Warehouses and Distribution Centres: 7 Tips 10 August 2021

How to improve warehouses and distribution centres security

ESG Security’s recommended tips for warehouses and distribution centres security. When discussing crime at warehouses and distribution centres, external theft is often the first thing that comes to mind. It can be more comfortable to think that criminals unrealted to the business are the ones making off with valuable stolen goods – rather than the employees who are an integral part of the business.

_{How common is employee theft?}

Employee theft can be heard to detect and manage, which makes it difficult to know the full impact. With tactics including faking delivery paperwork or recording perfectly good items as damaged, a small percentage of employees can sometimes steal in ways that make it difficult to spot a crime has even taken place.

Despite the true extent not being clearly known, there is data which shows internal theft is a significant cause of shrinkage.

Employee theft in stores accounted for more than 22% of retail shrinkage in 2019, according to a study by the Centre for Retail Research. The same report showed 18% of overall retail shrinkage came from crime targeting suppliers and warehouses.

Both these figures are on the rise – increasing by 1.2% for staff theft and 4.6% for supplier and warehouse crime in 2019. Together they accounted for an estimated £2.22bn of losses throughout the year.

Why do employees steal?

The motivation for theft is not always straightforward, generally there are several factors which cause people to steal from their workplace.

Some common reasons include:

• Financial difficulty – Some staff may take items which can be resold to pay bills, or because an item is unaffordable to them.

• Unhappiness – For some employees, stealing is a way of getting back at a company or boss they feel have wronged them. They may feel overworked, unmotivated, or taken advantage of. Work unhappiness can be costly to businesses in other ways too.

• Lack of supervision – Crime is opportunistic. If there’s an opportunity to steal it’s more likely to happen. In other cases, an employee who would not ordinarily steal does so because they’ve seen another employee do it.

• Belief that it won’t matter – Some employees will try to justify their behaviour with the belief the theft will be covered by insurance, that items won’t be missed or that the company is rich enough to absorb the loss.

Thefts can range from very small, low value items – such as office stationary, which is often taken as revenge – through to high value products which are resold online.

Methods to improve warehouses and distribution centres security

Supervise staff – and make sure they know you’re doing it

If security personnel are on site then they should perform regular patrols. Line Managers can also perform the same role.

Have a no-tolerance approach to stealing

Create a culture that discourages stealing.

Be aware of seasonal risks

Some employers may think temporary staff are less trustworthy than permanent staff, and therefore more likely to steal. If that’s the thinking, it’s important vetting standards are consistent. If you don’t have the time to vet staff, then you might consider outsourcing to get these important checks completed. Supervision is also key.

Have processes in place

In some cases, employees may try to fake paperwork to get stolen items past the supervision team. Sometimes these could be significant thefts, with items loaded into lorries whose drivers is also in on the theft.

There are a range of measures which can help tackle this. At the simpler end of the spectrum, seals are a cheaper solution and can be effective when used alongside a robust process for seal and manifest checks.

Many warehouses and distribution centres now operate blind picks, preventing staff from knowing where an order will be sent and smuggling items out that way. As before randomized spot checks of picks can provide a strong disincentive by increasing the risk involved in the crime, helping to deter opportunistic theft.

At the more advanced end, technology solutions such as RFID tags in boxes can be used to allow whole pallets and lorry loads to be quickly and accurately scanned.

Rotate staff shifts

It’s often challenging for a staff member to carry out a crime entirely undetected by anyone. This can lead to alliances being formed between workers on the same shift – conspiring to either help carry out the theft or keep quiet about what they’ve seen.

Putting staff shifts into a rota system can help to reduce the risk of these partnerships being formed, as staff can’t rely on working with the same people every day.

Keep warehouses and distribution centres organised

Whether it’s paperwork, processes, or items of cargo – unorganised warehouses and distribution centres can make it easy for employees to remove items before anyone’s even noticed. Basic housekeeping measures like keeping stock well organised, storing empty boxes and rubbish in specific areas and having clear – well separated – entry and exit bays makes it more challenging to move items unnoticed.

Clear processes for how incoming and outgoing deliveries, manifests, seals, and paperwork should be dealt with can help to make discrepancies quicker and easier to spot.

Additional measures for enhancing warehouses and distribution centres security

If the above measures are in place and you’re still facing ongoing issues with theft or unexplained losses, consider other options to find the cause of the problem.

Anonymous tip-off lines can be used to encourage staff to report potential crimes, although these can be vulnerable to malicious reports and need to be used carefully. Trained undercover security officers – posing as members of staff – provide another way to monitor activity in a warehouse and uncover the cause of ongoing losses.

Expert support to improve warehouses and distribution centres security

At ESG Security, we’ve worked extensivley within loss prevention across a range of different industries. From an initial analysis of the risks facing your business, through to expert consultancy, technology solutions and professional security personnel services – we can support your business to deliver significant improvements to your loss prevention strategy.