Oh my god - new definition for a sweetheart (Retail shrinkage)

Sweethearting is a term used in the retail shopping industry to mean intentional margin loss/shrink through employee theft at the cash register or the cash counter. Sweethearting is the most common type of employee theft.

Sweethearting is unauthorized giving-away of merchandise or products without charge to a "sweetheart" customer (e.g., friend, family, fellow employee) by the fake scan or ring-up of merchandise by the cashier or the stores payment clerk. Employees operating cash registers can create numerous ways to sweetheart

• Scan avoidance: By deftness of hand the product is not scanned at all.
• Price overrides: Price is shown less than what it should be
• Refund fraud, gift card fraud: create a fraud with a refund of a merchandise or fraudulent uses of a gift card
• Invoicing scams: Happens at the input level or at the time of receiving the material from the supplier.

Sweethearting can be difficult to detect. Common countermeasures include use of CCTV surveillance cameras and security guards checking customer receipts at exits.

 

So Sweethearting exists and what do we do about it? First tell the employees that they too are being watched and at all the time. Second thing is to tell the employees that shrinkage means reduction of profits and that means less salary and less commission or incentives.

 

If the employees are vigilant the shrinkages will get reduced. Pay the employees a part of the money saved due to reduced shrinkage. So instead of having the employees work against you, make them part of the team that works for you cracks the menace of Sweethearting.

Popular terms and concepts in Retailing & Retail Marketing

1.      Slotting fee: A slotting fee, slotting allowance, pay-to-stay, or fixed trade spending is a fee charged to producer companies or manufacturers by supermarket retailers in order to have their product placed on their shelves. The fee varies depending on the product, the manufacturer, and market conditions.

In addition to slotting fees, retailers may also charge promotional, advertising and stocking fees. Many retailers earn more profit from agreeing to carry a manufacturer's product than they do from actually selling the product to retail consumers.

Many argue saying that slotting fees are unethical as they create a barrier to entry for smaller businesses that do not have the cash flow to compete with large companies.

2.      Push money: Push money is a special incentive that is offered to a retailer in exchange for focusing sales efforts on a particular product or brand of products. This incentive may take the form of a special commission for all generated sales related to the specified product or brand, or come in the form of some other type of compensation, such as a paid vacation or holiday.

3.      Point-of-purchase displays, or POP displays: are marketing materials or advertisements placed next to the merchandise it is promoting. These items are generally located at the checkout area or other location where the purchase decision is made. For example, the checkout counters of retail stores are cluttered with cigarette and Chocolates and many other impulse purchase category items.

4.     Point of Sale (POS):  refers to the area of a store where customers can pay for their purchases. The term is normally used to describe systems that record financial transactions. This could be an electric cash register or an integrated computer system which records the data that comprises a business transaction for the sale of goods or services

5.     Mom and Pop stores/Kirana shops: A small, independent, usually family-owned, controlled, and operated business that has a minimum amount of employees has only a small amount of business volume and is typically not franchised, therefore open for business only in a single location. Typically running on a very tight budget and wafer thin margins they are profitable only because the entire family pitches in and run it as a business.

6.      Brick and mortar store:  refers to retail shops that are located in a building as opposed to an online shopping destination, door-to-door sales, kiosk or other similar site not housed within a structure. Brick and mortar are the traditional touch, feel and tryout type of supermarkets. They are real and not virtual.

7.      Planograph: Visual description, diagram or drawing of a store's layout to include placement of particular products and product categories.

8.     Comp sales: Comparable-store sales is a measurement of productivity in revenue used to compare sales of retail stores that have been open for a year or more. Historical sales data allows retailers to compare this year's sales in their store to the same period last year.

9.   Cyber Monday: Cyber Monday is one of the busiest shopping days of the year for online retailers. This comes after the Thanksgiving weekend. Retailers notice a spike in sales on this day as many consumers who were too busy to shop over the Thanksgiving weekend or did not find what they were looking for, headed to the web on Monday from work or home to find bargains.