Loss Prevention Works with DCs, Stores to Protect the Exchange Benefit

With Exchange warehouses and stores shipping significantly more merchandise bought online, loss prevention experts play important roles within the supply chain to ensure that customers receive deliveries as ordered.

Sixteen LP leaders—some new to their positions and Exchange warehouses—toured the Waco Distribution Center in Texas recently to learn how associates pick, pack and ship online orders using the most modern warehouse management technology.

They talked with associates about the root causes of loss and safety issues, and took that knowledge back to their Exchanges to serve as more checks-and-balances to make the ship-from-store program operate smoothly.

In addition, 47 loss prevention associates work at the Exchange’s 10 distribution centers to perform the same quality-assurance duties.

“We provide that extra set of eyes,” said Michael Jones, regional loss prevention manager at HQ in Dallas.

The Loss Prevention Directorate protects the Exchange benefit by not just focusing on shoplifting, but also on reducing on-the-job injuries that lead to higher healthcare costs, lower productivity and higher absenteeism. The directorate’s initiatives help increase earnings, and thus dividends for the military’s critical Quality-of-Life programs.

“Loss Prevention, whether in our stores or distribution centers, have one goal, and that is to reduce losses which in turn benefits customers,” Jones said.

LP’s efforts come at a time when the Exchange is more involved in online retailing than ever before.

Nearly 100 Exchanges around the world ship online orders directly, while the Buy Online, Pick Up in Store program has expanded to 135 stores.

The enormity of the Exchange’s online operations means that any errors could be costly.

If orders are missing items or contains a wrong product, fixing the error, reshipping the correct merchandise and restocking items would cost the Exchange. If these mistakes happen often, the costs add up quickly and could mean hundreds of thousands of dollars lost for the Exchange and fewer dividends for the military’s critical Quality-of-Life programs.

“With all the modern technology in our DCs, we are better equipped than ever to identify possible losses and errors,” Jones said. “We conduct spot checks at both the DCs and stores to ensure that packages have the right contents and that items are packaged and shipped accurately.”

LP experts also certify that the DCs are getting the proper number of laptops, big-screen TVs and other merchandise from vendors. If not, they investigate to find out where the products went missing.

As for customer orders that come up short, LP experts trace the movements of that order—when, where and by whom the orders were packed and whether quality-control steps were missed.

Waco DC Manager Preston Huddy said he’s thankful for Loss Prevention being in his warehouse.

“In my 32-plus years in logistics, the Loss Prevention team has always served as a partner,” Huddy said. “They remain a key ingredient in reducing loss and increasing the bottom line.”