Some retail technologies also assist loss prevention efforts as a helpful side effect.
Losses from retail shrink are on the rise, as revealed in the new 2022 National Retail Security Surveyreleased by the National Retail Federation. While any retailer’s loss prevention strategy should include dedicated shrink detection and prevention technology, other solutions used in different areas of the enterprise can also provide anti-shrink benefits.
True frictionless shopping, where customers digitally announce their presence in a store, take the items they want, and then leave with automatic debit or credit payment for their purchase, is growing in popularity in the grocery and convenience verticals. One of the best-known examples is Amazon’s “Just Walk Out” technology, which is designed to offer customers a quick shopping experience to pick up grab-and-go food, snacks and beverage items, and a few everyday essentials.
Just Walk Out leverages a combination of computer vision, sensor fusion and deep learning that enables shoppers to shop the store, pick out what they want and skip the checkout when they’re done. When shoppers arrive, they open the Amazon app, tap “In-Store Code,” and scan in with the QR code presented.
The frictionless retail model relies on sophisticated, artificial intelligence (AI)-based cameras and shelf sensors to track every item each individual customer picks up and puts back, in real time. While frictionless shopping does not eliminate shoplifting, its very nature makes detecting theft before an offender can leave the store much easier.
Note that the true frictionless model, which eliminates checkout altogether, serves as the best shrink reducer. Wegmans is ending its app-based self-checkout program, which involves stopping at a self-checkout register and applying payment before leaving, due to high loss rates. Self-checkout solutions typically do not feature quite as much intensive, real-time product and shopper tracking, opening more possibility for abuse by shoplifters.
Automated shelf tracking
Technology that applies AI and machine learning (ML) to detect low or empty stock levels can also serve as a real-time loss prevention system. For example, Walmart Canada is rolling out a computer vision AI solution from Focal Systems that uses cameras to automate out-of-stock detection.
The solution, which is integrated with the retailer’s existing inventory systems, automatically detects real-time availability concerns, such as out-of-stock or low-stock products on shelves, and directs store associates to replenish them.
This type of system generates historical data that can be analyzed for inventory patterns that suggest nefarious activity. It can also send real-time alerts to store managers or company loss prevention experts who can pick up on shrinkage signals that associates might miss.
Robotic solutions, such as the multipurpose Badger Technologies autonomous robots regional home improvement retailer Busy Beaver Building Centers uses to more closely monitor in-store inventory, traffic and buying trends, can also serve this dual shrink reduction purpose.
Enterprise order management
Solutions that provide retailers real-time visibility into the position of stock, across every channel and touchpoint in their enterprise, can also provide crucial insight into shrink issues that may exist throughout the supply chain. Mulberry, a U.K.-based designer and manufacturer of luxury leather goods, is rolling outthe Aptos order management solution.
Mulberry is implementing the Aptos system across its stores and e-commerce operation as it continues to expand operations internationally. The company recognized the need to establish a unified view of inventory, so it would know whether stock was positioned in stores, distribution centers, or elsewhere in its demand chain.
By obtaining a unified, omnichannel view of stock location, Mulberry increases its ability to meet customer expectations for a seamless experience across all channels, as well as for faster delivery and heightened convenience. In addition, Mulberry gains immediate insight into any unusual movements or disappearances of stock, when and where it occurs.