21/11/2011

By Scott Thompson

The White Company reports a 38 per cent reduction to shrinkage levels and
associated sales uplift since investing in Nucleus IS-Stock Audit from
Zetes in March. It made the decision to implement Nucleus because stock audit integrity was becoming a problem for the business as were shrinkage levels of high value items.

Prior to that, the retailer outsourced its bi-annual stock auditing to a third party specialist. Whilst this strategy was acceptable when the retailer was much smaller, because audits were managed completely separately from the rest of the business, it was not possible to investigate issues quickly and store level accountability was low.

"We made a commercial decision not to continue with the original
outsourced model due to concerns that the integrity of third party stock
counts was having a detrimental effect on the business since it was so
detached from the rest of store operations," says Colin Blake, head of
loss prevention at The White Company. "It was clear we needed to bring
stock auditing in-house with specialist technology and expect to see
fantastic cost savings using Nucleus."

In addition to improving accuracy levels, in-house auditing is faster and
being directly involved with the process has made store management more
accountable because they are closer to the process. "It is always
difficult for retailers to weigh up the pros and cons of outsourcing stock
auditing to a third party because external auditors don't possess the same
level of product knowledge as an in-house sales team," says Andrew
Southgate, joint managing director at Zetes UK. "Using internal sales
staff means they spend slightly less time on the shop floor whilst the
process is underway, but accuracy is much higher because they know exactly
what to count and retailers can then benefit from the associated sales
uplift.

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