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Business Theft

Business theft - it couldn't possibly happen to your business. Could it? Chances may be greater than you think. Jack L. Hayes International, a leading loss prevention and inventory shrinkage control consulting firm, released a survey showing that over 530,000 people were apprehended for shoplifting and employee theft in 2006, recovering more than $116 million that would have been lost to business theft and fraud.

Those statistics only cover shoplifting and employee theft from 23 major retailers. If major retailers can be hit by theft, business fraud, and embezzlement despite their business security measures, theft becomes a very real risk small businesses need to consider.

Data TheftWhat are Business Theft and Fraud?
When you hear the words "business theft" or "business fraud," what do you think of? Armed robberies of a local convenience store? Kids shoplifting? Employee theft like the embezzlement of large sums of cash? The most obvious forms of business theft aren't always the most common forms, which is why loss prevention and theft protection practices need to vary greatly from business to business, or at least industry to industry.

Even if your business has no physical merchandise publicly available to customers, or no face-to-face cash transactions (meaning no cash on-hand in a cash register or safe that would attract robbers), you may be susceptible to other forms of business theft and fraud. In fact, even in the case of retail theft like shoplifting, the U.S. Small Business Administration (SBA) estimated in a 2008 report that two thirds of business thefts are employee thefts rather than thefts or fraud committed by outsiders.

  1. Retail Theft - Shoplifting
  2. Retail Theft - Under-Ringing Merchandise / "Sweethearting"
  3. Robberies
  4. Employee Theft - Embezzlement of Cash
  5. Employee Theft - Merchandise / Inventory
  6. Employee Theft - Supplies
  7. Employee Theft - Intellectual Property
  8. Identity Theft
  9. External Intellectual Property Theft

Business LossesHow Big of a Risk is Business Theft?
Are business theft and fraud really a big problem for small business owners? How much damage to the overall health of your business can fraud and theft really cause? According to a 2004 article in The Colorado Springs Business Journal theft and fraud can actually do quite a bit of damage - business theft takes around ten percent out of every sales dollar nationwide.

That doesn't mean ten cents are lost out of every dollar of profit. It means ten cents are lost out of every dollar of sales. Therefore, if your business does $10 million in sales throughout the year, on average your business will lose $1 million to business theft.

Now compare that total dollar value lost to your profit (likely significantly less than your total sales figures), and you'll form a better appreciation for the impact business theft can have on the small business owner.

Imagine an embezzlement case where an employee steals $1 million from your company. That might be easy to catch. Unfortunately, most business theft accumulates from smaller cases of theft and fraud (whether it's merchandise, cash from the till, or theft of supplies), and that theft can be harder to catch. Because many thefts and types of business fraud are difficult to catch (like smaller instances of retail theft), businesses often account for the expected losses by raising end prices to customers.

Between the basic dollar loss and the fact that businesses have to raise prices (making them less competitive), it's no wonder the SBA reported that nearly ten percent of businesses filing for bankruptcy cited a business calamity such as business theft or fraud as a cause of their financial difficulties. To make matters worse, not all business insurance covers losses resulting from business theft.

Protection BusinessTheft.com Has Your Business Covered
No matter what type of business you run, BusinessTheft.com is your premiere source of information on loss prevention and business theft protection. Arm yourself and your small business with the best information available to minimize your risk of employee theft, fraud, shoplifting, identity theft, intellectual property theft, retail theft, and more!

At BusinessTheft.com, you'll learn about:

  1. The employee screening process (employee background checks) to decrease employee theft.
  2. Business security and loss prevention measures you can implement right now to cut down on internal fraud and external retail theft like shoplifting.
  3. Theft protection through small business insurance.
  4. And more to help your business combat external as well as internal theft.

Learn how you can prevent business theft today!