Technology Assessment Uncovers the True Cause of Inventory Discrepancies

A high-end specialty retailer with 40 stores in the US experienced consecutive inventory cycles with significant discrepancies. Initially, the organization believed theft was driving the inventory shrinkage. However, the store teams could not identify the source of their inventory losses despite having security measures and using AMZ Risk’s Threat Intelligence Monitoring to receive situational and tactical intelligence.

As an existing customer, the retailer understood the value and expertise AMZ Risk provides and reached out for help identifying the root cause of the inventory issues.

AMZ Risk worked with each technology vendor in question to update the system’s software and correctly program it to communicate with the other technologies. As part of this effort, store registers were connected to the camera system, so all POS transactions were captured on video, and easily available for research. Store teams were then trained on how to use each system effectively.

The true impact of the technology fixes was revealed within the first 6-month inventory cycle when the retailer saw a 35% reduction in shrink. In the second cycle, they saw an additional 20% reduction. The shrink reduction from both inventory cycles combined represented a positive profit impact of $675,000 for the year.