How do you measure the ROI on a security system?
Throughout our lives, certain letters in the alphabet take on an importance that can pay long term dividends. In grade school, it was all about mastering the ABC’s. As teenagers, we became singularly focused on the college entrance exam, the SAT’s, which at the time I was convinced was an abbreviation for Satan himself. And when we finally reached adulthood, there was a whole new alphabet soup of financial literacy to master in the form of IRAs, P&Ls, EBITDAs, and ROIs.
For business owners and executives, being able to understand their company’s financials is critical. Perhaps, one of the biggest indicators of money well spent is one’s ROI or return on investment. While some other business expenditures are easily measured and ingrained in concrete numerical values, when it comes to keeping your business and assets safe, the values of those financial investments aren’t necessarily as black and white.
According to a survey by the National Retail Federation, retailers have been faced with not only rising rates of both violent crime and property crime, but those incidents have been increasingly brazen as well. It’s not surprising that businesses are steadily investing more resources and consistently looking for effective ways to combat this tide of criminal activity.
Traditionally, the ROI on money spent on security measures has always been difficult to calculate as it is largely rooted in prevention. Security and law enforcement experts both agree that the best way to stop crime and limit property damage or financial loss is to stop it from happening in the first place.
The question looms, how do you measure success when success is predicated on nothing happening?
Part of the answer now lies in a recent study conducted by the independent Loss Prevention Research Council (LPRC). In the study they took data that was gathered by LiveView Technologies (LVT) in collaboration with the local police departments, municipalities, and retailers of Opelika, AL and Paducah, KY over a 6-month period. This collaborative effort resulted in the formation of the Alliance of Companies and Communities to Enhance Safety and Security (ACCESS) Taskforce which sought out to see how effective mobile security units, specifically those provided by LVT, could be in curbing crime in those respective cities. The findings are encouraging and perhaps provide the most direct response to those weighing the value proposition of investing in deterrence.
Both Opelika, AL and Paducah, KY experienced an overall reduction in crime which comes after a trend where they previously experienced a 20% increase in crime, ranking both cities firmly in the 90th percentile. When it comes to reducing nefarious activities, experts cite the importance of crime displacement, the idea where one business’ security precautions can help push crime not only away from their own business but neighboring businesses and adjacent areas as well.
Data from the ACCESS Taskforce supports this idea as both cities experienced the reduction in crime not only in the immediate areas where the LVT Units were placed, but in the surrounding geographic areas. Opelika Chief of Police, Shane Healey attributes that to being able to mobilize his police force in a more strategic way. “When that retail crime is decreasing then I can take the resources of a physical police officer and move them to another area where we may be having some other type of crime.” Healey says that this can have compounding effects. “There’s now another visual cue that the police are here, they’re doing things in this area which hopefully makes the bad guys make a different decision and not commit crimes there so we can be proactive.”
The study has not only shown the ability to create a more proactive police force but has shown many businesses what experts have long espoused—that proactivity is the best defense in fighting against criminal activity. For Pete Kepler, Director of Security and Investigations for the retail giant, Advance Auto Parts, the results of the study provide welcome evidence to decision makers pondering the ROI of mobile surveillance systems. “Any time we have the opportunity to gather actual data and help drive decisions versus just gut instinct, it’s going to be an easier sell to say I really need to put one of these devices here.”
While the study is a snapshot looking specifically at two cities, the benefits of the LVT Platform have proven to decrease parking lot incidents by 70%, shoplifting by 66%, and violent crimes by 60%. Wherever the LVT Platform has been deployed, safety and security has increased while crime decreased. That leaves businesses, municipalities, and citizens with concrete evidence as to the value of preventative security measures.
So, when it comes to investing in deterrence and being faced with the proposition of justifying ROI, it’s the supporting data points that make the answers just as clear, evident, and straightforward as our ABCs.
.png)