By  on June 9, 1994

NEW YORK -- Electronic-article-surveillance systems have been the eyes of store security guards for years, but new designs are letting retailers make those systems as visible or inconspicuous as they choose.

Companies across retail venues rely on EAS systems to keep a lid on external shrinkage. Deliberately conspicuous sensor gates at checkouts and mall openings often persuade shoplifters to pass a protected store by. But retailers and malls who want to downplay crime for law-abiding shoppers are turning to less-conspicuous systems.

"Today the average consumer is aware of EAS technology, so we really don't need the gates anymore," said Joe Klein, director of asset protection at Herman's World of Sporting Goods. "And some malls don't like the gates from an aesthetic point of view, so we're taking a proactive approach and removing them on our own."

Herman's is just one of many retailers opting for less-obtrusive systems. Marks & Spencer Canada, the Toronto-based unit of Britain's Marks & Spencer PLC, has also opted for ceiling sensors -- and for like reasons.

"The gates create too much of a prison atmosphere, so our sensors are concealed in the ceiling" said Michael Strachan, corporate operations manager. "Anybody who comes into the store with the intent of stealing is looking for an EAS system. They know it's there even if we don't have visible gates."

"The constant debate is whether to have the visual deterrent," commented John Plens, vice-president of loss prevention at Montreal-based Dalmy's, an upscale women's wear retailer. "But in the fashion business, the aesthetic appeal of the store is very important. The cattle gates might be appropriate for a sporting goods stores but not in stores like our high-end boutique Cactus."

The major vendors of EAS systems have provided alternatives to the gates consumers commonly associate with their systems. Deerfield Beach, Fla.-based Sensormatic Corp. can now install its magnetic sensors in the floor. Hauppauge, N.Y.-based Knogo Corp. gives retailers the option of hiding its radio-wave sensors in ceilings. Though a great many retailers want the in-your-face deterrent the gates provide, most appreciate the ability to choose.

Marcel St. Jean, director of loss prevention at Toronto retailer Holt Renfrew, said that chain has also opted for less-visible sensors. In Holt Renfrew stores, the sensors are in "wide exit pillars, not cattle gates," St. Jean said. Like Marks & Spencer, Holt Renfrew uses a Knogo system.But it's not only the sensors that can be hidden from the shopper's eye, the tags themselves can be as noticeable as the large, three-inch plastic disks retailers might affix to expensive leather jackets or as inconspicuous as the disposable metal wires some drug stores and supermarkets are concealing in the packaging of high-shrink, high-margin health and beauty aids.

Most retailers, however -- drug stores included -- continue to opt for visible tags. Deterrence is again the reason, as Kirk Diegel, vice-president of loss prevention at Detroit-based Perry Drug Stores explains. The 212-store chain uses a Sensormatic system in roughly 75 percent of its stores. Installations began early in 1992.

"Our major competitor doesn't use an EAS system and is experiencing a lot of shoplifting," Diegel said. "And when they interviewed the shoplifters they caught, a number of them said they avoid our stores because of the EAS systems."

"The whole premise behind electronic article surveillance is deterrence," Herman's Klein added. "And the tags act as a deterrent even if the sensors are concealed."

Herman's is currently installing a Knogo system. The tags combine the radio technology with low-tech, ink-releasing pins.

"The ink tags are actually the pins that hold the EAS tags on," Klein explained.

Marks & Spencer has opted for tags that are small enough not to detract from the garment but large enough to serve as a visual deterrent.

"We tried to strike a balance between the cumbersomeness of the tag and visual deterrence," Strachan said. "The tags are about 1.5 by 1 inch with a chrome pin in the middle that slides into the tag. Our cashiers can detach the tags with one hand with a decoupler that is attached to the counter."

Holt Renfrew has also opted for tags that are small enough not to detract from merchandise but large enough to make themselves known to shoplifters. St. Jean said the tags should be conspicuous enough to act as a first line of defense against would-be thieves.

"We don't wait until shoplifters get to the doors and see the pillars to let them know merchandise is protected," he said. "They have to know when they pick up a garment that it's tagged. The tags have to be placed where they are visible."Since Dalmy's conceals its sensors in store ceilings, the company is doubly careful to make sure potential shoplifters know the store is protected.

"The tag itself is the visual deterrent, but we support it with signage in the fitting rooms," Plens said. "The largest percentage of our shoplifting occurs in fitting rooms."

Like Marks & Spencer, Dalmy's uses a tag with an ink-releasing pin in its high-shrink stores. The precaution has significantly reduced the number of tags store employees find on fitting room floors.

"We found a great reduction in attempted removals when we used the ink tags," Plens continued. The system is not foolproof, however. Plens said some shoplifters are finding ways around it.

"Now we are finding condoms wrapped around discarded ink tags," he said. "Some ingenious shoplifters wrap the tags so they don't explode when they remove them."

Marks & Spencer's Strachan, however, said beating the systems is not easy. The chain initially tested its system in seven stores beginning last July before rolling it out to 41 stores between March and May of this year. The effect of the system on shrink in the test stores was dramatic. Soft-goods shrinkage dropped by 60 percent.

"People managed to remove only 26 tags," Strachan said. "We found them in the fitting rooms. "The system is beatable, but, boy, they're having a hard time doing it."

The question of visual deterrence aside, retailers are generally happy with whichever EAS system they choose. Herman's is a strong believer in the systems, according to Klein. He said that realization was learned the hard way when the chain removed the systems from a New York City store.

"When Herman's took the EAS systems out of our Third Avenue store, shrink shot up to seven percent," he said. "When I put the system back in, it went down to 1.5 percent. We have EAS systems in all 97 stores, and shrink averages 0.5 to 3 percent, depending on the store."

Other retailers are also high on the systems.

"I'm a strong supporter of EAS systems," Dalmy's Plens said. "The systems normally pay for themselves in the first year."Strachan expects Marks & Spencer to recoup the $1 million it spent on the EAS systems in 1.6 years. He added that the store plans to concentrate on internal shrink now that the systems are in place.

"Now our energies and resources will go toward internal theft," he said, adding that 60 percent of the chain's shrinkage was attributed to shoplifting, 30 percent was internal and the remainder occurred in bookkeeping.

"The EAS systems cut our external shrink in half," Perry's Diegel added. "And that has allowed our store managers more time to supervise employees and control internal shrink."

Internal shrink accounts for roughly 40 percent of the shrink at Perry's, he said.

Dalmy's Plens added that EAS systems give retailers a handle on how severe their internal shrink problems are.

"If you shrink level stays high with an EAS system, you can be pretty sure your shrink is internal," Plens said.

The systems also benefit retailers by augmenting other shrink-control measures or allowing them to dispense with more costly controls entirely.

"We were spending $100,000 a year on security guards," Marks & Spencer's Strachan said. "Now, we don't employ them anymore."

But security guards stayed on at Perry's after that chain's systems were installed. "We haven't reduced any security in our stores," Diegel said. "They back up the EAS system by responding to the alarm."

Though Marks & Spencer hasn't reduced the number of security guards, the chain has redeployed other security devices since the systems came on line.

"We left our security cameras in place, but are redeploying them to concentrate on internal theft," Strachan said.

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