LP Magazine

MAY-JUN 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/1121134

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Page 40 of 84

Supply Chain Continues to Change M uch more attention is now being paid to supply chain than ever before. That is evidenced in the pages of this magazine where the editors are focusing more and more articles related to supply chain security and on-shelf availability. Today, supply chain is a different animal than it was just a few years ago. Below are my observations on how supply chain continues to evolve in our industry. Analytics A number of us have been using analytics in the supply chain for many years. Here's the difference: on the standard retail model (store side), vendors have produced software packages for years. Those packages were developed strictly for store-side use, and they have done a good job with the product mix over the years. Having said that, those same software producers have not produced workable products for the supply chain, which has forced those of us on the supply chain side to get creative. Many of us have worked with our individual IT and operations departments to create our own in-house analytical platforms. For instance, when I was at Blockbuster (as it was growing and at its peak), we created our several very specific data drives to earmark potential issues. We knew that internally the highest likelihood of internal losses occurred in the consolidation area of our distribution center (DC) in McKinney, Texas. This area of the DC consisted of fifty-two aisles where employees consolidated product (such as videos, DVDs, games, and so forth) that would be shipped to 4,800 US-based stores as well as some stores in Mexico and Canada. We created our own exception reports that pinpointed loss ratios and the highest days of the week for losses. We worked with Sensormatic and installed the first wireless track camera system in the US. Between the exception reports and the use of the new camera technology, we were able to eliminate the loss in consolidation by 82 percent. While our exception system was good, it was by no means great. I have known Glenn Master for over twenty-five years and can say firsthand that he has continually created analytical systems at various companies. I would say that he is one of the best if not the best in implementing these systems within the supply chain. When we discuss supply chain, we are most certainly looking at an enormous animal with not only lots of moving parts but also a significant number of companies/vendors in a given system. Using Blockbuster as an example, we found that from the time a product was shipped to us (for example, a specific movie title, say Batman) for distribution, it would be touched by multiple companies just getting to us. Then we would have to handle and prepare the product for delivery to thousands of stores, which meant the product had to be touched by multiple delivery companies. We cannot forget that all of the companies involved either did not utilize scanning equipment or the equipment involved was from various platforms. In the end we created a multiuse scan tag that was equipped on the doorframe of every US store in the system so that we could verify all packages were scanned for receipt at store level. The technology was important, but the ongoing relationship and teamwork with operations and IT was critical. Language and System Today the supply chain faces issues that many people just do not understand or cannot keep track of. Recently I was performing a security vulnerability assessment at a distribution center. The DC had experienced a series of significant losses, and they had not been able to resolve 40 MAY–JUNE 2019 | LOSSPREVENTIONMEDIA.COM By Rod Fulenwider Fulenwider is executive director of D&L Protective Services where he is responsible for executive and workplace protection, investigations, surveillance, security consulting, and active-aggressor training. Prior to D&L, he was managing director for Pinkerton Consulting and Investigations. Fulenwider has served in loss prevention and security management positions with companies such as Blockbuster Entertainment, Loomis Fargo, Exel Logistics, Sears, and Neiman Marcus. He is the cofounder and past chairman of the International Supply Chain Protection Organization and served on the advisory board to the University of North Texas School of Criminal Justice. He can be reached at rodf@dlesi.com. SUPPLY CHAIN We recently nished a case at a DC where the company had a system in place. The system showed losses totaling just over $200,000. Our investigation revealed losses in excess of $2,000,000 and resulted in the arrests of nineteen employees.

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