LP Magazine

JAN-FEB 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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forth, could reduce losses. If the potential from these upstream interventions is high, then joints of lamb would fit into the top right quadrant. This exercise should then be completed for all the selected categories in a store so that the critical few belonging in the top right quadrant are identified. Step 2: Prioritise and communicate upwards. With product categories segmented, the loss prevention team should then prioritise them and communicate the opportunity for collaboration to the broader business leadership team, especially the trading and buying teams, seeking their support for a new, multidisciplinary approach to tackling the problem of shrink in this category. Specifically, the loss prevention team should seek approval from the broader business for: ■ Agreement on a systematic data-sharing strategy with selected vendors. ■ Investment to appoint a dedicated project leader from within the organisation. ■ Alignment on the choice of vendor that is to be partnered with. To consider which vendor to select, the team could choose to reflect on the key findings highlighted in this article and answer the following questions: ■ Is collaboration with their retailers on losses a strategic priority for the vendor? ■ Does the vendor regard the retailer as a viable partner? ■ Is the vendor set up and capable of being a collaborative partner? For most vendors, partnering with their retail customers will be a strategic priority if there is evidence that collaboration can lead to sales and share growth for their products and the category. The loss prevention team should consider how they can help articulate the sales growth opportunity to their vendors by sharing their per-store sales and on-shelf availability data. Thus, the emphasis of the vendor selection phase is on understanding the relevance to the vendors of a collaborative project with you and your organisation and the vendor's respective capability and capacity to help deliver changes. Step 3: Use the ECR road map to co-discover new interventions together. To kick-start your engagement with a vendor, invest in a one-day workshop with a multidisciplinary team from your organisation—buying, supply chain, stores, and so forth—and a mirror team from the vendor, including category development, packaging design, and logistics. The workshop, over one day, should aim to follow the actual journey of a high-shrink product from the moment it is received at a distribution centre or the back door of a store through to the moment the item has been sold and taken out of a store by a shopper. After visits to the warehouse and stores, the participants should document the actual process and then brainstorm how it could result in increased shrinkage and lost sales, prioritising those failures deemed to be the most important. These failures can then be analysed to determine the underlying root causes, and once these are unearthed, participants can then brainstorm to co-discover new interventions to either implement straightaway in all stores or to pilot in just a few. The findings should then be presented to senior management for approval and prioritisation. With alignment secured, project managers should then be assigned to ensure that the changes are piloted, deployed, or if found to be unsuccessful, shelved. This one-day workshop approach is now embedded as a way of working for many ECR members and has been used on a diverse range of high-loss categories, including but not limited to mobile phones, products sold at delicatessen counters, razor blades, cosmetics, spirits, and designer men's shirts. Closing Points The aim of this ECR article, and the others in this series, is to promote new ideas and thinking that you can debate and discuss within your organisation. In this article, we shared early findings from a research project developing a maturity model that would define what great collaboration looks like on food waste. Is food waste a relevant priority for your organisation? Do the headlines in this article on what great collaboration on food waste looks like strike a chord with your understanding of collaboration? We also shared a next step suggesting that you consider initiating your own collaborative project with a vendor of a high-shrink item where the team believes that a collaborative project could unlock transformational results. What would be the top five categories and vendors you would select to prioritise for a collaboration project? Finally, if this article has stimulated you into action on this topic, we would be delighted to hear from you and the results you have been able to deliver. One manufacturer worked with a retailer to create a new product made up of unused raw materials, thus saving those materials from being wasted. This new line item is now being sold in the retailer's stores. COLLABORATION ON FOOD WASTER REDUCTION COLIN PEACOCK is a visiting fellow at the University of Leicester and the strategic coordinator for the ECR Community's Shrinkage & OSA Group. Prior to these appointments, he had a thirty‑year career at Gillette and Procter & Gamble. Peacock can be reached at colinmpeacock@ecr ‑ shrink ‑ group.com. 49 LP MAGAZINE | JANUARY–FEBRUARY 2018

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