Cognizant 2020 InsightsExecutive Summaryrf n tbn129 ID: 168480
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Strategies to Mitigate Shrink in a Boundary-less Retail World Shrink is a constant, multi-faceted challenge that retailers must overcome to grow and prosper amid continuous omni-channel expansion. Cognizant 20-20 InsightsExecutive Summary \r \f \n \t \b \n ˜ ’ ˜•˜ Loss Prevention: A Constant Struggle to Protect Pro ts „… \rŽ \r \r \f … \f œ „ \r \f ž Ÿ\r ” ¡ \r \f \n \r\f \f \n \f\t \f \b\n ” \n „… \n ‹Œ \r \n \n \r \n – \r \n \r \n \r \f ˆ „… \n \r \n \f \f \f \n\n \r \n \n ’ \f \r \n \n\f\f \n \n ‰ \r ’ \f \f \n \f ¢‰ €€£ \n \n \r \r \r „\r \r ‹¤ \r \n \f \n ˆ „… \n ‚ \n \n „… \n ‹œ ‹‹ \r ’ \r \n Š\f \f ”‚ „… \n \r \n \f \r \n ƒ‰…† \r ˆ \r \r ƒŠ€† \n \f \n \f ƒ “ ˜ ˆ † Ÿ ˜ \n ‰… \n \n \f \r \r ’ \n ˆ • U.S. Shrink Could Reach $80 Billion \n • \r \r $3B $4B$6B$9B$15B$22B$30B1.8%$29B$36B$44B $46B1.4%$63B$78B01,0002,0003,0004,0005,0006,00019601970198019902000201020202030U.S. Retail Sales (in billions USD)**YearRegional and National Chains EraOmni-channel Retailing EraShrink in billions, shrink percent* While shrink as a percent of sales has remained relatively consistent over the past decade, shrink dollars are predicted to grow at an explosive rate unless a multi-faceted strategy is devised and implemented across the retail value chain.Shrink dollars began to grow with the onset of big box retailing, complex supply chains, a large workforce, organized retail crime and lack of retailers’ ability to take bold steps.Shrink dollars were small, with simple store formats.Independent Stores Era Ž ¥ \n ¦ ” \f \f “ ¦\f\n ˜˜ ¥¥” \n € Ÿ “ \b \n \n \r \f \n ‘ \f „… ‡ ˆ • ¢‰ \f — \r\f \r Challenges and Opportunities §\r \f „… \f \n €\n \f \f \f „… \n \r \r \n \n \n \n \n ‘ \f \r• \r \n\f ˆ \r \n “ \b ƒ ˆ † \f \n \r \r \n \n Loss Prevention Beyond Boundaries \n \b \b \r \n \n\f \n\f \r \f ‚\f ’ \n ƒ‚”€† \f \r ‚ \n \n \n \f \n ˆ \n \n \n ‚”€ \n \n ” \r \n \r \r \r \n \n \f •\n ‘ \f \r \n \n \n \n \f ” ‚”€ \n\n — \r \n \r \n\n \n\n \n \r \n \f Data Convergence and Advanced Analytics \n €\r \n \b\n \b \n \r\n\n \n\b\n „\n \n \n \n \n \f „… \n ” \n \f \n \n \n ‰\f \f \n \n \r „… ’ ” \f \r \f — \r\f ˆ A Coordinated Response to the Shrink Challenge Collaboration is a key theme to shaping LPCross-functional/Inter-departmental Collaboration Collaborating with other departments within the organization Product placement strategy LP case management software Collaborating with law officers Source tagging Direct store delivery (DSD) Scan-based trade (SBT)Retailer and Vendor/Supplier CollaborationRetailer/Technology Collaboration POS transaction monitoring Digital recording EAS (electronic article surveillance) “ ˜ š \r \r \r \r ’ • \n \n \r \r \n \f \r \r ‰ \n• \n \n ‘ \n \n \f \r \n \f \f • • \n „… €\n \r ‡ \n \f \f Ÿ \n \n \n \n \f \r \n ’ \f “ ˆ\n ’ \f \n €€£ \r \n \n \n \n Video Analytics‚ \n €\r \n \b\n ƒƒ„… \f \n \n \f \f \r\n £ \f \n \n\f \f \r \n\f \n \n \f £ \r \f \n • Ÿ \n \f \n\f\n \f \n \n ‰\f \n \f \f \n \f \r \n \f \f \f \r \n \n \n \n \f \f \f\r \n \f “ \n \f ˆ \f \r §\f \n \r \f ” \f \n \n \r \n \t ¦\r \n \f \n\f Exploring Thematic Intersections Data nalyticsidenalyticsLP BeyondoundarieFID “ \bBy monitoring activities such as cash movement, retailers can use video analytics to reduce shrink resulting from employee collusion. \f \n \n \f €€£ … \n \f • \n £ \n\f \f \r \r \n \n \n ¨” \n \n \r \r \r \f \f \r \f \n \n \f \n \f \r \n ‡ \n ‘ \n \n ‘ \f \n \r \f \n Omni-channel and Mobility Focus €\r \n †‡„\f ˆ \b \n \n\b\n ‘ \f \f \r \r \f ‚\n • • \f © © \r “ \n \n \n \r ‘ \n \n\n „… \n \r \r \f \f Ÿ \f \r \r \n\n „… \n \n\f \n • “ ˆ\n \r \n …‚ \f \n \r ª ‘ \n \n \nª Š \n \f ª ¨\r \n\f \f ª \n \n \n \n \n\f \n ˆ Ÿ \r \n \f ˆ\n \n \n ’ ‚ \n\n \n \n \r \n \r \r §\f \n • \r ‡ \n ˆ\n \f\r \n\r ‘ \r ˆ \f RFID Tagging ‰ \n‰\b\b\n \n \f \f \n\n \n \rŠŠ€\n‹‡Œ \n \f \n \n \f \n\nŽŠ€”“ Š \n \n\f \n \n ”“ Š \n • ”“ Š ˆ \n \n\t \n \r \rŽ \n ¢‰ \n ”“ Š \n •\f \r ˆ ¨\r\f ž \f¡ \r \f ”“ Š \n ƒ “ š ˆ † ¢‰ \n \f — \r\f \r ”“ Š ¢‰ \n \f \r \n ” \f \r \n \n – ‡ — ”“ Š \f \n \n ‡ \n \n \r \n • \n ‰ £ „” \n•\f ”“ Š \f \f \f ‹‹ Item-level RFID tagging is proving to deliver product inventory data that is up to 99.5% accurate. 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