As the saying goes, ‘If you forgive the fox for stealing your chickens, he will take your sheep.’ Yet many retailers in India continue to open outlets without investing in proper security systems. Amar Subhash, General Manager, Commercial & Retail of Tyco Fire and Security Systems global leaders in security solutions, tells Images Retail how crucial and unique security systems are for retailers present in different verticals.
The hungry fox
India continues to be one of the countries with the highest theft rates. So, why would a retailer here choose to operate without proper security solutions? According to Amar Subhash, CFO, Tyco Fire and Security Systems Pvt. Ltd.: “We have statistic proof that if we install an anti-theft system, the shrinkage of theft will go down by 50 percent. Our (India) theft rate is twice the global average.”
However, a lot depends on how long a retailer has been based in the market. Subhash explains that retailers in India are still not aware of proper technology and the results of installing security gadgets in their outlets. When it comes to educating a retailer, Tyco is backed up with a tremendous amount of data that helps to explain to a retailer the kind of returns that they can expect from installing security solutions.
With the growth of modern retail, there are malls coming up in small towns and cities. The need to display merchandise in an open format has become crucial for a complete customer experience.
Going back to the traditional retailer, Subhash points out that those who have been in a town for generations do not install CCTV systems in their stores as they feel it may offend their loyal customers. It is here that Tyco has implanted security systems that are inconspicuous and fit within a doorframe.
Building a secure chicken coop
Tyco offers solutions for various retail formats. A typical investment for a complete security solution in an average high-end store would be around US$ 10,000, which includes a handy cam with video installations for detecting intrusion. Security solutions for an average 1,000 sq.ft. apparel store include fire alarm, basic intrusion alarm monitoring, basic CCTV and anti-theft system, which would entail a cost less than Rs. 4 lakh.
Explains Subhash: “So basically what we are saying is that, with a level of investment we can protect stores against fire and break-ins, where we install sensors on windows as well. An alarm goes off when someone tries to break in, or open the door forcefully. Then we get an alarm at our centre, saying that there is an intrusion in a certain location. We also have PO systems that monitor shop lifting at stores and we keep a tab on the behaviour of both customers and as well as the employees.”
According to Subhash, a retailer can expect a huge return. Cost being a major factor for retailers, has led Tyco to come out with locally engineered solutions for the Indian market. Thus, retailers based in Tier-II and -III cities are offered a complete package.
Currently, Tyco solutions are present in 45 cities including the professional retail markets like Jaipur, Kolkata, Raipur, Lucknow, Coimbatore, Surat and Hyderabad. Not all these markets attract the mall-driven kind of customer segment. Typically, during the event of a large format store opening in a Tier-II or -IIII city, the local retailers often try to merge with the larger format and today every city or town has a shopping mall that gives customers an open display of merchandise baring the constant shortage of electricity, which is a constant challenge.
A typical retailer is always worried about how quickly they can open their new outlets, giving full attention to the merchandise and the aesthetics of the store.
“I don’t think retailers are concerned about security at the point when the store is under construction, but happily for us we get involved with the retailer in the middle of the process. We work with architects and the design teams of the store and manage to go through the planning,” says Subhash. “For example, we need to cut the tile to implant the security system, so the cable and camera placements are done efficiently. Cameras should not stick out as sometimes it can look very ugly,” he adds.
Getting involved during the construction of the store interiors helps Tyco in implanting security and fire solutions effectively. This helps to ensure that the cabling and wire works are done well in advance in order to prevent cameras and anti-theft systems being placed awkwardly and almost glaring at the face of the customer. In-store promotions can also be merged along with the systems. This way Tyco works very closely with the retailer.
In the case of a mall, the retailers who tie up with the developer while the mall is being built share their plans. He explains: “What we typically do is when we go into a mall, we rework with the retailer’s space. Malls have their own benchmark on how they would want to design, how they would want to bring the brands together, which is a different area altogether. So we get involved pretty early during the inception of the store.”
Plans of the store are shared whether it is a company-owned store or a franchisee-operated outlet.
More than just a coop
Tyco has also introduced many innovations apart from security systems like anti-theft, CCTV and intruder systems. The company is moving towards providing additional features like analytics to maximise a retailers returns on investment. The company offers traffic intelligence, where the number of customers who visit stores, time of walk-in and kind of products that are purchased by that particular customer are recorded. This helps retailers to make comparisons of the number of walk-ins and sales on any given day.
Subhash elaborates: “This is all integrated with our solutions. We have additional sensors now with our anti-theft antenna that monitor people coming in and going out. We are able to tell retailers the number of footfalls within an hour.”
Retailers are more interested in efficiency even though traffic intelligence is in great demand. Logistics is another area that the company operates in. By integrating the POS systems with overhead cameras and back-end analytics, transaction data are retained. The video is designed to capture a picture of the bill. This kind of remote intelligence becomes a major solution at mall cafeterias, which are usually on revenue sharing model.
Another one of Tyco’s innovations covers inventory visibility so that when a customer walks into a store and asks for a particular colour of garment in a particular size, then the retailer does not have to go down to the storeroom to check. The inventory will be visible on the computer.
Subhash states: “We are moving beyond traditional security.”
Tyco also covers solutions for showrooms as well as movie theatres, where even anti-theft tags are placed on 3D glasses. The same is applied to earphones at call centres. The company has further plans of doing business with libraries and sweet stores, where pilferage rates are higher. On a recent tie-up with a government hospital in North India, Tyco has also supplied anti-theft tags to newborn babies. This was a major hit and the company has plans of expanding this solution to other hospitals.
Since hotel restaurant kitchens are prone to catching fires, Tyco has set up a special system in restaurant kitchen hoods where all the oil and grease usually accumulates causing fires.
He explains: “Typical study shows that fires usually break out from the hotel restaurant kitchen. So, we have a kitchen roof protection system. We have specific engineered systems that protect the ports and nozzles for fires. We cover all five-star hotels. We are also applying this solution in IT companies that have fairly large kitchens. Of late, some restaurants that are keen on knowing the kind of crowd are visiting them. We also provide security solutions to a lot of liquor stores. We have a special tag for bottles on the neck, as a lot of stores are moving to touch-and-feel formats and we have done around 10–15 liquor stores.”
The introduction of the delicate tag is one of the brand’s key innovations. The delicate tag is used for tagging very delicate clothing as normal tags are quite heavy and have a bigger pin size, which can ultimately damage a fabric. Tyco researched at least 20 different kinds of saris from various parts of the country to test the ability of the delicate tag.
Subhash elaborates: “The delicate tag has an extremely thin pin. This tag has grown popular in Europe and the US, mostly for tagging lingerie. Specifically we have made black colour tags for the Indian market. We have made this delicate tag keeping the retailers in mind. The tag is designed in India for India. We noticed that there is a lot of interest in the south for the delicate tag.”
The reusable tag, which is usually for Pashmina shawls, has sold a billion within just three weeks. Targeting luxury brands, designers and other exclusive stores, the investment that goes into a delicate tag is Rs. 25.
He adds: “The ROI is very justified. If you reduce the pilferage by 0.5 percent in the current level, the tag ensures that the retailers get their returns within a year.”
Tyco’s fire and security solutions are promoted through events where all the products are displayed for retailers. Explains Subhash: “We had invited all the local retailers like the commercial and industrial customers and we did a one-day show. Following this we did a series of events just around retail, previously in Pune, then Ahmedabad and then started doing it at very specific markets.”
According to Subhash: “Efforts made at emerging markets like Surat, Baroda, Amaravati, Nagpur, and small towns like Mysore and Mangalore have paid off well.” He added that Kerala was quite well spread with the connectivity to the Western world and so requires of advanced solutions. Raipur also has a lot of retailers looking for solutions as well as Jaipur and Udaipur.
Subhash finds that retailers are more interested in traffic-based solutions. Hypermarkets are also adopting anti-theft systems by installing selective tagging.
Keeping the fox away
In the case of modern retailers, though costs are always an issue, Subhash feels that they are largely focused on opening or expanding their outlet whereas the traditional retailer, who is not very aware of security solutions, does adapt to the solutions quickly. He says: “The traditional have a solid retail story. They are not in a hurry to open stores. So, once they open an outlet, we are able to meet their requirements better. Traditional retailers are focused on improving store efficiencies and serving their loyal customers. They are at a different level of adding more solutions. The next generation of traditional retailers are now taking over the reins of the business.”