Loss Prevention Strategies In The Closeout Business.

Unfortunately, theft is a part of life in the retail business. Theft prevention is always important, but when dealing with discontinued merchandise or closeouts, it may be even a bigger deal. Liquidators and warehouses that sell closeouts will often work on small margins and don’t make much profit. This makes controlling inventory essential to having a successful company. Liquidators that specialize in buying closeouts and distributing overstock goods often have security teams in their retail stores to prevent theft. Companies that help liquidate 3PL warehouses also understand the importance of theft prevention and often have elaborate security systems throughout the warehouse.

It is unlikely this problem can be completely eliminated. But here are some tips to help contain and mitigate the problem:

1. Security Cameras. By strategically placing cameras around your facility you can not only deter outside thieves from taking advantage of you, but you can prevent your own employees from stealing. Make sure everyone sees your new cameras and try to place them in areas where you can pickup broad coverage of your selling floor or warehouse space. If you sell closeouts of jewelry and other small, valuable items you may need additional cameras. Keeping track of discontinued merchandise and closeouts of larger items like furniture, bedding and lighting is easier because it is larger and less likely to be stolen.

2. Checks And Balances.It is helpful to have systems in place where things have to be reconciled. In other words, if you sell discontinued merchandise that should result in sales of $1,500, make sure you count your register at the end of the day for this amount. Another example if you want to liquidate 3PL inventory, count cartons, pallets and even individual units on a weekly basis. These products should be in specific locations where they can be tracked and viewed on camera. Closeout discontinued merchandise often disappears because thieves think this inventory is no longer on the books and won’t be missed.

3. Reorganize Your Space. A poorly organized store or warehouse is a breeding ground for fraudulent activity. Thieves love dark corners, hiding spots, and messy areas where they can stash their goods until they are ready to remove them from the premises. If you sell closeouts and distribute general merchandise for a living, these products are prime for thieves because they are easy to get rid of on the open market. Liquidators have to be particularly careful with inventory so it stays in the store or warehouse. Eliminate blind spots be replacing tall fixtures with shorter display, upgrade lighting to get rid of dark areas, and stop all movement through alternate doorways; have one dedicated entrance and exit from the building. If you are liquidating 3PL warehouses you may consider moving large pallets out of the way of cameras.

4. Receipts For Cash Returns.Sadly, return fraud is not only a “thing” but it’s huge. People will return anything and everything if they can get away with it. Used merchandise, stolen merchandise, merchandise bought at other stores, merchandise bought with counterfeit money, you name it. But if you require customers to provide a receipt for all returns you will eliminate most of this problem. Liquidators of discontinued merchandise often deal in cash but there should still be a receipt for every closeout sale transaction. Whether you are selling closeouts, pet products, overstock lawn and garden merchandise, or discontinued furniture and wall décor you can save money by preventing fraud.