LP Magazine

SEP-OCT 2018

LP magazine publishes articles for loss prevention, asset protection, and retail professionals covering shrinkage, investigations, shoplifting, internal theft, fraud, technology, best practices, and career development.

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in sales per inventory, the average shrink is expected to decline by X basis points. Q Customer Satisfaction. The produce freshness score from customer feedback was used as a proxy for customer satisfaction. For each 1 percent increase in the average customer satisfaction score, the average shrink decreases by X basis points. Decision Tree Model The second predictive model used was a decision tree. We used decision trees to understand the relationship between various factors like shrink, sales, and inventory, and produce freshness, customer ratings, and produce per square foot. Store-level shrink (%) was divided into three categories namely low, medium, and high. A decision tree with shrink categories as the target variable was plotted to understand how PARTNERING SCIENCE, DATA, AND ASSET PROTECTION TO TACKLE RETAIL SHRINK They have a great shopping experience. You have greater peace of mind with a solution that secures your profi ts and property. Bosch empowers you to build a safer and more secure world with solutions that enhance safety, reduce shrink, and help you improve merchandising, operations and customer service. Bosch integrated security and communications solutions enrich the customer experience and deliver valuable data to help you increase your profi tability. Learn more at http://bit.ly/BoschSolutionsforRetail Decision Tree: How do variables interact with one another to classify a store into various levels of shrink? Rules From DT Shrink 1 Sales/Inventory Ratio < Average Turnover > Average $ per SQFT < Average + 15D Customer Ratings < Average Store Inventory < Zone inventory by 30% High 2 Sales/Inventory Ratio < Average Turnover > Average + 15D Store Type = 1, 2 High Store Type = 3, 4, 5 Store Inventory < Zone inventory by 65% High Store Inventory < Zone inventory within 65% $/I Ratio > Avg - 25D High 3 Sales/Inventory Ratio > Average Customer > Average GM% < Average Customer Ratings < Average + 15D Low GM% > Average Customer Ratings > Average Low Customer Ratings < Average $/FT > Average Store Inventory > Zone inventory within 10% Low $/FT < Average Store Type = 1, 2, 3 Low 4 Sales/Inventory Ratio > Average GM% > Aver- age Turnover < Average Low Turnover > Average $/FT > Average Low 43 LP MAGAZINE | SEPTEMBER–OCTOBER 2018

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