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Retailers: Why Leave the Back Door Open to Theft?

Date Published: August 03, 2015 | Last Updated:September 15, 2023 | By Accurate Background
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Background checks provide critical protections for your reputation, brand, and profits

It’s no secret that theft is a huge issue when it comes to the retail market. Whether it is someone palming a candy bar or walking off with expensive clothing and accessories, retailers have learned to accept that “shrinkage” from theft is a part of doing business. Front-door theft accounts for the majority of retail shrinkage, but it is closely rivaled by what employees are taking out the back door. In fact, the FBI notes employee theft as one of the fastest growing crimes in the U.S.

A recent study from The National Retail Federation/University of Florida National Retail Security Survey revealed that theft cost U.S. retailers $44 billion in 2014. Employee and internal theft accounted for 34.5 percent, or approximately $15.2 billion of that cost, just behind shoplifting at 38 percent. The American Society of Employers has estimated that businesses lose 20 percent of every dollar to employee theft.

Most large retailers recognize the value that screening a potential employee can have in protecting their stores and have adopted background screening as a best practice. However, this practice has yet to be fully embraced by smaller retailers. During the NRF Protect 2015 conference, we polled our booth visitors and met many small retailers who still are not background screening. The question is why?

The reasons varied from perceived concerns over cost, to disrupting the “family” work environment, to questioning the value of screening a workforce with a high turnover rate. However, when you consider the large investments made into security cameras and anti-theft devices that protect the front door, the cost of a background check to secure the back door seems minimal. For less than $30 (the cost of a few hours of pay), most retailers can sufficiently screen an employee to ensure they are making a smart hire.

A background check can tell you if the candidate has a past criminal history of violence or theft. If so, they may not be the ideal candidate for the job…at least without further information.

Behind the scenes, your employees are privy to large parts of your business (customers, inventory, billing systems, etc.). Insight into their background information not only protects against cash and merchandise shrink, but also reduces the potential for brand and reputation damage.

Another common concern we heard was not knowing the proper background checks to run. Below are three common checks you should consider when hiring retail employees:

  1. Run a social security trace and address history with a 7-year county criminal history search. At a minimum, these searches will allow you to make an informed hiring decision. The Social Security trace and address history search will provide you with name variations and previous addresses to search for criminal records at the county level.
  2. Cast a wider net with a statewide criminal record search. While certainly not a requirement, a statewide criminal record search provides access to a larger multi-jurisdictional database to search for convictions that may have been outside of your county search. A statewide criminal record search can be a valuable tool for identifying red flags on a candidate that can then be verified at the county level. However, it’s important to note that statewide repositories are not yet available in all states.
  3. Order a motor vehicle report if you have drivers. This will provide a 3 to 5 year driving history on your applicant. Out of state driving related charges and vehicle-related crimes are also often included in this report.

Even if you implemented all three of these suggestions, the cost to your organization would still be under $100 per employee – a relatively minimal expense considering the thousands that may already be walking out the back door. Once you start background screening, the value will prove itself, and you will always have this security measure in place.

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