Hot products seminar presentation adrian beck

Understanding and Identifying Hot Products: The Top 50

Background, Plans and VisionAdrian Beck, University of Leicester

Defining Hot Products

Defining Shrinkage Malicious and Non-malicious Known and Unknown Parameters of Loss Prevention Function

Understanding Shrinkage

intended sales income that was not and cannot be realised

Defining Hot Products

Measuring Shrinkage Total value? Percentage of retail turnover? Margin?

Why Margin Matters

Factors Low Margin Item

High Margin Item

Selling Price €10 €10

Number of Items Sold 100 100

Unit Cost €9 €1

Total Sales €1,000 €1,000

Shrinkage Rate (Units Lost)

10 10

Value of Shrinkage (at Cost)

€90 €10

Profit After Costs and Shrinkage

€10 €890

Percentage Profit 1% 89%

The ‘Hot’ Concept

Risk is not evenly distributed.

Crime hot spots

3% of locations in some cities account for 50% of recorded

crime

Products

Places

People

Processes People

Places

Products Processes

Value of Understanding the ‘Hot’ Concept

Avoids spreading valuable resources too

thinly

Focus on the vital few amongst the trivial

many

Rapid impact

Greatest return

Possible diffusion of benefits

Hot Products Example

Understanding Hot Products: The Rise of the Acronym

CRAVED AT CUT PRICES SERV

CRAVED

Concealable – easy to hide Removable – easy to get out of store Available – on open display Valuable – easy to sell on Enjoyable – high demand and reputation Disposable – good market for them

AT CUT PRICES

Affordable – easily purchased with cash Transportable – easy to move around Concealable – easy to hide Untraceable – few auditable markings Tradeable – easily exchanged for cash or other

commodities Profitable – have value Reputable – good brand placement Imperishable – long lasting Consumable – need to be replaced regularly Evaluable – quality can be verified Shiftable – regular market for items

Ability to Affect

Factors High Medium LowAffordable

Transportable

Concealable

Untraceable

Tradeable

Profitable

Reputable

Imperishable

Consumable

Evaluable

Shiftable

CRAVED AT CUT PRICES

Influencing Offender Decision Making

Increasing Risk What are the chances of being caught?

Reducing Reward What are the benefits?

Increase Consequences What will happen to me if I am caught?

Understanding the Dominance of the Malicious Agenda

Dominance of Security as Loss Prevention

Lack of Engagement with Known Losses Prioritisation by Technology Providers Planned Shrinkage Lack of Data

SERV – Non-malicious Shrinkage Sensitive to time – time limited Expectations of consumers – any

damage unacceptable Reprocessing – opportunity for error Vulnerability of packaging – likely to

generate damage

Hot Products Lists

Hugely Difficult Variance in Recording Variance in Categorisation Variance in Detail Variance in Definition Dominance of Lowest Common

Denominator

Methodology

Request to ECR Members for Information Limited Response – not willingness but ability Top 50 Items Across Agreed Categories

Food Beer, Wines and Spirits Health and Beauty

Limited to 3 UK Retailers: Supermarkets Combined 40.7% of Total Turnover Sales of €109.9 billion

Methodology

Normalisation of Categories Indexing of Data to Enable Parity in

Ranking Variance from Company Category Average Percentage of Sum Total of Combined

Variance: Risk Value All Data For 12 months – Previous Year Only Unknown Data Total of €72 million of losses – only top 50

items per retailer

Hot Product Categories

FoodBeers, Wines & SpiritsHealth & Beauty

0%

10%

20%

30%

40%

50%

60%

53%

33%

13%

Categories

Ris

k S

co

re

Food Categories

Fresh Meat

Meat Counter

Milk

Strawberries

Vegetables

Peppers

Leeks

Cheese

Fish

Potatoes

Eggs

Bananas

Bread

Drinks

Sandwiches

Other Berries

Fruit Other

Berries Other

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34

33.8

16.3

5.1

5.1

5.1

4.9

3.7

3.1

2.9

2.6

1.9

1.5

1.4

1.1

1.1

0.5

6.2

3.2

Risk Score

Ca

teg

ory

Food: Fresh Meat

Beef

Chicken

Lamb

Pork

Bacon

Turkey

0 5 10 15 20 25 30 35 40 45 50

46.2

25.4

12.8

9.5

3.6

2.6

Risk Score

Ca

teg

ory

BWS: Category Type

Branded Own0

10

20

30

40

50

60

70

80

90

100

97

3

Type of Category

Ris

k R

an

kin

g

BWS: Hot Categories

Spirit

Beer

Wine

Sparkling

Liqueur

0.00 5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00 45.00 50.00

49.86

25.10

14.45

8.71

1.87

Risk Ranking

Ca

teg

ory

BWS: Top 10 Brands

Jack Daniels

Smirnoff Red Label Vodka

Stella Artois

Moet et Chandon

Famous Grouse Whisky

Bacardi

Courvoisier VS Cognac

Carling Lager

Bells Whiskey

Wine

0.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00

11.27

9.54

7.26

5.19

5.05

4.15

4.08

3.87

3.11

14.87

Risk Ranking

Pro

du

cts

BWS: Specific Brands All

Smirnoff Red Label Vodka 1l

Jack Daniels 70cl

Jack Daniels 1l

Bells Whiskey 1l

Moët et Chandon Brut Impérial NV 75cl

Courvoisier VS Cognac 1l

Bacardi Superior Rum 1l

Carling Lager 15x440

Stella Artois 18x284

Carling Lager 24x440

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0

7.4

6.7

4.6

3.1

3.0

2.7

2.5

2.4

2.2

1.9

Risk Rating

Sp

ecifi

c B

ran

d

BWS: Specific Spirit Brands

Smirnoff Red Label Vodka 1l

Jack Daniels 70cl

Jack Daniels 1l

Bells Whiskey 1l

Courvoisier VS Cognac 1l

Bacardi Superior Rum 1l

The Famous Grouse Scotch Whisky 1l

Martell VS Cognac 70cl

Smirnoff Red Label Vodka 70cl

High Commissioner Whisky 70cl

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0

14.8

13.5

9.2

6.2

5.4

5.0

3.9

3.5

3.5

2.9

Risk Rating

Sp

irit

Ca

teg

ory

BWS: Specific Beer Brands

Carling Lager 15x440

Stella Artois 18x284

Carling Lager 24x440

Fosters Lager 15x440

Stella Artois 20x440

Budweiser 20x330

Carlsberg 24x440

Carlsberg Lager 15x440

Fosters Lager 24x440

Own Brand Lager 12x440

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0

9.6

8.8

7.4

6.9

5.8

5.5

4.1

3.6

3.3

3.3

Risk Rating

Be

er

Ca

teg

ory

BWS: Specific Wine Brands

Ogio Pinot Grigio 70cl

Villa de Moreschi Pinot Grigio 75cl

Oceans Edge Sauvignon Blanc 70cl

McGuigan Estate Shiraz 75cl

Via Vecc Pi Grigio 70cl

Blossom Hill White Zinfandel 70cl

Lindemans Sydney Cove Red 70cl

Lindemans Sydney Cove Chardonnay 70cl

Dion Pinot Grigio 70cl

McGuigan Estate Chardonnay 75cl

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0

7.7

5.3

5.3

5.3

4.8

4.8

4.3

4.3

4.3

3.8

Risk Rating

Win

e C

ate

go

ry

BWS: Manufacturers

Diageo

Brown Forman

InBev

LVMH

The Edrington Group

Coors

Bacardi

Fortune Brands

Own Brand

0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0

15.7

12.6

9.7

6.6

5.0

4.3

4.1

4.1

3.7

Risk Rating

Ma

nu

factu

rers

Health & Beauty: Top 10 Type

Health GroomingPain Relief Baby CosmeticOral Health Beauty Perfume0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

30

22

12 11

97

5 5

Type

Ris

k R

ati

ng

CreamsShampoo

BladesSprays

RemediesSun

creamTesters

Toothpaste

BrushesMascaras

Baby FoodWipes

Nappies

Health & Beauty: Top 10 Brand

Fusio

n

Nurof

en

Max

Fac

tor M

asca

ra

SMA B

aby Fo

odLy

nx

Oral B

Arman

i

Mac

h 3

Dulco

lax

Cow &

Gat

e Bab

y Fo

od0

2

4

6

8

10

12 11

9

5 4 4 4 4 43 3

Brand

Ris

k R

ati

ng

Health and Beauty: Specific Brands

Gillette Fusion Power 8 Pack

Gillette Fusion Blades Manual 8 Pack

Dulcolax x40

Max Factor False Lash Effect Mascara Black

Lynx Bodyspray Africa 150ml

Anadin Extra x16

Gillette Fusion Power 4 Pack

Gillette Mach 3 Blades 8 Pack

Nurofen Express Liquid Capsules x16

Rimmel Volume Flash Mascara

0 1 2 3 4

4

3

3

2

2

2

2

2

2

2

Risk Rating

Sp

ecifi

c B

ran

d

Health & Beauty: Top 10 Manufacturer

P&G

Reckit

t Ben

ckise

r

Glaxo

Smith

Kline

Pfize

r

Unileve

r

Boehr

inge

r Ing

elhe

im

Max

Fac

tor

Arman

i

Nutric

ia Ltd

Max

imus

cle0.00

5.00

10.00

15.00

20.00

25.00 24

12

7 6 65 5 4 3 3

Manufacturer

Ris

k R

ati

ng

Health & Beauty: By Category

Fusion

Lynx

Mach

3Su

re

Quattr

o Ti

tani

um B

lade

s0

1020304050

50

20 1810

2

Grooming

Brand

Ris

k R

ati

ng

Dulco

lax

Cyclo

ne

Optre

x

Zovira

x

Durex

Zanta

c

Niqui

tine

Adios

Clear

blue

Seno

kot

0

2

4

6

8

10

12 1110

77 6 6 6

5 5 5

Health

Brand

Ris

k R

ati

ng

Health & Beauty: By Category

Nurofen Anadin Panadol0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

78

17

5

Pain Relief

Brand

Ris

k R

ati

ng

SMA B

aby

Food

Cow &

Gat

e Bab

y Fo

od

Own Bra

nd B

aby

Wip

es

John

sons

Wip

es

Pam

pers

Huggi

es N

appi

es

Own Bra

nd N

appi

es0

10

20

30

40

40

28

10 95 4 4

Baby

Brand

Ris

k R

ati

ng

Health & Beauty: By Category

Max Factor Mascara

Rimmel Mascara Loreal Mascara0

10

20

30

40

50

60 53

32

16

Cosmetic

Brand

Ris

k R

ati

ng

Oral B Colgate Toothpaste

Blanx Toothpaste

Pulsar 35 Toothbrush

0

10

20

30

40

50

6058

29

6 6

Oral Health

Brand

Ris

k R

ati

ng

Health & Beauty: By Category

Armani Boss In Motion Jean Paul Gautiere0

10

20

30

40

50

60

70

80

90

Perfume

Brand

Ris

k R

ati

ng

Olay Bio-Oil Sally Hansen

Simple Kind

Pantene NFM Skin

Essence

0

5

10

15

20

25

30

35

Beauty

Brand

Ris

k R

ati

ng

Conclusions

Note of Caution Difficulty of standardising and normalising

data More clarity required on categorisation

Need for a broader range of companies

Watch out for Smirnoff vodka drinking beef eaters who like shaving and have a

headache!