Warehouse and cargo theft creates substantial financial losses for companies, however many incidents are not formally reported. A study conducted in the USA has revealed that worldwide, losses have been estimated at 30 billion US$ a year and frequency is on the increase. Indirect costs, such as investigation and insurance payments, can cost between two and five times the cost of direct losses. As this type of crime may occur in any part of the supply chain process it is regarded as a supply chain crime.
Transportation companies and their warehouses experience the majority of all reported losses at 85%, followed by maritime, rail and air. Approximately 80% of cargo and warehouse thefts are committed by internal employees, or involve some internal involvement.
Pilferage is the most common form of theft. Most stolen cargo remains in the possession of those who stole it for less than 24 hours. Cargo theft is not considered to be a serious crime as it is typically a victimless crime; as such it usually does not carry severe sentencing.
Some tips on how you can try to make your warehouse and Distribution centre more secure and less appealing to the criminal elements.
Warehouse Personnel
· As the most senior employee, your warehouse manager should be your most trustworthy employee in the warehouse. Take the time to look for a suitable candidate
· Appoint trustworthy staff, since any theft prevention system will come to nothing if there are insincere individuals in your staff. Don’t assume the trustworthiness of an employee, do some background checks, or ask for references to confirm their integrity before hiring.
Disciplinary Action
· Do not let small thefts or minor cases of negligence pass without instigating investigation and warning the persons in charge. When you close your eyes to these small incidents of stealing, it will encourage others.
Access
· Setting access levels that reflect staff members’ roles can be used as a balancing measure to initial staff checks
· Do not have more entrances than the necessary ones, particularly near the receiving or shipping docks.
· The receiving dock and the shipping dock should not be too close together, there should be a barrier between them, otherwise it becomes easier to take things from one truck and put them into another.
· When using keys and locks, make it part of your warehouse security policy to limit the amount of keys in circulation. Unless employees are opening or locking up, access to the keys should be strictly documented. The more sets of keys flying around, the less your warehouse security gates will be viable and secure.
· Manage high cost inventory items accordingly; a more secure environment is required for high value items, this is not to say that all inventory should not be secured.
· Consider the use of electronic keys that can be swiped, rather than traditional keys. This will allow the warehouse manager to monitor who is accessing which area of the building, and when. They also can’t be duplicated, and can be deactivated if the key is lost or stolen.
· The ‘two-man rule’ ensures that at least two employees must be present when a locked cage or locked pallet racking area is being accessed - this is an option that can be implemented to further improve security.
· Limit the number of exterior doors that can be used to gain access by employees. Fit doors with a sensor that alerts management when they’re accidentally left open.
· Security mirrors can give the manager a clear view of the dock or the entrance from the rest of the building. People should not be able to sneak in and out of the warehouse without being seen.
· Limit how many people have access to the warehouse facility. It is important to have a policy about who can enter the warehouse and when, especially for outside personnel who are common visitors - typically delivery drivers.
· This staging area should not be too close to the loading docks. If no one is around to keep an eye out, it would be easy to take something and put it in a truck.
Pilferage
· Dustbins or other large containers, scrap skips, should not be placed near an accessible door. They can become ideal places for thieves to stow stolen inventory for later pickup and removal to cars. If you cannot position your dumpster in a way that discourages thievery, consider making it lockable so that access is difficult to unauthorized personnel, searching it frequently, and letting people know it is monitored.
· The parking area should not be too accessible to employees who might steal inventory. It's best to have parking separated by a comfortable distance from the warehouse doors, making it more difficult to transport pilfered items. Best case scenario is to have a fence separating the warehouse from the parking lot.
· Bushes, shrubbery and foliage are a good hiding spot for things stolen out of the warehouse, especially when they are near a door. Remove the bushes or lock the doors to curtail this avenue for thieves.
Alarms and Surveillance
· Alarms and some level of surveillance are a critical part of any warehouse. Fire alarms, motion sensor lights and alarms, and video monitoring devices are vital security features.
· 24/7 Offsite monitoring is beneficial as it removes the risk of recordings being tampered with and any meddling with cameras or surveillance equipment can be picked up immediately and the necessary steps taken.
· Conduct regular security audits to test the robustness of the site’s security features
· Windows should be barred and fitted with security alarms.
Inventory Management system
· A foolproof inventory control system is a must since any excessive inventory, which is not recorded, can incite ideas of embezzlement in a corrupt individual’s mind.
· Conduct spot-checking of inventory during security rounds/shifts
Don’t leave your company’s most major investment susceptible to plunder from a lack of attention to security matters.
Contributed by Tonya Lamb, Loggerhead Security and Investigation Services
