Theft is the 32-billion-dollar problem everyone is trying to address in the business world. Aside from the immediate effect of a sudden drop in revenue, theft can cost a company its reputation, its culture, and even its very existence as it attempts to control the damage. As you look through the causes, you’ll find many publications pointing the finger almost exclusively at shoplifting, making businesses often believe that this is the only major threat they should be prepared for. However, digging a little deeper shows a myriad of problems that plague new and especially small entrepreneurs with regards to theft. Some of them are more impactful than others, but all of them translate to lost revenue and customer trust.
While the above three are discussed to no end and extensively studied by at least one independent institution in an OECD country, the same cannot be said about burglary. Despite the minimal amount of data collected about it (home and business burglaries are usually lumped into the same category in crime statistics), the phenomenon should be taken seriously since the effect of one single incident is devastating especially for small businesses. The misconception that burglary only happens to retailers is also harmful, since every business has something of value that can be robbed and more enterprising individuals would see the resulting complacency as an opportunity to enter more loosely guarded targets.
Combating burglary requires a two-pronged solution. Stow away anything valuable and make it difficult to locate and access wherever possible. This makes burglaries more difficult to execute. The second part of this solution involves getting an intelligent alarm system. Sophisticated burglaries will cut off power and communications from the premises before attempting entry so that any alarm with monitoring services cannot “call home”. You can stay one step ahead by getting a completely wireless burglar alarm such as the one that SimpliSafe offers. If you want to go further than that, install an outdoor motion-activated halogen floodlight. Make sure both are not easily reached. Keeping the front entrance to the premises well-lit discourages break-ins since it raises the risk of being in plain view of witnesses. Video verification, is also a new technology that is slated to solve just that, as SimpliSafe CEO, Chad Laurans advises on his recent Forbes interview.
When thinking of the people most likely to steal something from your place of business, you’ll likely imagine your customers trying something shifty. The people who show up day-in, day-out to work for you are less likely to ring any alarm bells in your mind. And it is for this very reason that you should be vigilant of the possibility of betrayal, even if you have the nicest employees in the world. It hurts to say this, but there’s always the possibility that a bad apple is sitting right next to you, hoping you are oblivious to the fact that they just took a little something from the counter.
To combat this threat without making your employees uncomfortable or transforming the workplace into a hostile environment, apply subtle prevention methods such as thorough vetting (including simple background checks) and surveillance near anything valuable. A little goes a long way in making sure that you suffer no major loss.
Unlike shoplifting and employee theft which mostly affects retail businesses, embezzlement is a pan-industrial phenomenon. Anyone with access to your books can steal from you and disguise it as a legitimate set of transactions. Even small-scale embezzlement can have a significant effect on your efficiency. This also happens to be one of the toughest forms of theft to act against. It’s difficult to tell whether you overpaid just a little for something or somehow made an invoice that just fell through at some point. People experienced at this don’t give themselves away very easily, at least not at the beginning. Since greed is a universal vice, anyone doing this will eventually cash in something too large not to notice. But as time passes, you’re still losing a growing amount of capital.
Stopping embezzlement is harder than preventing it, so the latter will probably be your best bet to ensure you don’t suffer this kind of threat. Run thorough and redundant background checks on everyone who can lay a finger on your spreadsheets. Everything has to be sanitized and looked over. Once in awhile, you should have a third party give your finances a thorough checkup. The very idea that you guard these things so closely will make people have second thoughts about slipping in some false transactions.
The internet is like a world inside another world. There’s the physical realm, and then there’s this weird plane of existence where apparently cats are celebrities and lots of mysteries stay hidden from view. One of those mysteries is your data, and it should stay hidden. Unfortunately, that’s not always the case. We call that a data breach.
When hackers gain access to your data, they effectively commandeer every digital aspect of your business. This could be limited to information about the company and its employees or it could have far-reaching consequences if customer data is also stored there (as was the case with Target back in 2013). Even if a breach results in no financial loss to you, you’ll still lose the trust of your customers.
To combat this threat (which, by the way, costs around $4 million on average), you’re going to have to start ensuring that all of your data is encrypted and that you regularly air-gap your storage. After that, you need to teach employees to be prudent, establishing an encryption and data use policy. A lot of data can leak out of your company if you have it floating around unencrypted in people’s smartphones or personal Dropbox accounts. Use a single sign-on service to make sure that your employees aren’t suffering from password fatigue.
It’s easy to associate protection against theft with protection against shoplifting, but that doesn’t stop your business from experiencing some of the most damaging threats it may face. You need to develop a multi-faceted approach to security both on-premise and in the vast reaches of the internet. Failure to do so exposes you to attacks that can kill a small business overnight.