Preventing Theft in Retail Businesses—Part II

Last week we looked at shoplifting and offered ways to curtail shrinkage from outside individuals. This week we focus on the bigger piece of the retail shrinkage pie—employee theft. According to the U.S. Dept. of Commerce, 36% of retail fraud is conducted by outside shoplifters, while 43% of theft is an inside (employee) job.

Tip: Conduct regular check-ins with staff. Being heard will keep many employees from following through on thoughts of theft.

2 yearshow long office theft continues before it is detected 


How BIG is this problem? The FBI considers employee theft “the fastest growing crime in America.” And, according to the Theft Barometer, key reasons for internal theft include poor pre-hire screening, a decrease in supervision of staff on the floor, and the ease with which stolen merchandise can be sold.

How BAD is the problem? Here are a couple of stats to show how serious the situation is in the U.S.

  • 37% of thefts are committed by managers, reports Small Business Resources.
  • 2 years…how long office theft continues before it is detected.



Here’s a look at some of the key problems, along with suggestions for addressing and correcting them.


Over the last several years, a major reason for rising employee theft is an increased sense of entitlement. That is, the “I deserve this” mindset.


Conduct regular check-ins with staff, asking them how they’re doing and how they like their job. Being heard will keep many employees from following through on thoughts of theft.

PROBLEM…PT/Temporary Hires

Internal theft becomes more rampant during peak times, as even optical companies often bring in temporary or PT workers who are frequently paid less than full-time staff. That encourages the “I’m just here for now” mentality.


Screen all prospective personnel, including part-time or seasonal staff. Most important, check their references. And, during the interview process, be sure to ask the prospective worker why they left previous positions. Those responses can be very telling.

PROBLEM…Theft of Time

The employee spends time on company equipment for personal use, like Facebook, or takes long breaks. The FBI calls this the theft of time, and it costs U.S. businesses $500 billion annually.


Pay attention! Managers need to monitor new hires…and you need to monitor the managers. Some practices have a no-phone policy, except during lunch or breaks. That definitely cuts down on time away from the job.

PROBLEM…Padding Orders

Have you considered that an employee may be adding on to your orders for frames or sunwear?


Keep a tight rein on who does your ordering, especially if they are ordering for multiple locations. Always check invoices and match them to what is actually on the floor.


What if your layout isn’t conducive to monitoring employees?


If you have security cameras, adjust them so there are no blind spots. Make sure exits are visible and well lit and that employees are leaving from an exit you or someone else in management can see. Some businesses have employees sign in and out. That can make departure with lifted goods more uncomfortable.

So, what steps have you taken in your practice to prevent employee theft? Have you noticed a difference since introducing them? Tell us about it and share in the conversation on Facebook here.

Erinn Morgan