Business loss prevention refers to well-structured efforts to minimize or prevent revenue losses. Typically, losses happen due to operational or managerial issues such as inventory controls, accounting, theft of employees, supplier fraud, or security. Fortunately, you can increase your business success chances by reducing or preventing these issues. The following are some of the tips you can apply.
Leverage your Workers and Encourage Buy-in
Encouraging workers to support a new loss prevention strategy is normally more effective than introducing punishment to force them to comply or offering reward programs. Employees should view the initiative as a good plan and support it. When workers focus on business success, they usually put more effort into protecting it against losses. Furthermore, it is crucial to explain to the employees that you intend to improve their working environment, which entails creating a loss prevention plan.
Develop Clear Policies
If you want to prevent your company from losses, you should consistently and regularly enforce your loss prevention needs. Besides, when you inconsistently adopt loss prevention strategies, your employees may lose their buy-in. Therefore, it is crucial to have a well-documented policy. Furthermore, every stakeholder in your business should understand that their moral obligation is to help prevent any form of loss. Notably, Cane Bay Partners CEO suggests that a business policy should indicate the necessary mechanisms for responding to and preventing losses.
Adopt Clear Training and Communication
It would help if you considered adding loss prevention as part of orienting your new workers. This entails explaining to them that your company cares about its workers and you want them to work in a secure place. It is important to train your employees to prevent theft from within the company, since it can negatively affect them or the business. Besides, managers should respond to any accounting mistakes immediately. After orientation, you should also ensure that the employees adhere to the company’s loss prevention policies. This often entails communication and follow-ups.
Loss prevention entails more than handling theft. In some instances, losses may be noticed on books of account. Therefore, it is important to know whether you need to adopt new accounting practices. Some companies only focus on cost accounting, whereby they track inventory according to their payments. However, although adopting retail accounting entails more work, it usually detects more administrative mistakes.
Systematize Inventory Controls
Since applying automation helps offset the extra effort needed to implement better loss prevention strategies, you should identify the automation measures. For instance, you can apply intelligent asset lockers, which prevent expensive equipment owned by a business. Automating inventory controls prevents honest mistakes and internal theft. Suppose a user claims that they returned a laptop to an empty compartment; you can use the content surveillance systems placed in lockers to verify their claim.
Apply Strong Restraints
Creating the perception of a solid security system is crucial, just like possessing strong security. This entails having dedicated employees to prevent shrinkage or shoplifting individually at every location and installing surveillance cameras, visible anti-theft tags, and motion sensors. Moreover, taking simple steps such as placing warning signs indicating that the building is under 24-hour surveillance can scare away thieves.
Follow-Up Loss Trends
Since some losses such as accounting errors are usually apparent over time, minor inventory losses may accumulate. Therefore, it is crucial to gather a steady data stream of those accounts and inventories as you focus on emerging trends. This involves analyzing data patterns and unexpected losses by frequently undertaking scheduled audits. Besides, it is also advisable to undertake random audits after a certain period.
Every entrepreneur aims at succeeding in their businesses or investments. Therefore, it is crucial to develop a loss prevention strategy and policies.