD243 is not a panacea; if a store loses its police response we will consider installing a DD243 compliant system. However, if there is continued user error, that store can unfortunately lose police response again."
Duncan Freeman is the senior project manager at SSS Management Services, and makes up part of the team responsible for the Sainsbury's account. His career originally started in-house at Sainsbury's in 1991 as a part-time student. He then progressed to manage various departments within the store environment until 1995, at which time he moved across to the retail security team, where he started working with Waddington. Freeman and Waddington have a unique relationship that makes this particular consultant-end-user association so successful. SSS deals with over six and a half thousand sites across the UK, involved in retail, DIY, car maintenance and warehouses. With so many sites and with open book accounting the company has a strong negotiating arm with suppliers, on behalf of its clients. Freeman comments, "Even though we have introduced digital recording mediums into Sainsbury's, we recently managed to shave £5000 off the cost of a CCTV installation. Considering we are doing a hundred or more of these a year with Sainsbury's alone, there is a real cost advantage for the customer and a huge business opportunity for the supplier." Sainsbury's can concentrate on what it does best and let SSS look after the security systems. Waddington agrees, "We are unequivocally getting a better deal using SSS; it has expertise in the market." Essentially this means Sainsbury's does not require a large team to manage the security functions. They have invested in SSS as specialists, and who are, at the end of the day, fully accountable.
As a systems service provider SSS is keen on integration, however Sainsbury's have few sites with integrated systems as Waddington reports there has not been a growing need for it, nor a business case to recommend it. In some stores the alarm systems are integrated with CCTV, so that for example, if a fire door is opened the alarm activates and the CCTV camera automatically pans around to that area to record the scene.
Until recently one escape route for shoplifters would have been through one of the fire doors. Waddington says, "Recent initiatives have put a stop to this. As well as being alarmed, the fire doors are now fitted with maglocks, keeping the doors locked at all times except when there is a genuine fire alarm condition." Safety for customers always remains a priority and the doors will open in an emergency situation. Crime prevention initiatives like these are shared with other retailers.
Waddington and his colleagues are constantly reviewing and introducing new initiatives such as covert track cameras to monitor cash handling at the tills, striving to minimise all problem areas.
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