Reducing Shrink by Tracking Returns and Lost Items

by Andrew Hoeft | Dec 27, 2016 12:00:00 AM

Monitoring and tracking returned products is a fundamental part of every retail business. As a point of reference, a “return” refers to any item previously purchased by a customer that is returned to the customer service associates.
Returned items happen for several reasons: It could be a product quality issue, the item was rung up incorrectly, the item was purchased with a coupon that was not applied appropriately, a customer experiences buyer’s remorse, realizes they do not need the product, etc.

Tracking Returns

Identifying trends within product returns can have a significant impact on shrink. If product quality is identified as the main issue by recording the occurrence, associates and management can see if this return is an anomaly occurring at one store or if this is something that is happening several times across multiple stores. Further, management will be able to tell if this is a supplier issue or just a one-time event. Tracking each return and logging the related problems will lead to actionable steps in reducing the frequency later down the line.

As an example, this tracking may help you identify that the same sandwich in your deli department is repeatedly returned for poor quality. Now the focus is on the cause (poor production quality) rather than the symptom (returns), which leads to loss prevention.

Tracking Lost and Found

Plain and simple, a product that is left behind by a guest is considered to be lost and found. Though being able to hold and track lost items for customers is not entirely about shrink or loss prevention, it does wonders for a company’s customer experience.

For example, a situation arose in a Midwestern supermarket with an elderly lady who lost her wedding band that she wore for over 60 years, and her husband recently passed away. The Loss Prevention (LP) team researched via video cameras and was able to identify her as the ring owner. By tracking the ring from where it was found backward, the LP team was able to identify the woman who lost the ring, follow her to the registers, and then use information acquired at checkout to eventually get in contact with her. This woman was given back a valuable token and is likely to retell the story, which improves customer retention and awareness.

Here, the focus of LP was not only on investigating the loss of the ring, but also training the customer service associates on taking reported loss seriously. They can ask specific questions that collate as much information and return the merchandise or personal belonging to the shopper.

Something to Consider

Train your staff by putting them in situations that promote empathy by describing the loss of something personal.

For example asking them these types of hypothetical questions:

  • What if you lost your iPhone?
  • What if you lost your wallet?
  • How much stress would that put you in as an individual?
  • What if the retailer called you and was able to return your lost item?
  • Would you be likely to share your story?
  • How awesome would your supermarket be if they went out of their way to look for you and returned your property?

All things considered, tracking returned and lost products is a measure aimed to control shrink. Thoroughly training customer service staff can significantly improve the customer’s experience. By identifying consistent trends, it is easy to locate potential barriers in a supermarkets operation. With proper notation of information for lost items, a supermarket will pay huge dividends in shopper experience.

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