Lockup by Digilock Reduces Shrink and Contributes to Retail Profitability

By Mila Adamovica

Lockup logo

As a manufacturer of electronic locks and lockers, Digilock® is thriving in the security solutions industry expanding beyond the traditional security markets into securing personal belongings. The evolution of Digilock’s product offerings is driven by the market demands for personal security. In 1992, the company was the first to introduce a keyless electronic lock for cabinets and lockers. Today, manufacturing electronic locks is one of the fastest-growing segments of the security and access-control marketplace. IHS, a global information company, forecasts that the global market for electronic locks will exceed $1 billion in 2015.

Why Is Fighting Shrinkage Challenging?

The importance of loss prevention is a major topic of discussion across the retail industry these days. One of the latest retail security surveys stirred another round of magazine publications and social media posts regarding the reasons of the increase of the so-called “shrinkage.” According to the 2015 National Retail Security Survey, conducted by the National Retail Federation and the University of Florida, two main culprits are shoplifting and employee theft.

Retail Shrink Pie-Chart

Statistics from 2015 National Retail Security Survey

As Oscar Wilde said, “I can resist anything but temptation.” “The average loss for internal theft is nearly five times that of shoplifting,” says Los Angeles Times editor Nick Shively’s article.

Dr. Richard Hollinger, a criminology professor at the University of Florida, who leads this annual study, pointed out during a Q&A with Los Angeles Times reporter James F. Peltz, “There is no form of property crime in America that adds up to $44 billion a year. Bank robberies, household burglary, auto theft, none of them. In fact, if you add all of those up, they don’t get close to $44 billion a year.”

“Digilock, committed to developing new products that are driven by customer demands, created a perfect loss prevention solution for retail environment—Lockup—to add to the holistic loss prevention strategy and to enforce the traditional loss prevention activities.”

Another study, The Global Retail Theft Barometer™ report, was carried out in 2014 by Checkpoint Systems, which teamed up with The Smart Cube and Ernie Deyle, a retail loss prevention analyst. It was conducted in twenty-four countries among 222 retailers representing $744 billion in sales in 2013. The lowest shrink rates were recorded in Norway (0.83 percent of retail sales), and the highest rates were recorded in Mexico (1.70 percent) and China (1.53 percent). The United States came in at 1.48 percent of retail sales. With the evolution of loss prevention techniques, retailers have been able to reduce shrink as a percent of sales; however, the actual dollar loss due to shrink continues to grow according to Alan Fanarof, retail practice head ANZ, Cognizant.

To reclaim lost revenue, retailers are using different means to develop employee awareness about the vital importance of loss prevention. The most common way is to perform extensive new employee background and references checks and to communicate conduct guidelines during the new employee training, focusing on the severity of the employee theft issue and its consequences. Another approach is to continuously work on developing good relationships with employees. Companies with the lowest turnover rates have the lowest internal theft rates.

Although most stores have a strategy in place to fight shrinkage, the statistical research shows that, despite all the retailers’ efforts, the industry has hit a plateau in the fight against shrink. According to FBI reports, employees’ theft is the fastest-growing crime in America. Now the dilemma emerges—how to stay ahead of the curve and prevent shrink in stores, while providing secure storage for employee belongings. As the saying goes, “Where there’s a will, there’s a way.”

How Lockup Solution Works to Combat Shrink


Employee merchandise theft that does not involve a cash register is difficult to identify because you have to catch it in the act. It is much easier to proactively prevent this kind of theft than to deal with it after it has already happened. What proven methods empower stores to dramatically curb retail shrink? Digilock’s patented technology and responsiveness to market demands is ensuring security simplified® with an out-of-the-box approach that allows a locker to be always available for each employee to secure belongings.

Options include a clear polycarbonate door giving store managers the ability to see the contents inside the employee lockers, contributing to internal theft prevention. The procedure is simple: store employees gain access to their lockers with the entry of a four-digit keypad code, and the store management controls and audits the lockers by using an electronic manager key.

“Digilock’s patented technology and responsiveness to market demands is ensuring security simplified® with an out-of-the-box approach that allows a locker to be always available for each employee to secure belongings.”

Lockup® delivers a top-of-the-line employee locker complete with the security of a shared-use keypad lock. The locker is manufactured from heavy-gauge powder-coated metal to withstand heavy use in demanding environments. It is delivered ready-to-use, fully assembled with pre-programmed electronic keypad lock. Lockup locks are designed specifically for retail employee use, where multiple shifts are scheduled throughout the day. This shared-use technology allows employees to occupy one locker during their shift, and once vacated, the locker is available for another user. The electronic manager key permits locker audits and provides external power for locks. Lockup offers retailers a cost-competitive solution for secure personal storage and a shrink-reduction plan. Digilock, committed to developing new products that are driven by customer demands, created a perfect loss prevention solution for retail environment—Lockup—to add to the holistic loss prevention strategy and to enforce the traditional loss prevention activities. Lockers enable store management to take proactive steps to ensure merchandise is not lost.

Contact us at 707-766-6000 or sales@digilock.com for a free demo locker and learn why Lockup is the preferred employee locker choice among retailers. Or visit us online at lockup.com for more information.

This article was originally published in Loss Prevention Magazine, September-October 2015 issue, p.67-68.

Download: LP Magazine Solutions Showcase: Lockup by Digilock Reduces Shrink and Contributes to Retail Profitability.pdf

About Digilock

Digilock® is the global leader in electronic locker locks, cabinet locks and office furniture locks that use patented keypad and RFID technology. Digilock’s locks and lockers for health and fitness clubs, athletic locker rooms, schools, colleges and universities, hotels, spas and office environments are high-performance, turnkey security solutions.
This entry was posted in Lockers, Lockup lockers, Product Showcase, retail, Security, solutions showcase, theft prevention and tagged , , , , , , . Bookmark the permalink.

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