 |
| Dealing with Employee Theft |
Dealing with Employee Theft
Suppose that you own a small retail store with a dozen employees. Your sales have remained steady, but your profits have dropped and you suspect that the cause may be employee theft. What can you do to deal with this problem?
First you should remind yourself that reliable and efficient employees are a business’s greatest asset. You want to take all reasonable steps to encourage and reward your good employees. Any action taken against an employee needs be judicious and planned to cause minimum disruption to your business.
Second, you should conduct some background research and reassess the general situation. ‘Shrinkage’, as it is often called, is a common problem in any business.
Somehow, the revenues at the end of the week are less than they should be. There are a number of potential causes, including:
1. Poor inventory control – sometimes you do not receive all the inventory that you have paid for, some inventory may be damaged and has to be written off, some sold items are returned, some items are discounted, or some items are given away for advertising.
2. Poor accounting – through poor bookkeeping you may not really know how much inventory was sold at what prices, you may not know the true total of your expenses, or you may not know how much you owe others, or others owe you.
3. Theft – items may be stolen by shoppers, by employees, or by third parties after your business is closed for the day. Theft may be described as pilfering – a little here, a little there – or theft may be described as a money-making operation for a professional thief.
Prevention is a major component in controlling shrinkage. You may need to update and develop better procedures for inventory control and accounting. You may need to do a better job of selecting employees in the first place.
You may need to hire a security expert to review your procedures for dealing with customers, handling cash, and securing inventory. You may need to organize a professional development program for your employees outlining any new procedures and emphasizing the benefits of being part of a prosperous business.
If an employee is caught with incriminating evidence, you may call the police and press charges, you may fire the employee, or if the offence was minor you might be able to work out an ad hoc rehabilitation program. In all such cases it is essential to carefully document your evidence and your actions. In general, problems involving people need to be dealt with carefully and according to established procedures.
Suppose that you own a small retail store with a dozen employees. Your sales have remained steady, but your profits have dropped and you suspect that the cause may be employee theft. What can you do to deal with this problem?
First you should remind yourself that reliable and efficient employees are a business’s greatest asset. You want to take all reasonable steps to encourage and reward your good employees. Any action taken against an employee needs be judicious and planned to cause minimum disruption to your business.
Second, you should conduct some background research and reassess the general situation. ‘Shrinkage’, as it is often called, is a common problem in any business.
Somehow, the revenues at the end of the week are less than they should be. There are a number of potential causes, including:
1. Poor inventory control – sometimes you do not receive all the inventory that you have paid for, some inventory may be damaged and has to be written off, some sold items are returned, some items are discounted, or some items are given away for advertising.
2. Poor accounting – through poor bookkeeping you may not really know how much inventory was sold at what prices, you may not know the true total of your expenses, or you may not know how much you owe others, or others owe you.
3. Theft – items may be stolen by shoppers, by employees, or by third parties after your business is closed for the day. Theft may be described as pilfering – a little here, a little there – or theft may be described as a money-making operation for a professional thief.
Prevention is a major component in controlling shrinkage. You may need to update and develop better procedures for inventory control and accounting. You may need to do a better job of selecting employees in the first place.
You may need to hire a security expert to review your procedures for dealing with customers, handling cash, and securing inventory. You may need to organize a professional development program for your employees outlining any new procedures and emphasizing the benefits of being part of a prosperous business.
If an employee is caught with incriminating evidence, you may call the police and press charges, you may fire the employee, or if the offence was minor you might be able to work out an ad hoc rehabilitation program. In all such cases it is essential to carefully document your evidence and your actions. In general, problems involving people need to be dealt with carefully and according to established procedures.
