Currency Control at Checkout
As the economy plummets, crime rises. Not every statistic supports that statement, but a story in The New York Times on Oct. 9 charted the correlation between rising unemployment rates and comparable increases in crime.
In the story, Richard Rosenfeld, a sociologist at the University of Missouri-St. Louis, stated: “Every recession since the late ‘50s has been associated with an increase in crime and, in particular, property crime and robbery, which would be most responsive to changes in economic conditions. Typically, there is a year lag between the economic change and crime rates.”
If his assessment proves accurate, crime is going to escalate very soon—if not this month, certainly in the first quarter of 2009, and in-store robbery will likely be a critical point of retail vulnerability.
Safe to say, the cash registers in your stores may not be as safe as they should be. That was particularly true for convenience stores in Sweden, where a recently deployed automated cash-management system has dramatically improved safety and store operations for 7-Eleven.
Sweden poses a surprisingly challenging risk for crime prevention. According to the U.S. Department of State, instances of violent crime are increasing in Sweden. Robert Winslow, Ph.D., a professor at San Diego State University, analyzed data from INTERPOL and the United Nations and concluded that the crime rate in Sweden is high compared to other industrialized countries.
Retailers confirm this is true in some areas of the country. Johannes Sangnes, CEO of Reitan Servicehandel, Stockholm, Sweden, the parent company of 7-Eleven stores in Sweden, Norway and Denmark, told Chain Store Age that his company chose a totally closed cash-handling system because of “problems in some cities about robberies.”
The i-CASH automated system, from Wincor Nixdorf, Paderborn, Germany, and Austin, Texas, has been deployed in 13 Scandinavian 7-Eleven stores and will likely be placed in other stores.
“The authorities tell us in which stores we have to put the system,” Sangnes continued. “[Enhanced security] is required in shops if you have a certain number of robberies.”
By integrating ATM and POS technologies, the i-CASH system minimizes the amount of contact store associates have with cash. Currency is fed into the system which automatically counts, sorts, checks for counterfeit currency, reconciles change due to customers and transports cash. The system can read and digitally validate bills from $1 to $100, in U.S. currency, and comparable notes in other currencies. It then passes the money into locked cassettes for transport to banks.
In some installations, shoppers feed the money into the system and receive change without the aid of a cashier. In other cases, the cashier accepts the cash and puts it into the machine. Either way, the cashier never has to open the cash drawer or count change, and never has access to the money.
“It has reduced administrative costs and is also more efficient and productive,” said Sangnes. “It has reduced about two hours per day [from processing] and that reduces staff costs. But the main thing is, it has reduced risk.
“It is very important to think of the people working in shops, because they are most important to me. The i-CASH system is really about the safety of our people and it has helped us to reduce robberies.”
The number of stores that will implement an i-CASH system is yet to be determined. “It is too soon to measure the return on capital investment but it seems to be going in the right direction,” Sangnes noted.
Reitan Servicehandel is one of the biggest retail companies in Scandinavia, with some 1,082 shops including 82 7-Eleven stores and 320 Pressbyran stores, a Swedish retail brand. Last month, the company announced it would roll out an additional 130 7-Eleven stores by July 2009 inside recently acquired Shell stations. Reitan Servicehandel also owns the national Narvesen chains in Norway and Latvia, Preses Apvieniba in Latvia and SpaceWorld in Norway.
Dillard’s 3Q loss widens
LITTLE ROCK, Ark. Dillard’s reported a third quarter net loss of $56 million, or 76 cents per share, compared to a net loss of $11.3 million, or 15 cents per share, for the same period last year.
Dillard’s ceo, William Dillard, II, stated, “The oppressive economic environment clearly weighed heavily on our results during the third quarter. We continue to take aggressive action to navigate these challenging times. We announced the closure of 21 under-performing stores during 2008, dramatically reduced capital spending for 2008 and 2009 and are executing appropriate operating expense reduction measures throughout the Company. These efforts are not only designed to position ourselves to weather near-term economic uncertainty but also to position Dillard’s well for the long term.”
Net sales for the quarter were $1.508 billion compared to net sales of $1.633 billion last year. Sales in comparable stores declined 9%.
Fred’s sees 3Q income growth
MEMPHIS, Tenn. Fred’s reported net income of $6.1 million, or 15 cents per diluted share for the third quarter 2008, an increase of 32% from net income of $4.6 million or 12 cents per diluted share in the year-earlier quarter.
Fred’s total sales for the third quarter of fiscal 2008 were $418.0 million compared with $419.9 million for the same period last year, with the year-over-year decline of 0.4% reflecting the company’s store-closing program. Excluding stores closed in 2008, total sales from ongoing stores increased 4% over the third quarter of last year. On a comparable-store basis, third quarter sales increased 1.4% versus 1.1% in the year-earlier period.