Securing against theft - source tagging

Packaging Professional magazine
17 Jul 2009
Source tag

Securing products against theft during manufacture helps retain the integrity of a brand’s packaging. Source tagging is growing in importance due to its minimal effect on packaging, says Neil Matthews, Vice President and General Manager of North, Central and Eastern Europe
at Checkpoint Systems, UK.

Last year retail crime cost the UK £4.1bln, the highest figure in Europe, according to UK company Checkpoint Systems’ Global Retail Theft Barometer (GRTB). As products become more desirable and expensive, and consumerism continues to drive the need to have the latest designer clothes and gadgets, the temptation to shoplift is stronger than ever. This is especially the case as we head further into recession and disposable income decreases.

With so many channels to dispose of stolen items, there is now a greater incentive to steal and less fear of being caught.

All this demonstrates the vital need to protect products, especially as ones face growing pressure
to maximise and protect their profit margins. Astute retailers are investing in innovative technological advancements, such as source tagging, to ensure they are better prepared.

Source tagging is the process of applying a security label during manufacturing, so that items are
protected throughout the supply chain and are only deactivated at point-of-sale. This solves the issue of security for retailers and does not affect the product’s packaging.

Unlikely products such as cheese are increasingly going astray. Some stores are taking steps to combat this. A leading retailer started selling parmesan cheese in the tamper-proof plastic cases usually found on DVDs after more than 70% of its range of hard Parmigiano Reggiano was stolen.

Such cases take up valuable shelf space, affect the product’s appearance and may discourage purchase. Consquently some retailers are working with manufacturers to investigate ways to integrate anti-theft electronic article surveillance labels inside the vacuum shrink packaging used to protect cheese.

Retailers must carefully select from the array of technological solutions that promise to maximise the speed-to-shelf and security of products.

Paper-thin labels can be integrated virtually anywhere onto a product or within the packaging, and do not detract from the image or marketing messages. All too often, retail staff apply security tags in-store with no regard for where they are placed. This can cover-up legally required information, such as ingredient panels, as well as take up valuable staff selling time, delaying the speed-to-market and damaging brand integrity.

Picture this

The image of a product is at the heart of its appeal, with packaging a vital component in creating a winning brand. As such, a significant amount of time is invested in a brand’s packaging to ensure the colour, shape and information appeals to the target audience. Source tagging does not detract from this extensive investment and satisfies the retailer’s desire for stock protection.

The 2008 GRTB, commissioned by Checkpoint Systems and undertaken independently by the Centre for
Retail Research, Nottingham, UK, found that 7.9% of European retailers use source tagging, which was shown to effectively protect retail profits and the packaging image.

If the shoe fits

Realising the benefits of source tagging technology, RENO, part of the HR group (Europe’s second-largest shoe retailer), installed a source tagging programme in 700 of its branches across six counties. The Checkpoint NDRF (New Digital Radio Frequency) tagging system, with integrated customer frequency measurement, not only helped reduce losses but improved the customer shopping experience.

Hans-Werner Königs, Divisional Manager of Organisation and Goods Control at the company, says, ‘We recognised that there are advantages to effective tagging. After all, every item that is stolen has a direct effect on the company’s operating results.’

This has had a positive effect on RENO’s sales figures. Tags can be integrated into the shoes so that they can be displayed in pairs for customers to select themselves, as well as in boxes, without the danger of undetected theft. This means employees do not have to collect the second shoe from the stockroom, making the shopping experience faster and easier. The cashier deactivates
the tag to avoid triggering false alarms.