In today’s retail environment , successful retailers are continuously exploring ways to protect and improve profitability. Outsourcing certain functions such as IT, Human Resources and Loss Prevention are proven methods of reducing operating and payroll costs, increasing productivity and improving profitability.
Here are 5 reasons why retailers choose to outsource their Loss Prevention function:
A Fixed, Structured Budget
Outsourcing immediately reduces overhead burdens such as payroll, benefits and travel expenditures. The costs of an outsourced program can be structured to include all costs including travel expenditures, therefore creating a finite budget number. The ability to set these costs allows for a more structured budget and hard costs to run the program and function. Structured properly, when a retailer opens or closes a location, they immediately know the cost to operate the new location or the cost savings from a closed location.
Expand your Program’s Reach
Outsourcing with the right company provides more “boots on the ground,” and allows the retailer to not only react to more simultaneous situations, but also have a greater proactive presence. A larger loss prevention presence assists in the overall reduction of loss.
Increase Expertise and Knowledge
Performing services in a variety of retail companies and cultures, an outsource provider brings a more detailed perspective on the industry trends, programs and global concerns. Outsourced personnel work in a variety of environments and locations, and can use their collective knowledge and expertise to help all their clients.
A Cost-Effective Solution
In the majority of situations, outsourcing can bring more program elements and “touches” to individual store locations, and still often costs the same or less than an internal function. Being able to have a loss prevention program that ensures a consistent presence in all store locations enables a retailer the opportunity for increased profitability.
Results. Results. Results
Without continued results, an outsourced company could not continue to promote services. There is no resting on their laurels. Companies that have several examples of proven results show that they can continue to increase bottom line earnings and profitability, year after year.
While outsourcing is an option that has helped hundreds of retailers tackle shrink and loss, there are many terms to understand in order to for outsourcing to be successful. Factors including your current shrink or loss rate, business needs, program direction, and culture all contribute to the decision to outsource program functions. There is no doubt that utilizing an outsource provider can help you in your loss prevention goals and objectives. To find the right provider here are some questions to ask are:
- Do they have adequate and reliable resources near all store locations?
- Are all staff, including those in field locations, full-time proprietary employees?
- Are all appropriate staff trained and certified?
- How will they integrate into the corporate culture?
- Do they have the appropriate insurance coverage and how do they demonstrate it?
- How do they measure success of the program?
For more than a decade, LP Innovations has provided trusted solutions and proven results to retailers across all verticals.
If you are thinking about how outsourcing may be able to assist your loss prevention efforts,
download our free whitepaper to see if outsourcing will work for your company.