Global Loss Prevention – 2011 Review

As we close out last year and move onto the future, it is natural to reflect on what we’ve learned and where we have been in 2011. This post will focus on the growing attention that international issues are garnering from Loss Prevention and security professionals.

The Global Retail Environment

Over the past year, we’ve seen the international retail market take center stage for many retailers, sometimes for the good and sometimes for the bad. Across the globe, retailers are announcing that international expansion is their growth market. Nowhere is this trend more pronounced than in the specialty apparel segment of our business. A&F, American Eagle, Gap, Uniqlo, and many others have announced their intentions for greater concentration and focus away from their home bases. In fact, there was speculation that Motherhood Maternity, a UK-based organization, might close their UK stores to focus on international opportunities, although this seems unlikely.

Yet, there have been plenty of retrenchments and pullbacks along the way. Leading brands such as Best Buy, Wal-Mart, A&F, and many others have reported less than expected earnings or even had to pull back from underperforming markets. Retailers have found operating expenses much higher than expected, infrastructure severely lacking, consumer acceptance not guaranteed, and, in some markets, political environments and corruption issues more challenging than initially estimated.

In recent months, many companies – retail or not – have curtailed or scaled back plans for Europe given uncertainty about the future of the Eurozone. For CFO’s of companies operating in the Eurozone, the fourth quarter found most of them grappling with contingency plans for what to do if the Euro starts to unravel over the next year.

Retail Loss Prevention Challenges – 2011 Recap

As retailers expand internationally, Loss Prevention executives are challenged to learn the different challenges, cultural influences, regulatory differences, training and learning orientations, and communication styles of vastly different markets and audiences. Privacy laws in the EU, works councils in Germany, corruption in Russia and former Soviet states, local politics in China, and violent crime in Central and South America all present challenges to our goals.

In the past year, we had the privilege of working with retailers around the globe and had many opportunities to meet, network, and travel around the globe.

  • In January, we were in Bogota with a client doing market assessment and FCPA training.
  • In May, we were back in Europe meeting with clients and gauging recent developments. I was able to avoid any volcanic disruptions this year and also got to spend some valuable time in Paris with Bernard Geiben, our Senior Consultant for international issues. With his in-depth experience in over 30 countries, he is a critical part of our global strategy and able to bring our clients real-world insights into operating in differing cultural and regulatory environments.
  • In July, I was in Mexico City with a key client and also had the chance to participate in the CSO Roundtable meeting held there to discuss current status/trends in the security environment in Mexico and Central America – a key concern to any retailer operating there.
  • In late August, I was able to spend some time in Shanghai and Beijing networking with both loss prevention and business contacts. One of the highlights was reconnecting with a good friend who grew up in China and is now relocating to Shanghai. Due to his extensive experience in China, he has an amazing network of expatriate friends who have been operating in China for years. Senior executives from companies such as Intel, Ogilvy PR, and other leading companies were able to share some of their insights with me. My favorite quote from the trip came from one of them, “Spend a week in China and you’ll want to write a book about it. Spend two months in China and you might want to write a column. Stay for a year or more in China and you’ll realize you know nothing about China.” Good advice.
  • September brought me back to London and Paris. While most of the trip was pleasure, I did get to connect with some US executives who were over to do some assessment and we had a chance to break bread together and compare notes.
  • In October, I was able to get back to Madrid for the ASIS Spain Chapter’s retail loss prevention seminar, “Encuentro profesional de la Seguridad en la Distribucion.” PCG’s Bernard Geiben was a featured presenter and we had an opportunity to network with several leading retailers including executives from Carrefour Spain and DIA. Plus, I got a side-trip to Barcelona to catch some world class football at Camp Nou.
  • In November, I finished the year in Washington, D.C. at the Control Risk Seminar, “Risk and Reward: Successfully Navigating an Unstable World.”

Looking Forward to 2012

In the coming year, all of us will have to become more knowledgeable about the challenges of taking what we do across the globe. In the first four months of the new year, we already have plans to be in China, South Africa, and the United Kingdom. This, of course, is in addition to meeting with companies around the US to hear about their lessons learned, their challenges, and how they have found ways to be successful in new markets. We hope to see you on our travels and good luck with your global ambitions!

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