Profit, in the broadest sense, is the difference between revenue and costs. But there’s more to consider when evaluating your business’ financial performance. Implementing smart loss prevention strategies can positively impact your bottom line with relatively minimal investment.
What is loss prevention?
Loss prevention encompasses practices aimed at minimizing a business’ losses due to theft, fraud, and operational errors. Its goal is to eliminate avoidable losses and protect profits. While primarily associated with retail, it is also applicable in other business settings.
Typically, loss prevention is seen as a cost to the business, because it involves expenditure – of time, energy, and sometimes money. However, loss prevention strategies that are carried out effectively and efficiently will not only protect your bottom line, but can help your business run more smoothly, too.
There’s a lot that can go into a business’ loss prevention program, and much will depend on your industry and size of operation. However, there are some universal features to consider. Here are five guidelines for loss prevention strategies that can help benefit your business:
Loss prevention strategies and tools
1. Guide employees
Employees who are properly informed of all hazards and properly trained on how to deal with them tend to be more efficient workers. They respond quickly to potential hazards and perform their work conscientiously, which adds up to increased profits by avoiding losses and increasing productivity.
If you don’t already have an employee training plan in place, it may be time to develop one. Take the time to consider what you need out of your staff and reciprocate with clear communication and respect. Employees, like any other group, tend to respond better when they’re treated well.
Basic employee responsibilities for loss prevention include:
- Think safety before starting any work
- Follow all loss prevention procedures, regulations, and rules
- Follow inspection guidelines for all equipment, machines, and tools
- Utilize proper personal protective equipment where required
- Operate all equipment with safety guards in place while in operation
- Operate only the equipment and machines trained and authorized to operate
- Report all unsafe acts, conditions and accidents immediately to management
- Participate actively in loss prevention training
- Suggest methods for control of workplace hazards
2. Provide opportunities
You’ll also want to provide your employees (and yourself) with opportunities to identify hazards through regular inspections, quality control programs, and procedures to handle deficiencies. The more often you devote time to careful assessment, the more likely you can avoid or reduce losses and maximize profits.
Not sure what you’re looking for? Consider calling on a risk management expert for some help and advice. Starting off your maintenance and inspection routines on the right foot can save you the time and stress that come with learning the hard way.
Take the time to consider what you need out of your staff and reciprocate with clear communication and respect. Employees, like any other group, tend to respond better when they’re treated well.
3. Focus on learning
Provide opportunities to learn from near misses, accidents without losses, and accidents involving losses to improve or create new loss prevention strategies. Despite your best efforts, you can’t always control outcomes; what you do in those situations can help your business perform better in the future.
Having a solid, up-to-date business continuity plan in place should be a top priority. After all, you have precious little time to react when you experience a cyber event, mechanical breakdown, or other catastrophe, and a written plan can mean the difference between total loss and swift recovery.
4. Share emergency procedures
Employees who are properly trained on emergency response procedures are excellent allies during an emergency. Their quick response could avoid or mitigate losses, protect assets, and ultimately save your bottom line.
An emergency contact list is at the heart of your emergency response plan. This will include a variety of contact information, from vendor phone numbers to crucial insurance details. You can get started on one for your company with the help of our emergency contact list template.
You have precious little time to react when you experience a cyber event, mechanical breakdown, or other catastrophe, and a written plan can mean the difference between total loss and swift recovery.
5. Ensure compliance
Complying with all safety legislation ensures that your dues are minimized, and helps you avoid any penalties or punitive damages for accidents. But basic compliance is also a good jumping off point for a best practices guide that’s tailored to the individual risks your business might be facing.
Purpose of loss prevention
Retail loss prevention involves identifying the causes of shrinkage and implementing solutions to address them. Businesses often enhance loss prevention efforts and boost profits by hiring a loss prevention manager or installing security cameras.
Loss prevention remains a challenge in both digital and retail arenas, facing threats from skilled cybercriminals to shoplifters targeting low-priced items. However, this is just one aspect of comprehensive loss prevention.
Ensure that your business is protected
Loss prevention is a team effort. When all levels of the company are involved in the creation, maintenance, and enforcement of your loss prevention strategies, there’s a better chance you won’t miss any crucial aspect or leave out a vital step. However, even though implementing loss prevention strategies will help with minimizing risks, things can still go wrong. To learn more about how insurance can help protect you, your business, your employees, and your bottom line, visit our Business Insurance page today!
