Theft is a major concern for every kind of retailer – losses from theft of various kinds equates to about 1.5% of the retail sector’s bottom line on average. That stat has been consistently increasing in recent years, including in 2020 despite countrywide closures for retail outlets.
For cannabis retailers, this statistic is even more grim. Despite the legalization of the cultivation and distribution of the plant, a significant illicit market persists due to a major price differential in legal vs. illegal sale. Regulations and a tax burden make illegal cannabis a far cheaper option, and a lack of storefront property makes unlawful sellers harder to track.
This makes it all the more important to understand what kinds of retail crime dispensaries should be aware of and how to best design your security to counter these threats. Though the risk is higher for those working in the cannabis industries, the threats are similar, so you have plenty of experience to draw from.
There are two primary sources to focus on for retail crime: internal and external. While there is plenty of possible overlap between the two, you can split your security plan to target each threat individually.
Employee theft is a lot more common than most people think and can be far costlier for a business than theft from outside sources. Far from the big showy heist most films portray when showing workers pulling an ‘inside job’, internal theft is usually much more insidious, subtle, and can go on for years without being noticed.
Employees are far more intimately aware of the security system in place than normal thieves and are in a better position to exploit its weaknesses. Unattended security cameras, doors regularly left unlocked or open, and poorly managed inventory systems are exploited often and easily by opportunistic employees looking to make some cash on the side or just get some free supply for their own use.
Poorly screened employees carry the additional danger of working with outside criminal enterprises, supplying them with insider information on holes in your security system or how to target other employees making deliveries or receiving supply shipments.
Countering internal threats is based primarily on the systems put in place rather than manpower. Strict systems put in place to track inventory as it enters and exits your business, access to inventory storage, and consistent monitoring of employees through security cameras and observation are your primary tools.
Careful screening is also imperative – an intensive interview process and background checks are a good way to nip the problem in the bud. You also want to make sure your employees have a proper incentive structure that ensures that those who have greater access to your product and cash also have far more to lose than gain if they were caught slipping. Managers or supervisors with a good salary and benefits have far more to lose than those who are paid poorly, for example.
As we’ve covered before, the cannabis business has a much greater potential for external risks than other retail outlets due to the nature of the business. The potential for both unscrupulous customers to grab some product while employees are distracted and career criminals targeting your business are comparatively high, so security systems need to be airtight to counter these threats.
Normal shoplifting, luckily, is pretty easy to counter for the cannabis industry. Keeping limited amounts of product in the storefront behind barriers is enough to deter most would-be shoplifters, and training your employees to keep a watchful eye on both the product and any customer giving signs of possible criminal intent should cover almost all possibilities.
Threats from thieves, especially those who are part of an organization, can be much trickier and much more dangerous. Even normal retailers are noting that thefts coming from organized crime involve more violence than previous years, and the high-stakes nature of targeting dispensaries puts you, your employees and your customers at even greater risk of harm.
Countering external threats uses the same systems that target internal ones, but focuses primarily on your human resources. Training employees to watch for certain behaviors while both on and off the store’s property can help give you advance warning of potential targeting and can help them keep out of harm’s way.
Combatting both internal and external retail crimes require you to go beyond the basics – some poorly monitored video surveillance cameras and untrained guards aren’t going to cover all the bases and might just make the situation worse in more dire scenarios. CCSS not only provides a comprehensive cannabis security plan that is compliant with all local and state ordinances, they can provide expert training services to your employees, and give you peace of mind.
Retail crime isn’t going anywhere soon – if trends continue, we’ll begin seeing more and more businesses experiencing significant losses due to unorganized and organized theft. With the right preparations and help, you can buck the trend and keep your business operating smoothly and profitably. Surviving the incident is half the battle, ensuring you are made whole and sustainable is the other.