A common misconception a business owner might have is that cash is the asset that is most susceptible to misuse by his/her employees. However, in many cases, it might actually be easier for employees to steal inventory, which then can be converted to cash.
For a manufacturer/distributor, inventory tends to be the company's most significant asset. During an economic recession, particularly when an employee's hours or wages have been cut, the risk of theft often increases.
So, what can you do to minimize your risk of employee inventory theft? You can deter this type of theft in a number of ways, including:
· Performing periodic inventory counts
· Installing adequate security cameras
· Limiting access to warehouse trash
· Designing effective internal controls for your receiving/shipping processes and perpetual inventory system
· Limiting the number of useable warehouse doors
· Positioning employee parking lots to limit access to the inventory and undetected incidences of theft
There are additional deterrents for manufacturers/distributors to consider; however, these are just a few of the best practices that we have found to be most successful for our clients. In conclusion, always remember - particularly during this holiday season - to be conscious of the times and keep your inventory safe.
