Inside Home Depot’s efforts to stop a growing theft problem at its stores

Theft pressures profits

During the first three quarters of 2019, Home Depot reported that an increase in “shrink” hurt its financial results. “There’s been pressure to our margin from shrink, which was the highest contributor to the decrease year over year,” Home Depot CFO Richard McPhail said in the third-quarter earnings call Tuesday.

Scott Glenn, Home Depot vice president of asset protection, said he has seen a correlation between higher rates of organized retail crime and areas of the country where the dollar amount for felony thresholds have been raised. The felony threshold is the dollar value of goods stolen that determines if charges are a felony or a misdemeanor. It varies widely by state - from $200 in New Jersey to $2,500 in Texas.

Glenn said the opioid epidemic fuels organized retail crime in many cases, and e-commerce amplifies its reach.
With the rise of e-commerce, it is easier to sell items quickly online than in person at pawnshops or other methods.

Going after organized retail crime

Home Depot may not stop the theft as it happens, but it’s not ignoring the problem.

“We know that we’re not going to get everybody. But if we can get those folks that are really hurting us, we can actually drive our shrink numbers down and make the store safer,” Glenn said.

The retailer is building case files that not only help law enforcement go after suspects, but help change laws. Utah is one state where Home Depot, eBay and law enforcement have been working together to identify and prosecute organized retail crime rings. In Salt Lake City, the retailer worked with the state’s attorney general’s office over several years to close down a $1.5 million fraud case that involved seven pawnshops and a crime ring that was stealing and reselling the stolen goods.

The retailer has instituted a number of deterrent tactics to make it harder for criminals to steal, including the addition of more visible camera surveillance and alarmed spider wraps on certain high-value products. At the same time, however, it works to ensure the anti-theft strategy doesn’t impede the shopping experience for paying customers.

Organized retail crime is a higher priority on Home Depot’s list than in the past — not just because it hurts the bottom line but also because it hurts the community, Glenn said. cnbc.com
 

McDonald's employees in Chicago sue over workplace violence

- Suit claims new lowered counters in redesigned stores make it easier
  for angry people to jump over and attack employees
- McDonald’s "ignores best practices that could make stores safer"

McDonald’s Corp (MCD.N) employees on Thursday sued the fast food giant and several of its franchisees in Chicago over a store redesign that staffers say has made it easier for angry customers to leap over the counter and attack them.

The suit, filed in Illinois’ Circuit Court of Cook County by 17 Chicago-area McDonald’s workers, claims McDonald’s has failed to protect them from a pattern of violence. Employees have been threatened with guns, beaten with a wet-floor sign, had kitchen equipment thrown at them by a naked customer, been pepper-sprayed, been flashed and propositioned, and even urinated on, according to the complaint.

“McDonald’s takes seriously its responsibility to provide and foster a safe working environment for our employees, and along with our franchisees, continue to make investments in training programs that uphold safe environments for customers and crew members,” the company said in a statement that did not mention whether it planned to contest the lawsuit. “In addition to training, McDonald’s maintains stringent policies against violence in our restaurants.”

The lawsuit targets McDonald’s so-called “Experience of the Future” store renovations announced in 2017, a $6-billion plan to revamp most of its roughly 14,000 U.S. stores. The suit claims that the new design features split and lowered counters, creating easy access for customers seeking to harm employees on the other side.

Filed in conjunction with the Fight for $15 and a Union, the complaint alleges a nationwide epidemic of in-store violence, including an armed robbery at a McDonald’s in Orlando, Florida when workers were held at gunpoint in a walk-in freezer. In the Chicago area, there are more than 20 calls every day to emergency services from McDonald’s stores, the suit said.

Plaintiffs claim that McDonald’s ignores best practices that could make stores safer, especially at locations open overnight. Those measures include drive-thru windows that block customers from entering the store, windows free of advertising materials that otherwise obstruct lines of vision and bathrooms that lock when workers need to clean them alone late at night. reuters.com
 

In Response to Mass Shootings,
Increased Security Personnel Isn’t Always the Answer

More security officers won’t necessarily save lives if a mass shooting occurs.
It takes effective communication to mount an effective response.

As of September 2019, the U.S. had seen 283 mass shootings since the start of the year. Even chaotic false alarms are becoming more common. In order to placate and protect citizens, security teams must take immediate measures. And in times of heightened public fear, the natural response is of course to add more personnel and more resources.

But while additional personnel can go a long way in producing a more visible presence and easing some citizen anxiety, security teams should consider whether this is the best investment for public safety. The real questions we face are not necessarily around how many officers are present, but how relevant personnel will communicate in order to take effective action. When the worst happens, how will key information be delivered to enable efficient response rather than panic and chaos?

In periods of crisis, communication is already prone to breaking down. A unified collaboration workspace can go a long way in terms of integrating key information and delivering actionable alerts. To neutralize active shooters and prevent harm to the public, it’s time to focus not on more security, but better security — by providing a digital collaboration tool equipped for persistent communication and real-time data visibility in high-pressure scenarios. securitymagazine.com

Retailers called to increase security at stores due to recent shootings
El Paso considering ordinance that would require retailers to implement certain security measures. securityinfowatch.com
 

Amazon Go Supermarkets, Pop-Up Stores Coming In 2020
Amazon is planning to open cashierless Amazon Go supermarkets and pop-up stores, possibly as soon as the first quarter of 2020, Bloomberg reported Wednesday (Nov. 20).

The latest hardware revisions have improved cameras and software and fewer backroom servers, which has reduced the overhead of setting up a new store, the source said.

The Amazon Go concept was originally launched with big supermarkets in mind but was dropped in favor of smaller convenience stores featuring grab-and-go staples. Now the technology is planned to accommodate 30,000-square-foot stores. Some $1 billion in salaries have gone to people working on the project, the source said.

The Go team is now part of Physical Retail Technologies, a new entity that worked for the past two years on improving the efficiency and profitability of the tech so other retailers would want in, the source told Bloomberg.

The pop-up kiosks are planned as miniature versions of the current Amazon Go stores and could be part of malls and sports stadiums, the source told Bloomberg.

“The big question isn’t will the tech work — Amazon will make it work,” said Forrester Research’s Brendan Witcher. pymnts.com

Ahold has a go at cashierless store format
Ahold Delhaize USA, which operates supermarket banners including Food Lion, Giant, and Stop & Shop, is piloting a new frictionless store environment. Called “Lunchbox” and developed by the company’s Retail Business Services subsidiary, the format enables customers to scan in, shop, and walk out without having to stop at any type of checkout terminal.

Currently being tested at Retail Business Services’ office in Quincy, Mass., Lunchbox is powered by a Retail Business Services proprietary app that admits shoppers to the store and charges them for purchases. Payment services such as PayPal, Venmo, Apple Pay, and Google Pay are integrated into the app’s wallet.

Inside the store, artificial intelligence (AI) technology running on Intel Core i5 and i7 processors-based systems optimized with the Intel Distribution of OpenVINO computer vision toolkit detects which products are being removed from shelves in the store, and anonymous body skeletal tracking connects the right products to the right shopper.

“Lunchbox is an easy, fresh shopping alternative,” said Paul Scorza, executive VP, IT and CIO for Retail Business Services. “Once registered, shoppers simply scan in, shop and walk out. It’s that easy. And it offers fresh, healthy options 24/7. You can grab a snack, a salad, fresh fruit or even a carton of milk on your way home.” chainstoreage.com

1,700 New Stores & 850 More Coming
Today, there are over 1,700 stores operated by digitally native brands
Like ThirdLove, Warby Parker, Allbirds and Away. Digital brands are expected to open another 850 stores by 2023, according to JLL Research, led by companies like Casper, Untuckit and Adore Me.

#1 = The online retailer that has been most aggressive in expanding its brick-and-mortar presence is SmileDirectClub, which has opened over 300 locations since 2016. Most of them are inside of CVS and Walgreens stores. It has the option to open more than 1,000 additional locations at these retailers. Special Note: They staffed a senior LP executive this past year.

#2 thru #10 = The next most brick-and-mortared digital brands: Tesla (128 stores), Suitsupply (125 stores), Warby Parker (116 stores), Alex and Ani (104 stores), Kendra Scott (95 stores), Peloton (83 stores), Untuckit (83 stores), Bonobos (61 stores) and Indochino (56 stores).

“People are tracking store closures so closely, but not store openings,” Amazon's 4-star not included - opened before 2000. forbes.com

Interesting Common trait: One thing he found was that online brands like to be near each other and have flocked to the same malls and downtown streets. “More often than not, young brands are interested in clustering next to each other.”

The RealReal’s ‘Faux and Tell’ reports disclose fake items
published on the site and returned
The RealReal is an online luxury consignment store that used to differentiate itself by saying everything is 100% real. The CEO has said there are “no fakes on our site” and “every single item [is] authenticated.” In the wake of a CNBC investigation on its authentication process, the CEO said, “we may not be perfect every single time.”

Newly obtained internal documents, called “Copywriting Faux and Tell,” a weekly recap of TRR published and returned counterfeits, show hundreds of fakes the company missed. A total of 227 pages from the first and third quarters of 2019 show specific examples of what are labeled “TRR fakes.”

The reports offer a sampling of the types of counterfeit products that slipped through the company’s vetting process. These include mistakes that may appear to be obvious. For example, an employee missed Jimmy Choo flats that misspell the company’s name on the sole. It reads “Jimmy Ghoo.” cnbc.com

Whopper of a mistake:
Discount gaffe costs Burger King's top franchisee more than $12M
Syracuse-based Carrols Restaurant Group, the largest Burger King franchisee in the nation, says it mistakenly gave a double discount on Whopper meals at its more than 1,000 restaurants during parts of the second and third quarters of this year. The mistake caused a reduction in revenue of about $12.4 million in the first nine months of the year, increasing the company’s net loss by $8.2 million during the period, the company said. It reported this week losing $22 million on sales of $1.06 billion during the period. syracuse.com

Allied Universal and SOS Security Announce Industry Transformational Merger
Allied Universal®, a leading security and facility services company in North America, and SOS Security®, a renowned provider of global security services, announced Thursday that a definitive agreement has been executed with respect to a transformational merger that creates a security leader in North America and beyond. aus.com
 

Senior LP & AP Jobs Market

Reposted - Mobilelink/Cricket Wireless - Dir. of Asset Protection, Sugar Land, TX
Functional Group - Corporate Operations. Base salary $108K/yr Range: $69k - $169K / Total Compensation $121K/yr Range: $73k - $201K

Mobilelink was originally founded in Houston Texas with 3 locations. Currently Mobilelink operates nationwide with over 550 locations and currently the largest authorized retailer for Cricket wireless. recruiting.adp.com

Senior LP Job Postings Removed from Website:

• Director of Security - Liberty Compassion - Clinton, MA
• Dir. Loss Prevention - Petco - San Diego, CA
• Sr. Security Project Manager - Verizon - Waltham, MA
• Compliance Investigations Manager - Walgreens Boots Alliance - Deerfield, IL