Guarding Your Inventory

It is likely your business had substantial physical inventory? How can you protect those assets?

Locks can keep honest people honest but even a good lock will not stop someone intent of steeling.  If you depend on locks alone you will need great insurance. We had a model home. It was the first home built in the subdivision so there were no homes nearby that were occupied. In the first few weeks we had the front door broken down, the lights on the outside of the house were stolen right off the wall and bushes were pulled out of the ground… and this was in a upscale neighborhood. We were able to install a webcam on a telephone pole across the street and post a sign warning about video surveillance. It either worked or the thieves got everything they wanted because the house was not broken into again.

Not all assets can be protected with locks. On our projects lumber was particularly easy to remove. It had numerous uses and was not job specific. It fit in every pickup truck on the job or that passed by. Even new homeowners that moved into the neighborhood could find uses for the product. We were losing hundreds of dollars of lumber on every house. 

It would have been impossible to lock up construction sites and installing a webcam for every new home would have been cost prohibited. To reduce the thefts we began ordering pre-assembled wall panels and roof trusses that were designed specifically for the job. We scheduled them to arrive the day they were installed so they were immediately built into the house and harder to steel.  It works so well for the lumber that we began ordering all our material just-in-time which means we scheduled it to arrive the day it was to be installed so that it went from the truck to being part of the house the same day. This was particularly effective for items that needed to be installed before the home could be locked up like windows and doors. On materials that took longer than a day to install such as siding we scheduled the delivery to arrive after the garage door was installed so we could lock the materials in the garage while they were being installed.

In the SCUBA shop we were losing small items to theft. Be relocating the small items closer to the cash register and installing a dummy camera we were able to all but eliminate the thefts.

If you look at your normal procedures you may find ways to protect your assets that cost little or nothing.  In the above cases not only did we protect our assets (lumbers, windows and doors) but we discovered by having them delivered just-in-time there was less unintentional damage and we improved cash flow. At the SCUBA shop we discovered that locating the small items by the cash register resulted in more impulse sales.

Identify problem areas then look at your procedures and see if there is a cost effective way to reduce of eliminate the problem.

Original Content copyright 2010 Thomas Robinson