About Dan Menard
Daniel Menard is the Chief Operations Officer of VOTI Detection, an innovator of the 3D X-ray security scanning industry. Headquartered in Montreal, Quebec, Canada, Dan notes that VOTI Detection has been integrated into the air cargo, critical infrastructure, event, justice, loss prevention, maritime, precious metal, transportation and borders security verticals.
In this first post, Mr. Menard discusses some of the security trends, news, and concerns affecting the retail sector. The retail security landscape is changing at a faster rate than ever before. New technologies and rapid movements in the global company prompting are many businesses to rethink operations and how to limit loss.
According to Dan Menard, it’s important to stay up-to-date with the latest developments on loss prevention and how they might affect your business this year. So, here’s a selection of some of the latest industry trends in loss prevention and retail security and why they matter.
AI is The Hottest Loss Prevention Strategy Retailers are Using
Many small and medium-sized retailers have woken up to the advantages that an AI-based loss prevention strategy can bring. Intelligent software has been found to be particularly useful for self-checkouts. AI systems can spot anomalies in the checkout process – which could result from several factors, such as:
- Barcode recognition errors
- Pricing problems weighing issues
- Theft
This technology not only detects these issues but also suggests remedies to solve any problems that delay the purchasing process.
One problem is that many businesses think that AI is too expensive to incorporate into a loss prevention strategy despite that the costs of using AI have fallen massively. As a plus, the range of applications for AI has expanded. It’s now time for all retailers to think about using AI – failing to do this now will mean they end up falling behind the curve.
How Retailers are Tackling Fraud This Festive Season
The holiday season is the most important sales period in the calendar year for retailers. The average American spends $1,000 on gifts and holiday-related items each year. But with increased spending comes increased opportunity for fraud, and retailers need to be extra careful to protect against this.
Since such a high volume of Christmas presents are now bought online, and even more so following the COVID-19 pandemic. Scammers and hackers often intensify their efforts at this time in the hope that their activities stay under the radar. Therefore, the first step retailers should take is to firm up their cyber defenses.
According to a recent survey, only 57% of businesses arranged a data security risk assessment in 2020. Failure to conduct a risk assessment can make a retail business vulnerable to cyberattacks, leading to data breaches and revenue loss.
In addition, it’s important to ensure that retailers use multiple steps of verification when customers complete transactions. Shallow verification processes are easy for attackers to infiltrate, particularly mobile apps that exploit mobile device vulnerabilities.
Finally, it’s important to ensure that software is updated with the latest versions and patches installed to guard against future cyberattacks.
Organized Retail Crime Harms Retailers and Devastates Customers
Daniel Menard notes that Large-scale loss-prevention teams across the US continue to work with nationwide police departments to lower the effects of organized retail crime. Retailers are responding to a rise in organized retail security threats from the pandemic, a result of increased online shopping rather than in-store purchases.
Organized retail crime often involves communications with insiders to steal retailers’ stock covertly. The products are then obtained illegally and sold through an unlawful commercial business. However, scammers can also produce counterfeit products wrapped up in genuine packaging or sell fake goods for a large mark-up, convincing consumers that the product is worth the extra cost.
Every day consumers might be conned into buying broken, missing, or counterfeit goods. They’ll pay for a product which either doesn’t work or doesn’t meet appropriate manufacturing standards, posing serious risks to their health and safety. Organized retail criminals often work together in large groups and have the resource to pull off complex criminal tactics which evade the attention of businesses. Retailers must work with law enforcement to protect against organized retail crime. Many have even embarked on educative programs for staff and customers to help spot and protect against retail criminals.
The Banana Scheme and How Analytics Can Stop It
People love buying bananas. But more bananas are sold by retailers than the amount they stock. How can this be?
It turns out, people don’t love bananas as much as they say they do. Instead, they are entering a code for bananas at the self-checkout to masquerade for more expensive goods in their trolley – the so-called ‘banana scheme.’
The issue has become so serious that it’s developed into a key area of focus for retail loss prevention – and two key preventative measures have been established to mitigate against this tide using analytics software.
First, analytics can determine if there are some customers buying inordinate quantities of bananas. If someone is buying more than ten bananas in a day or making trips to buy bananas multiple times a week, this raises a red flag, and these customers are investigated.
Second, if multiple orders of bananas take place during the same shopping trip, this should also be flagged up. People tend to weigh all fruit and vegetables of the same type together, so failing to do this suggests they’re being used as a proxy for something more expensive.
Bottom Line
Unfortunately, retailer loss and security breaches are not issues that are decreasing. Following the COVID-19 pandemic and increased online consumer activity, retailers and customers are becoming more vulnerable to potential data breaches and financial loss on stolen products.
However, every business can increase their loss prevention strategies, avoid shopping scams, block data breach attempts, and protect their revenue. Follow Dan Menard and VOTI Detection for frequent updates to the blog.