The Concern
A multi-outlet retail chain had been losing stock for several months, and the losses were getting worse. Read More
What We Did
Analysed inventory and sales data from all affected outlets to find where the losses were concentrated and when they happened. Read More
What We Found
Losses were heaviest in three outlets that shared the same supply vendor and the same receiving staff. Read More
The Outcome
Leadership got a clear, evidence-backed account of how the losses happened and who was responsible. Read More
The Concern
A multi-outlet retail chain had been losing stock for several months, and the losses were getting worse. At first, the gaps looked like the normal shrinkage every retailer expects: some damage, some miscounts, the occasional theft. Internal audits blamed administrative errors and recommended tighter stock-taking, but every quarter the numbers grew.
As the losses mounted, leadership noticed that they weren’t spread evenly. Some outlets were affected far more than others, and the internal team couldn’t explain why. Stock records looked complete, delivery paperwork was signed and nothing obvious stood out. That made it more worrying, because it suggested the problem was buried inside processes everyone assumed were working.
The management team also faced a delicate situation. Acting on suspicion alone could hurt morale, damage relationships with trusted staff and vendors, and expose the business to legal risk if the wrong people were accused. They needed an independent and confidential investigation that would establish what was happening, how it was happening and who was involved before taking any action.
What We Did
- Analysed inventory and sales data from all affected outlets to find where the losses were concentrated and when they happened
- Reconciled vendor deliveries against purchase orders, goods receipt records and invoices to test whether what was billed matched what arrived
- Reviewed access records, shift rosters and stock-handling processes to see who had the opportunity at each stage of the supply chain
- Ran discreet background and relationship checks on the vendor and on staff in key roles to identify any undisclosed connections
- Conducted structured interviews with selected employees once the evidence was in place, and documented every finding to an evidentiary standard
What We Found
- Losses were heaviest in three outlets that shared the same supply vendor and the same receiving staff
- Deliveries were regularly signed off as complete even though they arrived short, so the gaps were absorbed into stock records as shrinkage
- A store-level supervisor had an undisclosed personal connection to the vendor’s delivery team
- The difference between invoiced and delivered goods was being resold through informal channels
- Weak segregation of duties meant one person could receive, verify and approve stock entries with no independent check
The Outcome
- Leadership got a clear, evidence-backed account of how the losses happened and who was responsible
- The vendor relationship was ended, and the business pursued recovery of losses
- The employees involved faced disciplinary and legal action based on documented findings
- Receiving and verification processes were restructured with independent checks at each stage
- Shrinkage in the affected outlets dropped sharply in the following quarters