How to Spot & Prevent Warehouse Theft

Warehouse Theft

Businesses can suffer financially if their inventory starts to shrink unexplainably. However, a reduction in stock and inventory is often caused by internal theft in the workplace and it can be difficult to prevent this completely. Although, you’ll be able to protect your finances with the right tools and processes, usually through the fitting of CCTV and even asking employees to sign a code of conduct.

Despite the fact that it’s not entirely possible to mitigate the risk of employee theft, especially in and around a large, busy warehouse. But there are certain measures, processes and technologies you can put in place that’ll significantly reduce the risk of internal theft in the workplace.

How to spot employee theft in the warehouse

There are a fair few warning signs and red flags that can appear when employee theft is occurring. Where some are more obvious than others, we’re on hand to outline some of the most common signs alongside others that might not be as noticeable, including:

  • Stock levels aren’t matching up with your overall sales records
  • Sales records and numbers appear to dip on days when certain members of staff are on their shift
  • Rumours have started circulating around your employees that a member of staff is committing theft in the workplace
  • Particular employees might go to great lengths to avoid taking annual leave
  • Important documentation, such as receipts, invoices and certain records, are going missing or duplicates have been made
  • Stock is being found near exits, doorways and entrances on a regular basis, often in smaller, manageable piles

It can be extremely difficult to try and prove whether or not a member of staff is guilty of theft in the workplace unless you catch them red-handed or CCTV is in place to record the offence. But if you start to notice any of the aforementioned, then preventative measures and deterrents should be put in place immediately to try and curve the problem.

How to prevent employee theft in the warehouse

There are a number of things you can do to deter and prevent employee theft in your warehouse, regardless of its size or how many people you employ. Where many will instantly go and have CCTV installed throughout their premises, although this is an extremely effective tool, there are other things you can do to try and prevent your inventory from dwindling suspiciously.

Conduct background checks on prospective employees

Although this might seem like an obvious step, background checks aren’t often conducted by employers unless absolutely necessary. However, by carrying out these background checks, you’ll dramatically decrease the chances of your business falling victim to employee theft.

This is where you should look to draw on references and also find out whether or not they have a criminal record, generally for your own peace of mind. When asking references about the prospective employee, you should make an effort to ask them the following:

  • How long has the person in question worked for you?
  • Has the person in question decided to leave of their own accord, been made redundant or been dismissed?
  • Has the person in question been put on a disciplinary or been given a warning for anything?
  • Do you have any more information about why the person in question has decided to leave their employment with you?

Ensure you take some notes in order to make an informed decision further down the line. If you’re not sure about someone’s credibility, or if it’s been questioned in the past, then it’s advised that you don’t hire them.

Inform and remind employees about your company’s policy on theft

Make sure that all parties involved with the business, particularly your employees are aware that you take a zero-tolerance approach on theft in the workplace. For your peace of mind, you should request that they all sign a code of conduct that outlines the violation and how it’ll be dealt with.

In addition to that, you should look to provide a safe, confidential place for employees to report any activity that they may deem to be suspicious. Ensure that each report is dealt with seriously and immediately in order to confirm or deny the activity that’s allegedly taking place in your warehouse.

The aforementioned will also act as a deterrent for those who are looking to, are in the process of or have ever committed employee theft. If they know that other eyes are on them, looking out for suspicious movements, activities or practices, then they’ll be much less likely to try and steal something from your warehouse.

Deal with thefts as soon as they occur

If you’ve been experiencing a series of thefts in and around your premises, then look at your shift rota or register to try and determine who was on duty at the time of the alleged theft. If you start to notice a pattern between missing stock and those regular people who are on shift, look to monitor their activity from that point on. This will then allow you to investigate further and can be done in compliance with company policy.

Optimise managerial visibility throughout

Having a strong, continuous managerial presence throughout your warehouse will help to deter employees committing theft in the workplace. However, it can be quite difficult for managers to spend considerable amounts of time on the shop floor, especially if they have other duties that can only be done using a computer.

Therefore, it’s important that you look to invest in warehouse management solutions that’ll allow for managers to have more of a mobile presence where they can effortlessly transition from the office to the warehouse and this can include offering them a desk-free option.

There are several ways in which managers can benefit from this new way of working, including:

  • Being able to systematically record interactions with employees
  • Work can be reviewed by job function and the task or activity at hand
  • Tasks can be put on hold, re-prioritised and assigned with complete ease
  • Work can be forecast, planned and monitored in real time
  • The status of your customers and where products are in the process can be tracked

By giving all of these duties to your manager, this will subsequently increase visibility and general interactions throughout your warehouse which, in turn, will help to prevent employee theft in your warehouse.

Limit stock access as much as possible

Use the existing layout of your warehouse, no matter how big or small your premises might be, to create natural barriers and designated areas for your employees. If you haven’t already, perhaps look to separate your receiving docks and your shipping docks to help prevent any new stock disappearing before it even makes it into your facility.

Look to keep your picking areas and inventory storage apart from your shipping and receiving docks, because the only stock that should be going anywhere near your picking and inventory areas are both incoming and outgoing orders.

Ensure any visiting individuals, such as truck and lorry drivers, are given a separate seating area away from any of your stock, if possible. They’ll be able to wait in these areas while your employees load and/or unload any inventory going in or out of your warehouse. Only our workers should have access to your warehouse and any distribution areas.

Implement robust security systems throughout your warehouse

There are a number of different products and devices you can install throughout your warehouse to try and deter employee theft in the warehouse. Some of the items you’ll be able to benefit from include:

  • CCTV and security cameras
  • Dummy CCTV cameras
  • Motion-sensored lights in darker areas
  • Security mirrors

Among a number of security products you can fit throughout your premises, you may want to ensure that random walk-abouts are conducted by managerial staff. These only work if they’re completely unplanned and unpredictable as they’re designed specifically to catch thieves out, if there are any. Some of the areas you might want to focus on include:

  • Shipping bays
  • Receiving bays
  • Entrances
  • Exits
  • Inventory storage areas

If you have the budget, perhaps place security personnel on entrances and exits to keep an eye on any suspicious movement of goods or any attempts to conceal items in order to sneak them out of the premises. Vehicles should also be checked in order to spot any unauthorised stock leaving your facility. There shouldn’t be any private vehicles coming in the vicinity of your warehouse.

Try to understand any motivation to commit employee theft

Although this might be difficult for some warehouse owners to comprehend, there’s often some motivation or incentive for an employee to commit theft in the workplace. Understanding why theft in the warehouse occurs will enable you to deal with the situation more diplomatically and effectively. Some of those reasons could include:

  • Poverty – an employee could be struggling financially and may well take items for their family or to sell further down the line
  • Entitlement – some employees might think that the company owes them something and so they won’t think twice about taking the odd item every now and again
  • Opportunistic – staff have simple been presented with an opportunity to steal and it’ll often involve taking small items that might not be as noticeable when they disappear

Refurbished Forklifts are material handling specialists who are proud to supply customers with reliable, high-quality solutions that’ll stand the test of time. Our team of skilled engineers are dedicated to refurbishing forklifts and other warehouse machinery in order to suit every need and budget. If you’re looking to expand your fleet or if you simply wish to enhance productivity and efficiency throughout your warehouse, then get in touch with a member of our expert, knowledgeable team today – we’re always happy to help.

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