LP Magazine

JAN-FEB 2019

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.

Issue link: http://digital.lpportal.com/i/1078914

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Page 47 of 77

BUMPS IN THE ROAD 46 JANUARY–FEBRUARY 2019 | LOSSPREVENTIONMEDIA.COM to stores and to ensure that "they are delivering exactly what the store ordered, no more and no less," said Smith. Providers are required to hit certain plateaus on key performance indicators, "so if 99 percent gets to the store, we can drive that change to get 100 percent." More than fraud, human error can pose a challenge for carriers trying to make convenience store deliveries quickly. 7-Eleven stores help to cut down on the risk of errors by making it a priority to review orders, having internal resources that make it possible, and by doing the scanning necessary to validate that all product is received. Monitoring theft trends will also continue to be important. The risk of criminal activity associated with cargo in transit has always been strongly linked to specific goods, days, locations, and routes, making planning and routing of transportation an important consideration in mitigating risk to cargo. And some experts suggest that the rise of e-commerce could alter the risk landscape. For example, pool distribution models or the use of smaller distribution centers to speed consumer deliveries may change where and when cargo is stolen. Some changes may already be showing up in the data. In a 2011 study of cargo theft, which analyzed the previous five years of cargo theft, data showed theft occurred significantly less often on Wednesday and Thursday, at just a fraction of the rate on weekends and substantially less frequently than on Friday and Monday. Cargo remains at its most vulnerable on the weekends, according to the latest data, but Wednesday has emerged as a higher-risk time, with thefts now occurring at a rate on par with Friday and Monday. As cargo moves more frequently, to more places, it's starting to look like no day will offer refuge to shipments in transit. Tracking enhancements in theft prevention should also be a persistent priority for LP, suggests Ron Heil, CPP, CSC, CHS, senior security advisor with Business Protection Specialists, a security consulting firm. In addition to GPS and other tracking technologies, "old" solutions are getting an upgrade. "Seal technology is changing quite a bit," Heil said. "It's not as easy to counterfeit or remove and put seals back on." On the horizon are perhaps transformative technological solutions. Brigid McDermott, vice president of blockchain development for IBM, says that blockchain technology, by making it easier to verify legitimate carriers and the loading and unloading of shipments, can help to deter and practically eliminate some forms of cargo theft. Pelli's advice is for retail companies to expand their view of risk. He says retailers are currently more concerned about the potential of physical vulnerabilities in their shipping partners, but that they need to start paying greater attention to whether the cyber security of those companies is also up to the task. The fallout of cyber vulnerabilities in the supply chain was underscored in 2017 when Maersk, which handles about one out of seven containers shipped globally, was crippled by a ransomware attack, causing weeks-long supply delays and disruption. Cyber attacks become more viable as more nodes in the logistics chain are connected, even as that very connectivity may help to minimize cargo theft. In "Contribution of physical internet containers to Mitigate the Risk of Cargo Theft" (an article published in 15th IMHRC Proceedings in 2018), researchers from Georgia Southern University observed that using easy-to-interlock smart containers in an open, interconnected logistic system has the potential to reduce cargo theft. They concluded: "Results suggest that through the modularity and standardization, the application of physical internet containers will significantly improve the logistics performance and reduce cargo theft risks." However, it is only possible to extract security gains from greater supply chain connectivity if cyber vulnerabilities are included in the risk management equation. The growing importance of cyber security in cargo transport is perhaps most obvious in the rise of autonomous long-haul trucking. Outfitted with sensors and guided by self-driving software, several companies have already announced successful test runs of 18-wheelers across the country. A truly driverless truck would change the nature of trucking—and protecting cargo. To many analysts—and to the International Transport Workers' Federation worried Ron Heil US Cargo Theft by Day of the Week, 2017 Source: SensiGuard Supply Chain Intelligence Center. "Cargo Theft Annual Report United States and Canada. 2017" Sunday Monday Tuesday Wednesday Thursday Friday Saturday 0% 5% 10% 15% 20% 25%

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