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Preventing Warehouse Theft and Saving Your Business from Failing

Do you know that the United States, for example, loses about $30 billion a year to cargo theft? Why is it so easy to steal from a warehouse? For one, there are a lot of products that it’s simply hard to check manually. The reliance on technology has its drawbacks because we base our data on what the computer screen says. Sure, your data say that you have 1,000 boxes of an item, but how can you be sure that no one has taken a box or two out of the warehouse?

The truth is that internal theft is more common than external theft in the warehouse. Your staff can collude with criminals to move inventory around without the warehouse manager noticing. And yes, even the warehouse manager can be in it, too. The temptation of warehouse theft is real because employees are mostly left unsupervised. Admit it; most warehouses are disorganized anyway. If a box or two are missing, it’s hard to blame anyone if there is no good inventory system to begin with.

Do Cycle Counting

Sure, a warehouse management system (WMS) is a good idea, but it wouldn’t be as accurate as manual counting. But because employees cannot count everything manually, it’s important to do cycle counting. This is when employees count small subsets of inventory in various locations in the warehouse. By performing this method, you would’ve counted all the goods over time. Make sure that the manual inventory matches the digital inventory records.

Secure the Warehouse

It is unfair to blame employees for warehouse theft when you do not have proof. Find out how to install a CCTV camera so that you have eyes on every nook and cranny of the warehouse. Make sure there’s dedicated security to watch the screens. You will use whatever the cameras capture to determine why an inventory is lacking. You should have round-the-clock security, so make sure your business is up for that.

Conduct Background Checks on Employees

It is a no-brainer to check the criminal backgrounds of your potential high, but you will be surprised to know that so many employers don’t do this. Instead, they trust what little documents are given to them. What you can do is simply made a call to the potential employees’ past employers. Ask them about how long they worked for them and why did they leave. Most employers will warn you against hiring someone who has a criminal record with them. At the end of the day, if your gut tells you there’s something off about a person, trust your gut. It has taken you far in the business not to trust it.

Limit Access to Inventory

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Make sure only your most trusted employees will access the inventory data. Stocks can be manipulated in their absence, so do not allow anyone to change or edit the data. It will be easier to detect who is at fault if only a handful of people manage your inventory. If you have to allow more than two to three persons to see the inventory, give them unique usernames and passcodes so that the system can take note of who accessed the data while you’re away.

Rotate Shifts Regularly

Theft happens because the employees are familiar with the routine and system. They develop alliances the more they spend time together. Rotating their shifts will prevent this. Ensure that they don’t spend too much time on one area of the warehouse because they will perfect the system. At the same time, mix and match the teams so that they don’t develop plans to steal or do any other criminal activity.

Raise Policy Awareness

Let your employees know what will happen if you caught them stealing from the inventory. If you are strict about your policies, then they will take you seriously, too. You must have zero tolerance for stealing and inventory data manipulation. If you let employees off the hook once, who will say that they won’t try it again?

Compensate Them Well

Not that it’s your fault that they are tempted to steal. That is their decision. However, compensating them enough and earning their trust and loyalty will make them protective of your organization. They will be more circumspect of any decision that will put their employment in jeopardy. Besides, if they believe that they are in a good place, they won’t attempt to break your trust.

Yes, it is hard to prevent warehouse theft because its environment makes thievery and burglary pretty easy. But you’d have more control of your warehouse inventory and employees with the right policies and tools. Make sure that you’re focused not only on your physical store but also on the place where the inventory comes from.

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