With new technologies hitting the market on a regular basis, the retail industry is constantly evolving. Most retailers now operate in a technologically sophisticated omnichannel environment that includes strategies to enhance selling, including online, mobile retail and social media marketing.
In a 2015 retail industry survey conducted by PricewaterhouseCoopers, findings revealed that technology is making it more difficult for retailers to prevent, detect and manage loss.
“At the core of omnichannel is the concept that a customer can securely purchase and receive their product in any manner they desire,” Zawoyski says. “For many retailers with legacy pre-omnichannel operations and systems, ensuring secure and dynamic customer purchasing and fulfillment is a significant challenge. Beyond the well-documented data breaches and information security risks, many retailers struggle with ensuring supply chain inventory accuracy.”
According to the PwC report, many companies haven’t fully integrated new technologies that are needed to combat loss in omnichannel effectively. One key recommendation for the report: Retailers should embrace the process of root cause analysis while increasing their use of data analytics to better spot and mitigate shrink. Zawoyski says 59 percent of respondents reported they are employing data analytics and end-to-end root cause analysis as a primary tool to identify losses.
One of the many strategies that PwC suggests to enhance root cause analysis is to leverage data analytics.
“Effectively leveraging advanced analytics and end-to-end root cause analysis allows retailers to assess, strategize, plan and deploy risk mitigation programs,” says Zawoyski.
Sources: National Retail Federation: STORES magazine, June 2016, PricewaterhouseCoopers
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