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Hard Rock Keeps the Beat with LP Innovations

Hard Rock Cafe Case Study



...The Challenge

While evaluating options regarding an effective and efficient cafe audit process after an organizational change, Hard Rock Cafe compared two alternatives -- creating an internal audit team versus partnering with an external loss prevention firm with the required expertise and 'fit' with Hard Rock's company culture and objectives.

...The Solution

In 2003, Hard Rock Cafe contracted with LP Innovations (LPI) to provide the required audit services. "The LPI value proposition is what first drew our attention to the organization," said Dave DiPerna, Director of Accounting, Hard Rock Cafe. "Our analysis showed that we were able to get a professional nationwide audit service at a lower cost than if we added and managed our own audit staff. We also like the objectivity and independence that an external audit company provides."

Compliance & Control Audits are the core services required by Hard Rock Cafe. Initially, LPI was contracted to perform a two-day audit at each cafe once a year. Two years later, Hard Rock increased the number of LPI audits to two per year for each cafe. The audit program, developed both by Hard Rock Cafe and LPI, includes areas that require on-site focus such as cash controls, employee information, accounts payable, food & beverage inventory, merchandise inventory, safety, security, and memorabilia verification.

Furthermore, Hard Rock requires that each LPI Regional Loss Prevention Auditor (RPLA) conducts three supervised Hard Rock audits before he or she operates on a solo basis.

"I was impressed by LPI's willingness to meet our needs regarding auditor training. One of our requirements is that each auditor walk into their first solo audit already having the experience to properly execute the Hard Rock audit. Our cafe managers are very busy and do not have time to deal with inexperienced auditors, and the LPI auditors effectively perform our audits without disrupting cafe operations," commented DiPerna.

LPI also provides their Business Abuse Line to Hard Rock Cafe. This service allows cafe managers and financial assistants to anonymously report fraud, theft, unethical behavior or suspicious activity via a 24-hour/7-day phone service. Investigations are also part of the LPI service set used by Hard Rock. Internal investigations are pursued based upon audit discrepancies, information collected via the Business Abuse Line or employee complaints.

"Our loss prevention requirements are very broad based on our unusual business model. We have two distinct and sizable businesses within each cafe - food service and retail merchandise. In addition to that, we have the world's largest collection of music memorabilia with unique, valuable pieces displayed in each cafe," remarked DiPerna.


"Our audit arrangement with LPI has had a significant impact on our business. We essentially have the flexibility and control of an in-house audit team without the higher overhead cost. Since implementing the audit process with LPI, cafe compliance with company policies has improved dramatically and as a result we are able to identify and resolve problem areas more quickly," stated DiPerna.

LP Innovations is the only nationwide, single-source provider of loss prevention solutions for the retail industry. Since 1998, LP Innovations has provided its rapidly-growing customer base with a variety of innovative solutions proven to protect profit and reduce shrink. From nationwide loss prevention auditors and regional loss prevention managers, to a dedicated staff of data analysts, client service representatives, and more, LP Innovations provides its customers with best-in-class services, building stronger and more effective loss prevention programs. Learn more today at


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Hard Rock Cafe

Hard Rock Cafe is one of the premier dining and retail merchandise brands in the world.

Throughout their worldwide presence, their need to balance both food & beverage and retail merchandise against loss prompted them to look for assistance. They found it with LP Innovations.


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