Nearly 50% of retail loss prevention professionals are getting bigger budgets to help quell fraud, according to a report released by the National Retail Federation earlier this month.
44.5% of loss prevention professionals surveyed said their budgets for loss prevention efforts are increasing, and 68.2% say they’ll allocate additional resources to stop fraud, most of that in technology. About one in three (28.6%) surveyed professionals say they will add staff resources—and are looking for professionals with analytical, cybersecurity and investigative skills, the NRF says.
“As retailers grow their loss prevention teams, they are looking to add new skillsets that better equip them to face the changes in the risk environment,” the report notes. “Analytical skills were identified as the most needed, with more than six in 10 retailers saying it is needed for the loss prevention department to be successful or grow. Cybersecurity is the second greatest need, with four in 10 retailers needing to increase those skills.”
The 2019 National Retail Security Survey was conducted online Feb. 27-March 29, 2019, among retail industry loss prevention and asset protection professionals at 63 retailers. Participants were asked about their company’s loss prevention performance and actions in the 2018 fiscal year. Additionally, several companies participated in the survey on behalf of individual brands within their portfolios, the NRF says.
The survey covers both store and online fraud. In fact, when asked where retailers noticed the greatest increase in fraud occurring, in-store sales lead. 42.9% of respondents said in-store sales, 30.2% online sales and 22.2% said multichannel sales, such as buy online pick up in store.
When it comes to preventing ecommerce crime specifically, 17.5% of all merchants polled said it is much more of a priority than it was five years ago and 47.6% said somewhat more. Among retailers with 500 or fewer stores, 16.7% said stopping ecommerce fraud is much more important and 46.7% said somewhat more important. Of retailers with more than 500 stores, 30.3% said it is much more important and 33.3% said somewhat more important.
For cyber-related incidents, such as data breaches, 25.4% of all merchants polled said stopping such incidents is much more of a priority than it was five years ago and 42.9% said somewhat more. Of those with 500 or fewer stores, 26.7% said quelling data-related incidents is much more of a priority and 46.7% somewhat more of one. And for retailers with more than 500 stores 18.2% said its is much more important and 48.5%, somewhat more.
For return fraud, including from buy online pick up in store, 12.7% of all retailers said preventing it is much more of a priority than it was five years ago and 38.1% said somewhat more. Of those with 500 or fewer stores 6.7% said stopping it is much more important and 33.3% somewhat more. And for retailers with more than 500 stores, 18.2% said stopping return fraud is much more of a priority and 42.4% said somewhat more.
“Today’s loss prevention professional has more challenges than ever before, with threats online and in-store and from internal and external sources,” the report notes. “One bright spot is the increased investment in resources, including staffing and technology. Still, departments are looking for additional talent with the need for more sophisticated skills.”