Ways to Crack Down on Cargo Theft Answering these 8 simple questions can help keep your merchandise safe from theft in transit.
By Carol Tice Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
A lot of Super Bowl parties got ruined this year when shortly before the big game, two Atlanta-area thieves made off with raw chicken wings valued at $65,000. Allegedly, employees hailed from the same Georgia cold-storage facility where the birds were stored.
This was hardly an isolated incident. Exact dollar figures are hard to come by, but the FBI describes cargo theft as a growing, "multibillion-dollar industry" dominated by professional crime rings, not amateur burglars. Theft reports analyzed by national crime database firm CargoNet reveal there were 28 percent more domestic cargo theft incidents in the first three quarters of 2012 than there were in the same period of 2011, the most recent data available.
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Given that your shipping needs may be handled by a vendor or third-party logistics firm, what can you do to help prevent theft of your merchandise? Here are 10 basic questions to ask your logistics partners:
1. Is your merchandise a target? Prescription drugs, iPods and other small electronics aren't all thieves target. In fact, CargoNet reported food and beverage items were the most commonly stolen items. Consumables represented nearly one-quarter of all reported thefts in the survey, while the two next-biggest categories, electronics and valuable base metals such as copper, each made up 15 percent of the total. Apparel and accessories round out the most-wanted list, making up 8 percent of reported thefts.
2. Do you conduct background checks? Many cargo thefts involve an "inside man" at the shipping company or warehouse, as happened with the chicken-wing heist, explains Barry Tarnef, senior loss control specialist at the Chubb Group of Insurance Companies in Warren, N.J. Background checks can reveal if drivers or warehouse staff are spending extravagantly or experiencing financial hardship, red flags they might be drawn into shady dealings such as "fictitious pickups." In this scam, employees pass information about a shipment to criminals who show up posing as a legitimate shipper to take possession of the goods.
"If you have someone who will be transporting multi-millions in merchandise for you and you haven't had a recent background check, you don't know what to expect," says John White, president of private security consulting firm Protection Management in Canton, Ohio. "People will approach truck drivers and for X amount of money, the driver agrees to let the truck be stolen."
3. Do drivers plan routes carefully? Smart drivers don't stop in isolated locations, says White. Also, a lengthy initial ride after making a merchandise pickup can tire thieves who may be tracking the load and make them give up.
4. What day of the week do you deliver? Goods delivered on Fridays and Saturdays are far more likely to be stolen, the CargoNet survey found. The number of thefts reported on Fridays, the single worst day, was more than double that of the average number of thefts reported for the other weekdays. These deliveries are often left unattended until Monday, when warehouse personnel arrive for work.
"That's an easier time to steal the merchandise," says David Shillingford, president of CargoNet's parent company, Verisk Crime Analytics. "Thieves want to avoid confrontation."
5. What safety precautions are taken? Secure companies track vehicles with GPS so they know immediately if vehicles diverge from planned routes. Properly trained drivers radio their dispatcher if they see anything suspicious or are involved in a crash, which can signal the start of a robbery. Drivers carefully secure trailers, keep absences brief, and park trailers against warehouse walls or other obstructions so that back tailgates can't be easily opened, says Tarnef. Warehouses should have working security cameras and employ armed guards if they're receiving high-value loads.
6. Is merchandise tagged? Discreetly marking merchandise for identification, or hiding tracking devices inside cartons, provides another layer of security. For instance, in February a load of stolen pharmaceuticals lifted from a truck stop in Valdosta, Ga., was recovered after a GPS device hidden in with the medicines led local sheriffs to the drugs just six miles away from the crime site, according to security firm FreightWatch.
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7. How are thefts reported? Truck drivers moving through many jurisdictions may not know who to call. Having local police contacts handy can help speed information to officers who could spot your stolen goods. Working with firms like CargoNet, as well as FreightWatch or Global Security Logistics gives you a single point of contact with your security specialist, where staff can help you quickly notify relevant local authorities. The Transported Asset Protection Association, which sets industry standards for cargo security, requires its members' drivers have written contingency plans for what to do in case of a theft, and maintain constant 2-way contact with their dispatcher, who can serve as another resource for contacting local help.
8. Do you follow industry guidelines? Good transportation firms comply with the cargo-safety guidelines for air, marine, and trucking issued by TAPA. Choose a provider with a proven focus on safety and you'll improve your odds of keeping your merchandise secure in transit. Also, be sure to check the current safety rating of your shipper with the Federal Motor Carrier Safety Administration, a division of the Department of Transportation, says Chubb's Tarnef, as it's another predictor of future safety performance.
Asking hard questions of shippers can save a lot of grief later, says Tarnef.
"If you're partnering with a good transportation company," he says, "you'll be way ahead of the game."
