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In Brief

Pattern Recognition

Retailers share crime data to track, prevent losses.

By Daintry Duffy

July 01, 2006 — CSO —

A new effort by retailers to share crime data with each other and law enforcement has loss prevention executives looking to recognize and predict patterns of illegal behavior.

The Retail Loss Prevention Intelligence Network (RLPIN), spearheaded by the National Retail Federation (NRF), is a secure, Web-based database that allows retailers to share information about major retail crimes like robberies, cargo theft, auction fraud and IP rights violations. Users can limit how much information about an incident is visible to other members—even to the point of cloaking their identity.

This aspect of the project is a key factor for retailers reluctant to share details of a loss that could give competitors an edge. Members can run reports from the system or set up automatic alerts to their e-mail or pager specific to their interests.

Shoplifted

Since 2000, retailers have spent approximately 0.5 percent of their annual sales on loss prevention staff, programs and technologies, according to an annual security survey of retailers by researchers at the University of Florida. Meanwhile, the value of shoplifted goods per incident has increased, particularly starting in 2003, when researchers believe organized crime got involved.

Average dollar loss per shoplifting incident

1997 — $212.68

1999 — $128.03

2000 — $195.73

2001 — $207.18

2002 — $265.40

2003 — $621.67

2005 — $854.83

SOURCE: NATIONAL RETAIL SECURITY SURVEY, UNIVERSITY OF FLORIDA, DIRECTOR RICHARD C. HOLLINGER, YEARS 1998, 2000-2004, 2005 PRELIMINARY REPORT. NOTE: SURVEY RESPONDENTS VARIABLE OVER TIME.

An electronics retailer might opt to be alerted whenever a robbery of electronics over $5,000 occurs within 50 miles, for example.

The RLPIN launched last month. Early members, such as The Limited Brands, Macy’s, Bell’s and Sears, were expected to be joined by at least two dozen others. Law enforcement agencies involved in the development of RLPIN, including the FBI, will start using the network this summer.

Joe LaRocca, VP of loss prevention at NRF, says a trial period showed the project’s potential. In one case, a subscriber entered information about a burglary of a particular product at one East Coast store. On that same day, LaRocca and the rest of the users watched as thieves worked their way up the East Coast targeting the same product at each location. Subscribers north of the activity reported locking up the product to prevent losses.

Users can track broad trends in theft and fraud, and drill down to the collective intelligence of RLPIN members to make decisions.

A loss prevention executive with a nationwide specialty retailer, who declined to be named because of the project’s sensitive nature, says the system will grow in value as retailers from different sectors contribute data. This company has been using the system for three months to prevent losses at new stores. “If we’re opening up a new store we’ll be able to do research and get a sense of where we need to be from a technical standpoint so that we can put in more advanced [security] systems if it’s a high-risk location,” he adds.