Loss Prevention - Role Specific Guides

The ECRA Role Specific Guides (RSGs) to Shrinkage are documents designed to assist both retailer and supplier personnel in the development of their knowledge of the topics of Shrinkage and Loss Prevention – specifically as it relates to their functional role/job.

Shrinkage is a topic for which many people are stakeholders within their roles – whether they realise it or not! A person’s role may be impacted by shrinkage as a result of their actions or the actions of others. Similarly, people may make decisions in their own roles that contribute to shrinkage impacts on other people’s roles.

ECRA Role Specific Guides (RSGs) to Shrinkage have two principal pages.

1. The first/front page has sections describing the impact of shrinkage on a particular job role, what actions a person in that role might take to assist in loss prevention and indications of flow on effects through the value chain of decisions made (good and poor) in terms of shrinkage.

2. The second/back page serves as a template for action planning and might be used as part of training and development or in annual goal setting. Several RSGs have been developed for roles more commonly found across businesses and can be accessed by clicking on the link of the chosen role.

Additionally, a blank template has been provided for users to develop their own RSG for roles not already provided or where provided RSGs do not sufficiently match responsibilities, and is available here.

ECRA Role Specific Guides (RSGs) to Shrinkage available - Download here:

ECRA Shrinkage Guide - Supplier
           ECRA Shrink Educational Guide - Marketing Manager
           ECRA Shrink Educational Guide - Sales Executive
           ECRA Shrink Educational Guide - Merchandiser
           ECRA Shrink Educational Guide - Supplier Director

ECRA Shrinkage Guide - Retailer
           ECRA Shrink Educational Guide - National Asset Protection Manager
           ECRA Shrink Educational Guide - Retail Buyer
           ECRA Shrink Educational Guide - Retailer Area Manager
           ECRA Shrink Educational Guide - Retailer Goods Receiving Team
           ECRA Shrink Educational Guide - Store Layout Design Manager
           ECRA Shrink Educational Guide - Store Manager

ECRA Shrinkage Guide - Supplier & Retailer
           ECRA Shrink Educational Guide - Distribution Manager
           ECRA Shrink Educational Guide - Finance Manager
           ECRA Shrink Educational Guide - Human Resource Manager
           ECRA Shrink Educational Guide - IT Manager

Loss Prevention - Known/Unknown Loss Matrix

The ECRA Known vs. Unknown Loss Matrix is a ‘ready reckoner’ that can be used by supplier companies to quickly assess the way in which various retailer trading partners treat different loss types in their businesses.

The matrix should be considered by suppliers prior to entering discussions with a retailer regarding loss for (at least) two reasons.

Firstly it helps ensure that both parties are on the same page and there is clear understating of how the loss type is captured and treated by the retailer and their anticipated depth of knowledge of the particular loss type and its drivers.

Secondly it can provide some indication as to the likelihood of information and data being recorded by retailers and the potential accuracy of the information.

Access this resource for free:

• ECRA Known vs. Unknown Loss Matrix

See also the ECRA Loss Type Data Granularity Assessment Tool.   

Loss Prevention - Data Granularity Assessment Tool

The ECRA Loss Type Data Granularity Assessment Tool is designed to assist suppliers in determining priority project planning when looking to engage with retailers to collaboratively address shrinkage.

The tool can be used after discussing with retailers the levels of granularity at which they capture data for each known loss type in terms of regularity, location, product and amount.

By inputting the appropriate granularity levels at a retailer/loss type level, the tool provides back a ‘relative value’ which represents the strength likely to be found in the data available from a given retailer for each loss type.

This in turn can be used as a quantitative consideration when planning which loss types to address as priorities along with the qualitative factors involved. The Loss Type Data Granularity Assessment Tool is a Microsoft Excel document. 

Access this resource for free:

• ECRA Loss Type Data Granularity Assessment Tool

See also the ECRA Loss Prevention - Known/Unknown Matrix.

Loss Prevention - Measures & Metrics - A Guide for the Industry

ECRA has developed a suite of measures and metrics from which retailer and supplier trading partners can identify those which are most valid and appropriate for their particular situation, considering the data granularity available to them.

Each loss prevention project has different dynamics and characteristics meaning that there is not a ‘one size fits all’ measure for loss. However it intuitively makes sense that trading partners agree and align on loss measurement going into projects so that a shared perspective of the ‘before and after’ pictures can be established.

To assist, the ECRA Loss Prevention Group, consisting retailers and suppliers, has provided the following information:

1. A suite of Loss Prevention Measures
2. A tool for calculating results for each of the measures   
3. An overarching set of considerations to be used for reference   
4. Advice and a retailer specific matrix regarding the key aspect of known and unknown loss

Loss Prevention Measures

The below suite of measures developed by ECRA can be applied at either SKU or category level.  ECRA has also developed a Loss Prevention Calculator Tool (in Excel) which can be used for each of these measures (provided below).

1. Loss Reduction – Dollars Value
2. Loss Reduction – Dollars Percentage
3. Loss Reduction – Units Volume
4. Loss  Reduction – Units Percentage
5. Sales Increase – Dollars Percentage
6. Sales Increase – Units Percentage
7. Loss to Scan Sales Ratio – Units Percentage
8. Loss to Scan Sales Ratio – Dollars Percentage
9. Loss to Store issues Ratio – Units Percentage
10. Loss to Store issues Ratio – Dollars Percentage

Loss Prevention Calculator Tool

Use ECRA's Loss Prevention Calculator Tool created in Microsoft Excel to help you measure loss in the above categories.

• Download:  Loss Prevention Calculator Tool.xls

Overarching Considerations

The measures and their metrics should not be looked at in isolation. There are several overarching considerations which project partners should take into account when identifying how they will measure loss and the impacts of efforts to address loss.

ECRA recommend that project partners take these considerations into account to help identify similarities, differences and levels of consistency in the scope of their projects.  Project partners are then encouraged to agree upon and utilise appropriate measures and metrics from the suite provided.

Aspect	Considerations
Geographic / regional  impacts	Grouping of stores by region and undertaking comparison of shrinkage metrics by region/area/post code provides understanding of geographic impacts on shrinkage levels. Assists in consideration of appropriate actions by geography
Demographics	Clustering of stores by demographic value assists in understanding the levels of shrinkage difference inherent in varying demographics. Assists in consideration of appropriate actions by demography.
Events, Promotions and Seasonality	Measuring on versus off promotion, in versus out of season and for particular events provides insight to the relative levels of shrinkage associated with these variables and assists in action planning.
Supply Chain ‘touch points’	The number of handover points in different supply chains gives rise to varying opportunities for shrinkage. Supply chain touch points should be a consideration when measuring shrinkage to ensure the level of shrink variance associated with different numbers of handovers is taken into account in any comparisons.
Known versus Unknown loss	The degree to which shrinkage is known versus unknown should be taken into account. Wherever possible the aim is to move shrinkage to the known categories through detailed study and analysis. Known shrinkage measures will be of great value in prioritising loss prevention and in the tactics then employed.
New products	New products have significant shrinkage potential for many reasons (data integrity, popularity and promotion, staff knowledge levels, unrecognised shrinkage risk etc). New products may need to be considered in isolation from mature products when determining overall shrinkage levels and appropriate responses.
In-store location of the category	Identifying differences in where categories are located within the store should be part of shrinkage measurement considerations to determine if stores are ‘like for like’. Busier locations and locations tended to by staff may show different shrink rates to other in-store category locations, even in stores of similar demographic value.

Known and Unknown Loss Considerations

The ECRA Known vs. Unknown Loss Matrix is a ‘ready reckoner’ that can be used by supplier companies to quickly assess the way in which various retailer trading partners treat different loss types in their businesses. This is a key discussion prior to embarking on loss prevention projects as it identifies the degree to which any available data is attributed to truly known causes of loss.

• Access:  ECRA Known vs. Unknown Loss Matrix