Categories: Risk prevention

Three key strategies for retail risk management

As a retailer, sales are likely at the forefront of your mind. But you also need to be taking precautions to protect yourself from risk, with a retail risk management plan. After all, a costly liability lawsuit, cybersecurity breach, or robbery could really put a damper on your day-to-day operations. Here are three of the key risks retailers should be aware of, and some tips on how to prevent some nasty consequences that can arise.


No one thinks it will ever happen to them. After all, theft is something reserved for heist movies and TV shows, right? Wrong.

Theft is still a common issue for retailers in Canada. In fact, organized retail crime costs Canadians over $4.6 billion a year, according to statistics from Calgary police. Their stats also say that 87.5 per cent of independent stores fall victim to this kind of crime, and the money raised from the sale of stolen items funds other criminal activities like guns and drugs.

Organized retail crime costs Canadians over $4.6 billion a year.

But many of the robberies aren’t after merchandise you’d expect. Items like electronics or jewelry are classic targets, but not the only focus. Instead, many criminals are targeting things like cologne, baby formula, and clothing. For instance, on Canada Day in 2017, almost $20,000 in Lululemon gear was stolen from a Moksha Yoga Studio in Stoney Creek, Ontario, after three masked men broke into the studio using a hammer.

Thankfully, some simple retail risk management tips can help you prevent theft in your store. Reviewing your store’s layout and making necessary adjustments is a good idea. That way, you can make sure that there’s enough lighting and the expensive items are located near the checkout. Keeping electronic tags on all merchandise is also helpful, as these can detect non-purchased items that exit your front door. And don’t forget to use security cameras wherever you can to keep an eye on every nook and cranny of your store.

Slips, trips, and falls

That beautiful snow that falls from the sky around this time of the year creates a winter wonderland outside. But it also creates more opportunities for your customers to injure themselves while shopping. With snow and cold weather comes ice and slippery floors, as boots track water in from outside.

Even without extra-slippery conditions, falls are already prevalent events. A 2015 report on the cost of injuries in Canada from Parachute, a national charitable organization, found that every hour in Canada 427 people suffer a preventable injury as a result of a fall, a motor vehicle crash, a fire, poisoning, drowning, or other activity.

For situations involving third-party bodily harm, commercial general liability insurance is always a good idea. But there are also some retail risk management practices you can implement to improve your chances of eliminating slips, trips, and falls entirely.

Mind the moisture

Non-slip tile and skid-resistant mats should be placed in water-prone areas (such as the front entrance). Employees should regularly check these areas and clean up any pooled water as quickly as possible, while also being sure to leave “wet floor” signs in place when needed.

If your store has a parking lot, it should be checked regularly, and salt and shoveling should be used to clear paths for customers. Downspouts that drain water onto parking lots or walkways should also be redirected, as these can cause ice to build up during the winter.

Bright and tidy

No matter the time of the year, paths where customers may be walking should be clear of clutter and adequately lit. Merchandise should be kept at a height to accommodate an average person and displayed in such a way that it’s not likely to be knocked over, broken, or spilled.

Write it down

It’s especially important that all maintenance activities be documented in a log book. This ensures that if a claim is brought forward, you have a track record of all the precautions you’ve taken to prevent injuries. It also serves to help employees behave as procedure dictates.

And if all else fails, having a response plan in place is key. Accident report forms should be available on site and completed if someone is injured. The claimant should fill one out, along with any available witnesses who can detail what happened. Photos should also be taken of the location of the fall and of the footwear the claimant was wearing that day.


Times are changing. And with the introduction of new technologies come more risks to worry about.

More than one-third of Canadians have been a victim of cybercrime in the last three years, according to Accenture’s 2017 Canada Cybercrime Survey. And the number of cybercrime complaints has risen steadily over the years: in 2014, the RCMP fielded 7,965 complaints of cybercrime. In 2015, that number rose to 9,217 and in 2016 it hit 11,518. Businesses are not immune to these attacks. The number of spear-phishing campaigns (when hackers send emails that appear to be from a trusted source) targeting employees increased by 55 per cent between 2014 and 2015.

More than 1/3 of Canadians have been a victim of cybercrime in the last three years.

Despite these numbers, 77 per cent of owners surveyed did not have any coverage for data breaches and cyber attacks, according to a poll we conducted of 300 Canadian business owners. And only a third of those polled felt confident that they had the financial resources to survive an attack that exposed their customer data or a class action suit that resulted from an attack.

These statistics show why it’s important to take preventative measures. First and foremost, passwords should be unique and updated on a regular basis. It’s also important to think before you click: emails from unknown or sketchy sources should be verified before they’re opened, and terms and conditions should be read when installing or downloading things like software.

On top of that, you should update your software often and install anti-virus software on your computers. If all else fails, it’s important to have your data backed up. Whether you use cloud sharing or an external hard drive (or maybe even both), having important files and documents in a second location is key for a quick response and recovery if you become the target of cybercrime.

Protect yourself

Taking precautions with a retail risk management plan is always a good first step, but sometimes it isn’t enough. Despite your best efforts, things can go wrong and it’s important to be prepared for that, too. That’s where insurance comes in.

When you find yourself in the worst-case scenario, you don’t want to be left covering all the costs yourself. To ensure that you can operate your business worry-free, Federated offers insurance specifically designed for wholesalers and retailers – visit our wholesalers and retailers insurance page today!

This blog is provided for information only and is not a substitute for professional advice. We make no representations or warranties regarding the accuracy or completeness of the information and will not be responsible for any loss arising out of reliance on the information.