Source Tagging Equals Savings and Shrink Reduction for Best Buy

With operations in over 990 stores serviced daily by approximately 150,000 employees, Best Buy needed a loss prevention solution that would deliver the double S: Savings and Shrink reduction. As a multinational retailer Best Buy offers a diverse family of brands that have “grab and go” convenience customers have come to appreciate. For Best Buy the challenge becomes whether to openly merchandise items to maximize customer convenience and enhance profits versus locating items behind display cases to protect them from theft while inconveniencing the customer.

Their concept of having more products conveniently merchandised required the right anti-theft solution while maintaining a consistent customer shopping experience that Best Buy highly values. To improve operational efficiencies while limiting theft, Paul Stone, Vice President of Loss Prevention and Risk Management for Best Buy faced the challenge of researching the right EAS solution ideal for a store environment like Best Buy known for their wide variety of electronics.

Too much electronics “noise” found in their store setting impacted Radio Frequency (RF) performance; thus, Paul selected the Sensormatic Ultra•Post® as their theft deterrent system. With virtually no false alarms, the Ultra•Post® Acousto-Magnetic (AM) Technology offers superior detection performance with the Sensormatic patented resonator technology and new high coercivity bias to achieve high detection that is immune to detuning by such elements as metal, foil, liquids and magnetic fields – a must for the Best Buy electronic environment. Proven, reliable detection and system performance of Ultra•Post® supported Best Buy’s “grab and go” philosophy.

To increase product availability and achieve labor savings at the store level, Best Buy implemented Sensormatic source tagging (items source tagged at point of manufacture) into the LP program by identifying product categories that fit into their merchandising strategies. The program’s early stages targeted CD’s and DVD’s with an overall goal to source tag all entertainment media products 100%.

According to Mr. Stone, source-tagging not only offered Best Buy labor savings but also savings by eliminating the plastic keepers for CD, DVDs, video games, “Our process involved incorporating source tagging language into vendor master agreements, targeting merchant groups within Best Buy to promote source tagging and negotiating trade-offs with vendors.”

The implementation of source tagging resulted in significant sustained shrink reduction and also an increase in sales of both CDs and DVDs. Eliminating plastic keepers resulted in a win-win for Best Buy and the product vendor since source tagging offered more flexible product placement in an open merchandising environment convenient for customers.​

Filed under Loss Prevention; Acousto-Magnetic; Source TaggingKeywords electronic article surveillance; acousto-magnetic; EAS; loss prevention; shoplifting; shrink

Published on 10/18/2008 Permalink

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