Theft Deterrence Marketing Part 1: The Big Picture

by Mark Manney
Posted On: 8/15/2019

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A major loss prevention strategy that I was taught, expanded and refined in big box retail with both dishonest employees and shoplifters, was the low-cost, high-impact, interconnected 'tactics' of deterring theft, fraud and business abuse that comes under the umbrella strategy:

Theft Deterrence Marketing (TDM)

TDM is a broad concept retailers have honed and refined over the generations. Almost every deterrence effort in loss prevention can come under it because it is just common sense interconnected tactics. More importantly it works!

To paraphrase an old truism: An ounce of prevention is worth a pound of expensive, stressful, and ugly investigation and confrontation cure.

Sophisticated retailers with in-house loss prevention divisions know they can deter most employees from bad behavior and stealing if they know what they are doing through TDM tactics that send a consent and a consistent message.

The message is simple:



To set the base line of who exactly in your employee pool I am talking about, let me go back to the three types of employees I presented in my last blog: The View Of Employee Theft From 30,000 Feet

How Many Employees Steal?

The breakdown is:

    Why Do Employees Steal?

    • 49% steal out of greed

    • 43% steal out of vindictiveness to get even for perceived poor treatment (perceived being the key word)

    • 8% steal out of need

    TDM works on the vast majority of the potentially dishonest…the 66%. That is a fact I have seen throughout my retail career and then in the well over 70 operations I have worked in -- in my vending, foodservice and micromarket career.

    Investigating, terminating and when appropriate prosecuting dishonest employees will occasionally be necessary (the 13% are, in a word, incorrigible) but it is also expensive, stressful and time consuming. Savvy business owners in every industry understand it is wise to "market" theft deterrence to your employees, just as you market your products or merchandise or services to your customers.

    There are four major TDM stages explained in this continuing TDM blog:

    1. HIRING/SCREENING -- Before they have touched the first dollar or case of product.

    See my past blog using TDM in your screening/hiring process.

    Back To The Future: Screening, Hiring And Avoiding Thieves, Slugs And Employees From Hell!

    1. A LOSS PREVENTION ORIENTATION -- All current employees and all new hires sit through a structured loss prevention orientation. Draw a line in the sand on theft and tell them! Talking about theft and that it is wrong and will not be tolerated is not to be underestimated in the impact of reducing it.

    1. A LOSS PREVENTION AWARENESS BULLETIN BOARD -- An ever changing "loss prevention awareness bulletin board" is posted. Don't underestimate the impact of this simple low-cost tactic.

    1. AN IN-HOUSE LOSS PREVENTION "CONFIDENTIAL HOTLINE" is set up -- Don't underestimate the impact of this simple low-cost tactic. More in a future blog.

    After you have relentlessly implemented TDM's major four interconnected tactics, their impact will become a blinding flash of the obvious as your cost of goods is steadily reduced and productivity steadily increases!

    Sound too good to be true? It's not and I have proven it in client after client after client who actually followed the program past just the "flavor of the month" soon-forgotten efforts many businesses put into a major "change" initiative. You have to stay with TDM quarter after year for the solutions to theft bleeding to become ingrained within your company culture, for TDM to mature into a "culture of controls." Remember this TDM can't just be a finger-wagging bluff. If you don't also put sharp teeth into a basic, simple, but real loss prevention investigation program it will all be for nothing.

    There is an old truism:

    "A barking dog who never bites…is soon ignored." Bluffs and barks will be eventually called and ignored, but real loss prevention action and capability will market and sell theft deterrence.

    Here is one real-world example, I have many dozens more exactly like it.

    I was hired to go into a vending company with four operations in two states. Their largest operation had suffered from chronic high unexplainable cash and product losses for a decade…in other words, chronic employee theft for 10 years. The owner would get mad, employees suspected of theft would be brought into an office and "pressured" or "chewed out" or occasionally one "managed out." The losses would drop, time would pass and the losses would creep back up and occasional big hits would happen, but rarely would anyone be actually exposed. The bleeding went on and on and on. I have heard this story from countless clients and it's was one of the major reasons I was hired.

    Here is what I did under the TDM banner with a follow-up basic, simple, in-house loss prevention program in a nutshell:

    1. Every employee sat through a structured loss prevention orientation with handouts. I'll explain the handouts in the next blog. All future new hires went through the same loss prevention orientation with turnover.

    A theft line in the sand was drawn and clearly communicated to all current and future employees.

    2. A "loss prevention awareness board" was created and kept fresh. I'll put a few sample postings at the end of this blog and go into more detail in the next blog.

    3. A basic Investigative program/team was established and led by one selected "strong" manager who was given a detailed manual to follow.

    · Two covert cameras were purchased and deployed.

    · Two real-time covert GPS units were purchased and deployed.

    · A pre- and post-machine and changer audit protocol was established and given as an orientation handout to all employees and posted, but more importantly it was used in the field along with the real-time GPS units.

    Yes…you tell them exactly how you will investigate and expose those who are gnawing on the hand that feeds them, and then you do it.

    Note: Employees are never told how many covert cameras and GPS systems are being deployed, but they are told they are being deployed. Show your determined hand…not the number of individual cards.

    4. All keys were collected unannounced, audited, locked down on locking key rings, and a bunch were removed as the unannounced audit proved there was no key control and many employees had keys they should not have had and management was completely unaware of who had what.

    Note: This was done at the mass orientations in a one-day unannounced blitzkrieg key-control move. Both done together are a powerful one: two physiological punches telling employees you mean business.

    The next full accounting month, the owner was stunned and he was also angry. The chronic decade-long cash losses had completely stopped overnight! All the thieves, whoever they really were, had stopped stealing.

    This was a second-generation owner in a company that offered a decent pay scale, good benefits, and treated its employees well. He was angry that it took this approach to stop the bleeding, but I told him this was not the cure it was really just the opening round in a never-ending fight.

    During the upcoming theft lull, the learning curve on deploying the covert camera units, the real-time covert GPS, and conducting pre- and post-machine and changer audits, was rounded by the strong manager and in this case, her two-person investigation team who were highly trusted and could keep their mouths shut. I told the owner theft will eventually start back up and it did in the middle of the second month. However, this time it stuck out like a sore, throbbing thumb. A route driver had a real-time GPS unit slapped on, the cameras deployed in likely machines on his route, pre- and post-audits were completed, and two weeks into this focused investigation on an "employee of interest." Hard evidence of cash theft was collected, documented, he was confronted, interrogated, confessed, and the police were called and charges pressed. He left the building in handcuffs.

    The next month, covert real-time GPS units proved indisputable evidence of chronic, usually daily, theft of time, up to three to four hours a day was documented against two longterm senior technicians. They were confronted, interrogated, confessed, and were both terminated. Years later, that operation was still functioning with both technicians long gone, saving both salaries, benefits, and the phony regular overtime that had been constant from both was exposed as the scam it was.

    This client became a real believer in TDM and its use. As the years went by, I would see the owner at events and he did a great job in keeping the TDM constant and consistent and their losses from theft low.

    Here are a few loss prevention awareness board postings. Hundreds of these are free on the Internet if you know where to look.


    Loss Prevention
    Awareness Board

    Facts About Employee Theft...

    Businesses lose 20% of every dollar to employee theft!
    American Society of Employers

    30% of corporate bankruptcies result from employee theft
    U.S. Chamber of Commerce

    The FBI calls employee theft the fastest-growing crime in America -- 55% of perpetrators of employee theft are managers
    American Society of Employers

    The Boston Globe and Denver Post report that "time theft" and loafing cost U.S. companies over $400 billion a year in lost productivity

    Pa. Deliveryman Gets Prison for Faking Robbery

    The Associated Press

    UNIONTOWN, Pa.-A former deliveryman for a western Pennsylvania vending company will spend three to six years in prison for faking a robbery and otherwise stealing about $9,400 from the company.

    Twenty-five-year-old Larry Knopsnider Jr., of Connellsville, told state police that a man jumped him and took his money bag on Dec. 23, 2008. Knopsnider worked for CRH Catering Co. at the time.

    After the robbery, the company assigned other drivers to Knopsnider's route and noticed they collected more money from 11 vending machines that Knopsnider had been servicing.

    Police eventually determined Knopsnider lied about the robbery and had also stolen money from machines on his route and taken other money from a company locker. He was sentenced Thursday.

    Full Service Vending

    Prosecutes Driver Turned Vending Thief

    Full Service Vending provided information to the police which led to the arrest of a route driver for theft.

    The driver was caught on covert surveillance video loading additional product during off hours and selling it to individuals who met him along the route on numerous occasions. The video also revealed that he was tampering with the lock to access secured product areas. The inventory shortages were first identified by the company's vending software. Then the surveillance system along with a covert GPS tracker in his vehicle provided the needed confirmation. The theft is estimated at approximately $3,000 per week.

    The driver was employed by Full Service Vending for over two years and was the company's highest commissioned driver. He is currently being held on $25,000 bail in the Morris County Jail. "He was a good route man and had a solid future with the company," said company president Moti Almakias in a prepared statement. "It saddens me greatly that someone would risk their livelihood, family and reputation in the name of greed." Full Service Vending is one of five divisions of the Full Service Foods Group along with Coffee Express, Café on the Go, Milk Express and Arctic Chill Ice Cream. Full Service Vending has been serving the corporate refreshment needs of New Jersey, New York, Pennsylvania and Connecticut since 1955.



    Police have arrested an employee of Dixie Riverside, a vending business located in Augusta, GA, accused of taking money while restocking vending machines, according to a report by The Augusta Chronicle.

    The owner of Dixie Riverside provided a list of over a dozen incidents of theft from the vending machine and of the driver putting money into his personal vehicle. The owner claims the driver admitted to stealing more than $5,000, according to the source.

    Next Blog: Theft Deterrence Marketing - Part 2, The Art and the Science of the Vending/Food Service Employee: Loss Prevention Orientation.

    >> MARK MANNEY is the founder and chief executive of Creedmore, NC-based Loss Prevention Results, focused on the vending and foodservice industry. Click here to purchase his "Food Service Manual: The 5 Loss Prevention Common Denominators" and his "Micromarket Loss Prevention Manual" at the Vending Times Bookstore. Coming soon will be Manney's 100-plus-page master "Vending Loss Prevention Manual: Creating a Vending Culture of Controls: Training, Technologies, Tools & Tactics.” Contact him at (919) 812-3602 or He enjoys hearing from VT readers.

    He enjoys hearing from VT readers.