J-Kay’s Gerace uses POS software to alert her to unusual transactions. Each time one occurs, she talks to the employee involved. “I question them every day on certain issues,” she says. “Maybe I’m going over gross profit exception reports and I see they changed a price. I go to them and say, ‘Why did it happen? Next time when it happens, write down why. Always cover your tracks.’”
Simply letting employees know she’s paying attention helps thwart unsavory activities, Gerace says. “The more they know you’re watching, the less likely they are to try something.”
Better Hiring Even with these types of checks in place, light-fingered employees are still costing businesses money. The U.S. Department of Commerce estimates that annual losses caused by bad hiring decisions, absenteeism, drug abuse, and theft add up to $75 billion per year.
Creating an honest workforce starts with the hiring process. “We try to hire honest people,” Gerace laments. But sometimes even applicants who scored at acceptable levels on honesty tests have turned out to be dishonest. Honesty tests can be helpful, but savvy thieves know how to answer them. And with tight competition for good employees, sometimes retailers have to hire staff who score well, but not perfectly. That can be just the opening internal thieves need.
John Challenger, CEO of global out-placement firm Challenger, Gray & Christmas, says tests are fine, but there are other things to look for that might help hiring managers assess a prospective employee’s trustworthiness. “Look for embellishments on the résumé or in the interview,” he counsels. “Ask directly, ‘How important are honesty and integrity on your value scale?’Give them the opportunity to voice their values. You can usually tell if honesty and trust are core to how they see themselves.”
He also advocates doing background checks and contacting prior employers, not necessarily references provided by the candidate. “Check with previous bosses,” Challenger suggests. “Most people will give you references who will say good things about them. But if you check with the candidate’s last bosses, you might get a better, more accurate read.” Many dealers use outside sources for background and reference checks, usually for a one-time fee. Some, like Employment Screening Resources, offer services specifically designed for small- to medium-sized businesses starting as low as $175.
Before administering honesty tests or developing new interview questions, it’s a good idea to check with a specialist in employment law to make sure you use these tools correctly.
The Right Mix Of course, few yards need to or can afford to implement every loss prevention tactic, and every solution is not appropriate for every dealer. The key to effective loss prevention is finding the right mix of strategies and tools for your particular business.
“There’s no one activity or device that is the catchall or supreme solution for deterring theft. If there was, I’d be investing in it really fast,” quips Gunnerson. “But anything you use gives you an advantage.” —Margot Carmichael Lester is a freelance writer in Carrboro, N.C.
