The latest crime figures from the BRC, British Retail Consortium, can only have added to the gloom in the retail sector, along with the news on HMV, Jessops and Comet. The cost of crime rose significantly again last year, according to the BRC Retail Crime Survey 2012, rising by 15.6 per cent, to an overall cost of £1.6 billion – with spend on crime and loss prevention climbing by 7.1 per cent, to a median expenditure of £750,000 for each of the major retail organisations surveyed.
Systematic targeting of higher value retail goods by organised criminals has pushed up the cost of crime. This has required an increasingly targeted approach to security, to protect the most vulnerable products, such as, alcohol, meat, cheese and coffee in the case of supermarkets.
With retail margins under unrelenting pressure, leading discount chains and other major retailers are changing their security strategy. From simply providing a safe environment for staff and customers, the priority is increasingly a focus on loss protection and maximising the ROI (Return on Investment) from security.
In the corporate sector, too, property directors and facility managers of financial and other city-based services companies are starting to look for a similar level of performance and accountability from their security provision.
The new strategy is differentiated by its ‘holistic’ approach to securing people and assets. Security is recognised as an integral part of the business process: in the case of retail sector, it runs through the supply chain, to the arrival of goods in-store and to the point of sale. It encompasses staff, customers and suppliers alike, in addition to products, buildings and on-site facilities…
A key component of the approach is the blend of a range of security services needed to reduce both losses to theft and the cost of protection. The mix comprises guarding, investigations, CCTV technology and civil recovery proceedings; in the latter case to use civil law remedies as an extra deterrent and also help meet internal costs of investigation, apprehension and disruption to the business.
A high level of management information is required to measure performance in the operation of a programme of this range and complexity. This is provided by regular reporting on agreed financial and incident KPIs (Key Performance Indicators) with data that is monitored and analysed at a central hub, collected from branch locations and civil recovery proceedings.
Wilkinson Hardware Stores
With £1.5 billion retail sales annually, Wilkinson Hardware Stores Ltd in 2012 commissioned the first stage in a remote monitoring and ‘intelligence’ network operated by Lodge Service. The programme is set to reduce the cost of store security by an estimated 50 per cent, and increase return on investment in deterrence, detection and civil recovery by up to 40 per cent. Intelligence gathered in the network hub in Accrington, Lancashire, is provided by remote surveillance of in-store CCTV, together with information from security guarding, investigations, staff screening and other personnel services.
Mick Phipps, head of loss prevention at Wilkinson, says, “The network has been designed to provide much more than traditional CCTV monitoring. The software platform allows us to connect all areas of our business nationally in a comprehensive loss prevention strategy. From distribution centre to the retail selling space, we are able to use technology to deliver a clear return on investment, whilst ensuring the safety of our staff and customers and the protection of assets.”
For lone-worker, driver-controlled deliveries out of hours, staff at the Accrington hub can track each delivery vehicle throughout the journey from the warehouse. The arrival of goods at the store is monitored on live CCTV; internal alarms in access areas and loading bays are switched off remotely and spaces illuminated, whilst a ‘man down’ device offers additional worker protection during unloading. The process is reversed and the area locked down securely when the delivery is completed.
“The new infrastructure can provide warning and aversion of threats through the provision of real time data to managers gathered centrally. So overnight or each morning we can deploy security staff and deal with any issues for that day. The database of shared information enables a fast, targeted and proportionate response to ensure the protection of people and product,” asserts Mick Phipps.
Serviced Office Group
In the corporate sector, Serviced Office Group has estimated savings in the cost of protecting property and assets at 28 per cent from its new strategy. This follows a strategic review in 2012 of its security operating model across its estate by the AIM-listed provider of office space and IT facilities, which operates 23 business centres.
Operating primarily in London and the South East, properties include the newly refurbished 33,000 sq. ft. Mermaid House office block at Blackfriars, London EC4, adjoining the Mermaid Theatre and conference centre.
All sites are monitored remotely at Accrington by Lodge Service. The network’s software and hardware platform enables monitoring of almost any client on-site system or service, including HVAC (Heating, Ventilation, Air Conditioning) and fire alarms, with alerts to a smartphone, tablet or other selected device, and performance matched to agreed KPIs.
Says Anne Stokes of Serviced Office Group, “By continually benchmarking our service providers we can ensure that Serviced Office Group and its clients receive the maximum benefit from both innovation and value for money. The initial assessment and periodic re-examination of partners ensures the solutions provided by us are always best in class and robust.”
Guarding represents one of the largest cost elements in the security budget, so the substitution of CCTV and remote monitoring for out-of-hours protection offers major savings. The capital investment in technology can usually be written down for depreciation purposes.
There are further opportunities to defray the costs of guarding by ‘adding value’, improving business efficiency and services for building occupants. This can include deploying guards for ‘front of house’ concierge services in reception areas. For one UK bank, the service delivered savings of £130,000 annually.
Guards complete a number of duties outside normal office hours, armed with an activity checklist: from setting up meeting rooms each morning and loading photo-copiers, to checking that fire extinguishers and other appliances are within the expiry date, and reporting on damage to the building or facilities.
The guard’s role can also include dealing with secure waste, ensuring it is properly managed at collection points, and taken out of the building and delivered to the waiting waste contractor. This reduces the number of suppliers entering the building. Access control generally is a particular area of vulnerability in offices.
A further opportunity is in the area of business continuity planning. When a building has to be evacuated following a major security alert for example, security integrity can be maintained by remote monitoring and access control from a hub, with entry and exit controlled through the use of CCTV and a voice link, in a similar process to the management of overnight deliveries to Wilkinson’s stores.
This is just one of the areas where corporates can benefit from the new holistic strategy used by retailers to boost loss protection and ROI from security.
ROI Strategy Checklist
- Understand the risks: assess the risk profile of the key stages of your business processes. Consider lessons from similar sites and organisations, including the potential targets and threats.
- Match your security process to the risks: protect points of vulnerability appropriately and proportionately. Combine security systems and personnel, including remote CCTV monitoring out-of-hours.
- Audit compliance regularly: check that staff comply with your processes consistently. Employment background checks, test purchasing, physical surveillance and investigations are invaluable.
- Outsource services to a monitoring centre: a higher Return on Investment from security and building services may be achieved by linking CCTV, fire alarms and other web-enabled services to a central hub, staffed 24-7.
- Add value wherever possible: guards could be trained in a series of facility management tasks. ‘Environmental guarding’ of the building fabric and facilities adds ROI from security.
- Set Key Performance Indicators: objective measures of cost and the return from security systems and services should be quantified. KPIs support planning, reporting and day-to-day deployment – and help build board-level support for security.