Inventory Theft: Taking The Bull By The Horns

Inventory Theft cover
The size of the Indian warehousing industry is approx. INR 560 billion and is growing at more than 10% annually.Warehousing forms a crucial link in the overall logistics value chain. It accounts for 5% of the Indian logistics market.Growth Drivers:

  1. Growing manufacturing activity
  2. Rising domestic consumption
  3. Increasing international trade
  4. Emergence of organised retail in the country
  5. Increasing private and foreign investments in infrastructure
  6. Easing of government regulations
  7. Goods and Services Tax (GST) and Make in India set to give a thrust from the Manufacturing sector for Warehouse spaces

The industry has grown dramatically in the past few years and unfortunately inventory loss has also kept up a brisk pace. Many companies believe that theft is an unavoidable cost of doing business. A billion dollar Black Market is thriving, thanks to the Inventory Theft. This is undoubtedly the ‘Number One’ problem faced by any company that owns warehouses.

One of the key reasons of pilferages is that organisations have relied mostly on ineffective manual security guards that gets comprised within months of their employment.

The Challenges

Installing CCTVs Definitely Do Not Stop Intentional Theft!

Most organisations spend a tidy sum on installing state-of-the-art cameras with high-end features that become a piece of decoration within a few months. A regular and habitual thieving employee can easily tamper with it.

This tampering is not detected till a huge Pilferage occurs and in the end, you find that the videos of a particular time and date are unavailable.

Guards Cannot Stop Serious Theft!

Guards change from time to time. Training provided to them for detecting theft is inadequate. Guards can only be in one place at a time. Guards are human and have often been easily compromised by intentional collaboration or by befriending. Every single Loss Prevention Head is aware of this and still a large number of Guards are employed round the clock.

Alarm Systems Do Not Prevent Pilferage!

Alarm Systems are designed to protect distribution centres from breaking and entry and not internal theft. When a facility is in operation, the Alarm Systems are deactivated, thereby making them unable to prevent Pilferages. Also, the Alarm Systems are turned off when any dishonesty takes place.

The Result

A Double Whammy effect on the bottom line!

Firstly, a considerable increase in guarding costs and Secondly, high recurrent losses due to Pilferages.

Prevent Pilferage Before It Happens

Prevention is the key. Loss prevention measures must be put in place. The basic rule of Loss Prevention is implementing a proactive approach rather than ‘After The Fact’ forensic investigation.

LIVE E-Surveillance is known to be the most effective means to not only detect, but also deter Pilferages.

With LIVE E-Surveillance and 2-Way Audio, all your cameras will be watched remotely 24/7.

Any tampering or misdoing will be detected immediately and actions will be taken promptly. The huge benefit of savings from reduced Pilferages, coupled with the considerable amount of savings, by reducing your inefficient guard force will be more than enough pay for a LIVE E-Surveillance solution.

The employees would be fully aware that they are being watched remotely. The LIVE Monitoring along with 2-Way audio warnings for suspicious conditions from the Command Centre will reinforce the fact that they are being ACTIVELY WATCHED.

Warehouses by their very nature are located in remote areas and are ever prone to burglary. Securens 5th Generation E-Surveillance solution with Active Deterrence monitors your premises day and night. It not only detects any intrusion, but also attempts to prevent it immediately.

* Source:  EY Analysis, Crisil Report on Warehousing