Analyzing the Impact of Retail Crime on Workplace Health & Safety

Since 2007, the frequency of serious workplace injuries in Australia per million hours worked has fallen by 29%. This reduction in serious workplace injuries was led by the release of the Safe Work Australia Act 2008 with a further decline when this legislation came into force from 2012. Similar trends have also been seen in New Zealand over this period. This has had positive impacts for Australasian business, employees and the wider community with higher productivity, lower compensation claims, and healthier people.

However, an industry that is yet to witness a large drop in serious injuries is Retail. The reduction in serious injuries in Retail has been lower than that of other services, including manufacturing, financial, telecommunications, and administrative services. In fact, Retail now makes up 8% of all serious workplace injuries in Australia.

One of the drivers behind Retail’s under-performance relative to other sectors is driven by the impact that crime has on workplace health and safety. A study by the National Retail Association shows that retail crime across Australia has been increasing consistently over the past two years, with professional criminals committing an increasingly large proportion of this. This is supported by data from Auror’s Australasian customers where we have seen the top 10% of offenders causing over 60% of all loss.

What is more concerning for retailers is that the amount of aggression shown by offenders is increasing and has gone up 37% this year alone. In previous years, we were seeing threatening behaviours being demonstrated by 1 in 10 offenders. However, since the beginning of 2020, this has increased to almost 1 in 5. Part of this is due to Covid-19 and the impact this is having on the retail environment. However, there is also an underlying trend that was in place before Covid and the percentage of offenders showing aggression has remained high when stores have not been in lockdown operating modes.

Offenders are also taking advantage of Health, Safety, and Environment (HSE) legislation where they know they won’t be stopped if they show aggression or use a weapon. This is a tactic our customers all over the world are seeing more and more by the most prolific and organised offenders.

The combination of rising unemployment, changing store environment, Covid-19, and increasing use of aggression and weapons by offenders, is likely to increase the serious and lost time injuries of staff. This is through both physical assaults as well as mental health issues brought on by dealing with aggressive customers.

Health, Safety, and Environment (HSE) Legislation

‍The latest HSE legislation in both Australia and New Zealand places a huge emphasis on Directors and Officers. The CEO of Worksafe New Zealand makes it clear that “CEOs and Board Directors must exercise due diligence on health and safety.” A big part of this is understanding their organisation’s critical risks and risk profile, and monitoring changes to these - “Directors need to be aware of the organisation’s risks”.

With retail crime trends across the world showing higher aggression and weapon usage, and more organised retail crime, it is fair to say that the risks driven by crime are increasing. This is being played out on a daily basis with large US retailers, such as Walgreens, shutting down stores due to the impact of crime, with a company representative quoted saying “the safety of our team members and customers is a top concern”. And stories such as the Security Guard who was killed in May 2018 when a shoplifter punched him as he fled the store in Auckland, are a strong reminder of how serious the risks are.

To ensure directors and officers are effectively undertaking their duties, advice from Worksafe is “the identification of risk and the implementation and maintenance of effective controls requires input from those at the sharp end”. Therefore, it is imperative that senior management have a system and process to get information from the store teams at the sharp end to allow them to take action to keep them safe. To enable staff at the sharp end to take appropriate action, it is important that the systems and processes all pass the relevant information about the prolific and aggressive offenders to them in a timely manner. With the potential for a long jail sentence and significant personal fines, Directors within the retail sector should be asking their leadership teams if they have these systems in place. To find out how Auror is helping retailers improve safety in stores through reducing crime.

A large co-operative supermarket chain recently rolled-out the Auror Retail Crime Intelligence platform across their entire network of more than 300 stores. This was to ensure consistency of reporting, the ability to identify the top and aggressive offenders, and provide real-time notifications when threats are present to both staff at the sharp end and police. The business case delivered a strong financial ROI, but the key driver for investing in new technology was for Health and Safety reasons.

Customer Experience

The impact of increasing crime and aggression has a huge part to play in the experience for all customers. A study undertaken by the American Public Health Association titled Employee and Customer Injury During Violent Crimes in Retail and Service Businesses showed that customers were 31% more likely to be injured than an employee during a violent crime. Therefore, the retailers who can make their stores safer are going to have a significant impact on customer experience, safety, and their share of wallet.
Retailers typically invest significant amounts in customer experience and technology to improve this. However, the negative impact criminality has on customer experience and safety is often overlooked. Those retailers that are making targeted investments in loss prevention technology, not only to reduce their losses, but to increase the safety of their customers, and the customer experience. 

One major fuel retailer has recently implemented a new CCTV system across its entire New Zealand store network, incorporating world leading Automatic Number Plate Recognition (ANPR) technology integrated with Auror. This provides an in-store alert anytime a vehicle arrives on the forecourt that has previously offended at their sites, is registered stolen, and/or is known to be driven by a person that has shown aggression previously. This has reduced their loss by more than 50% but more importantly it has kept serious offenders off their forecourts - making them safer for all of their staff and customers.   

Bottom Line Impact

We often hear organisations talk about corporate and social responsibility and the triple bottom line (the impact on people, the planet, and profits). Very rarely do retailers have the opportunity to make an investment that improves all three. In the Book The Power of Habit, the author talks about how former CEO, Paul O’Neill focused on safety to transform Alcoa’s entire business and culture — lowering costs, increasing sales, quality, and productivity. For retailers, this journey can start, or be accelerated, by focusing on the impact crime is having on HSE.
Investing in effective retail crime intelligence software that empowers team members at the sharp end:

• to provide and receive intelligence; 
• engages them through a world class user experience; and 
• provides critical intelligence to senior management to make the right calls on employee and customer safety.

This will have a significant impact on your people, your customers, your profits and the wider community as a whole.

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Countdown, the largest retailer in New Zealand used Loss Prevention to drive better HSE outcomes. In the face of increasing aggression and violence in their stores (up 600% in 2020), they have made their stores safer by completely re-thinking how they approach loss prevention. They did this by:

• Moving to a safety focus rather than a stock loss focus
• Overcoming the psychological pressure on their frontline teams to "stop the bad guys"
• Refreshing their safety principles
• Updating their conflict training approach
• Upgrading CCTV cameras to be able to capture quality footage of offenders
• Using Auror to report ALL incidents and connecting the dots on offenders to get better outcomes with police after the incidents have occurred.
  

Impressively, the outcomes from this renewed focus on safety include:

• Only six serious incidents occurring across 200 stores in a 16-month period
• Stock loss continues to drop across their network (20% reduction in 24 months)