With an ongoing business enterprise, there are always going to be challenges in developing and retaining talent that manage and service the customers of the business. Some would argue that the single most crucial component of a successful business operation is that the entire team is pulling in the same direction and, above all, protecting the brand that provides their income. The hardest thing I encountered as a loss prevention director was realizing that our guard had to be continuously maintained, during customer transactions and particularly during audits.
In the case of Pawn and Loan, some particular employee concerns should be pointed out. The critical thing to remember is that a pawn store employee’s routine involves acting as a retail sales clerk, conducting value appraisals on a wide assortment of items and being a character judge and capable loan officer. While this multitasking can be applauded for these folks, it also offers its share of risk to the organization.
In my years of managing audit protocols in pawn shops, including over 1,000 shops spread out globally for a national brand, we found some particular and equally tricky crimes to detect against our brand. I identified the most common and least detectable shrink issues that we were challenged with below.
Folks say that the pawn industry is financially fluid and highly profitable because of the inflated interest we realize on fully collateralized loans. The truth that they do not know is there is a calculated amount of shrink (or loss) that is calculated in to each store. How you or your audit manager monitors the mysterious ways store clerks take hard earned value from your organization can be the single most important operational process you have. I urge you all to take nothing for granted when it comes to ways your profits can drift away. The devil is always in the details.