Crime Evidence Leverages RFID for Loss Prevention

By Claire Swedberg

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  • Sensormatic Solutions’ Shrink Analyzer solution is being adopted by retailers to identify and even build evidence around theft with RFID.
  • The technology can be used to identify and track the dollar value of goods being removed from a store, providing investigative support of local authorities.

Retailers face a persistent problem with theft and few easy answers. In 2021 the National Retail Foundation (NRF) estimated a year’s loss of $112 billion in goods. In some cases, organized crime networks have driven retailers and private-sector companies to capture evidence themselves and deliver it to law enforcement, to prove a crime and measure its magnitude.

RFID has become a key tool in the fight against shoplifting and shrinkage, by identifying items leaving the store, which can help to build a case related to what—and how much—was stolen.

Stores are testing or launching a solution from retail technology company Sensormatic Solutions as one tool in that effort, using both RFID and Electronic Article Surveillance (EAS), said Tony D’Onofrio, Sensormatic’s president. Sensormatic is a Johnson Controls company.

Sensormatic’s Hybrid Approach

Evidence collection is just one benefit to capturing the identity of items leaving the store—RFID technology helps stores manage trends in shrinkage, and ensure shelves are replenished. As more products are tagged with RFID labels, a growing number of retailers are leveraging the technology, often in conjunction with EAS and camera systems, said D’Onofrio.

Sensormatic’s Shrink Analyzer system offers a holistic approach to loss prevention to create a full picture of what is taking place at store exits.

One large unnamed retailer has been piloting the technology and is set to expand the deployment across more stores. Each pilot launched thus far is across multiple store locations, aggregating data from across the ecosystem to get a full picture of the shrink landscape and how to protect their stores, the technology company reported.

D’Onofrio’s Return to Sensormatic

“If you look at the retail industry, COVID accelerated some negative trends that were already underway in terms of crime getting a lot more aggressive,” said D’Onofrio, in his second stint with Sensormatic after several years in retail security consultancy.

In recent years, D’Onofrio noticed “retailers have been looking for technologies and I saw some interesting opportunities at the intersection of traditional EAS with RFID.” In 2023, he chose to return to the compnay to be part of a solution.

“I’m tired of hearing about organized retail crime. It’s time the good guys got organized and
actually went after retail crime ourselves, so that’s how we’re approaching this,”
said Tony D’Onofrio, Sensormatic’s president

In fact, some retailers have begun leveraging connected, RFID exit concepts to analyze what’s happening at the exit and comparing the items leaving the store against inventory that was sold.  By bringing RFID together with EAS, they have a full solution that acts as deterrence but also evidence.

EAS is a deterrence mechanism by sounding an alarm when an unpurchased item is being taken from the store, but it does not identify the product. RFID on the other hand, offers greater granularity of data in the form of a unique ID identifier. Since RFID reads can sometimes be thwarted by foil envelopes designed with shoplifting in mind, EAS provides redundancy.

Retailers Piloting and Deploying Shrink Analyzer

Additionally, Shrink Analyzer combines RFID data with video and software-based forensics aimed at supporting investigations.

By identifying each item that is removed from the store the retailer can correlate that information to the video image of that event. If an individual is walking out the door with an armload or basketful of goods, RFID enables identification of the items and their value, providing a retailer with the exact dollar amount of the theft.

That information can be used as evidence related to the magnitude of the steal. Often smaller thefts are rated as misdemeanors that are not investigated as intensively as a felony.

Sensormatic is now in discussion with multiple retailers regarding rolling out the Shrink Analyzer solution in their stores, according to company officials.

Meeting Crime with Multi-Pronged Approach

For technology companies and retailers, the effort is focused on staying ahead of the sophisticated crime networks.

“I’m tired of hearing about organized retail crime. It’s time the good guys got organized and actually went after retail crime ourselves, so that’s how we’re approaching this,” said D’Onofrio.

To that end, retailers have been sharing their RFID and video data with the local authorities after a theft-event in some cases. Because such crimes have become so commonplace, the assistance by retailers in the form of packaged evidence for police means offenders are more likely to be apprehended.

A multi-pronged approach is underway, including Sensormatic joining forces with retailers and NRF to lobby Congress for new laws specific to addressing retail thefts, including the Combatting Organized Retail Crime Act.

While RFID strengthens defense for retailers based on the granularity of information being captured, “ultimately it’s a people problem, and that’s why we also need better laws,” observed D’Onofrio.

Reader, Scanner in a Single Unit

The Sensormatic systems being deployed with Shrink Analyzer can come with both EAS scanner and alert as well as RFID reader and antenna.

Those using existing EAS pedestals can have them retrofitted with RFID tags attached to their merchandise at a relatively low cost. The TrueVUE Cloud technology from Sensormatic provides inventory management so that stores can view what products are onsite, which ones have been removed, and trigger a replenishment order so that the shelves are full.

“The unfortunate thing is that as we’ve gotten better at stopping the thieves, the thieves are getting more organized,” said D’Onofrio. That means finding ways to detune RFID reads when the tagged items come within range of the pedestal. Foil-lined bags are one tool used by shop lifters, for instance.

Gaining Inventory Insight

Because many brands are applying RFID tags to goods for supply chain visibility, retailers often find many of their goods are already tagged. But in some cases, retailers are applying RFID tags to their goods for their own inventory and loss prevention benefits.

When goods are tagged at source, stores don’t have to invest the labor to put the tags on their goods. D’Onofrio predicts that the rate of source-level tagging of goods with RFID is going to continue growing, making the process of adopting an RFID-based loss prevention system more seamless.

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