Chronic Shortages? Roll the Videotape

Q: We’re a motor carrier and have been having ongoing problems with one of our major customers.

This customer, a major department chain, is actually the receiver, not the shipper. They arrange for their inbound moves (at least the ones we handle), and we perform the service.

The customer does its own unloading; our driver isn’t allowed on the dock for safety and liability reasons, the customer says. What’s been happening is a steady stream of shortage claims. They’re not usually big shortages — one, maybe two or three, cases — but over time the claims add up.

I did some analysis of these claims, and what I found is that the claims are almost always on shipments of smallish, consumer-desirable items: cell phones, for example; clothing (usually jeans, shoes, women’s fashion accessories, like that); packaged foodstuffs (the chain has a grocery department); household items; beer and wine — stuff that people want for themselves and can pretty readily carry. They’re rarely larger items, like TV sets and computers and furniture; we seldom get claims involving those things.

It seems to me pretty obvious what’s going on, but I don’t know what to do about it. I’ve tried talking (circumspectly) to our customer’s management, but they just brush me off. I mean, I can’t exactly come out and tell them they have a bunch of thieves working for them. Mostly, the claims are small, but some of them aren’t — I mean, I was shocked at how much a carton of cell phones is worth, and there are other things, as well. This is really beginning to grate on my nerves. Can you give me any advice?

 

A: Well, as you say, the reason for these claims seems obvious. I commend you for your analysis and your perseverance.

But you’re not looking for plaudits; you’re looking for answers, and I can’t offer you any easy ones. I can, however, suggest some avenues you might pursue that you may not have thought of.

First, I doubt you’re the only carrier experiencing this problem. You likely know (or can readily find out) the identities of your competitors who also serve this customer. The first step I’d recommend is that you contact some of them quietly and compare notes.

What you’re likely to find is that this is a lot more than a matter of petty pilferage. One case of sardines goes missing every couple of weeks; OK, the dock crew is just enjoying some good lunches. But when cartons of cell phones and jeans and such go missing regularly, that’s a lot more organized and clearly not all for personal use by the thieves. I mean, how many cell phones can one person carry. How many pairs of jeans can he or she wear? This stuff is being resold, and probably generating pretty significant revenue for those taking it.

Assuming you find others having the same experience, you can band together to stop it. Your customer’s managers may blow off isolated complaints based on speculation, but if you offer them hard evidence of what you’re saying, I seriously doubt you’ll find them so blasé.

It’s pretty simple: Put together an informal coalition of carriers that have been having the same problem and want it stopped, and hire yourselves an investigator. It shouldn’t take long to get proof of the thefts, including video, from surveillance or infiltration. At worst, the investigator can watch the dock employees leaving the customer’s facility at the end of their shifts; they have to be getting the stuff out of there some way, and the easiest is to just hand-carry it in sacks or briefcases.

Once you have your evidence, insist on a formal meeting with your customer’s higher-level managers to present it. You can’t really take it to the cops, because the thieves aren’t stealing directly from you (OK, you wind up paying for it, but the thefts are actually from your customer). Make your case, and then offer your customer two choices: It stops the stealing or it stops the claims and eats the costs themselves.

Why do I think they’ll go for door No. 1?

Of course, you can drop the customer — or continue to live with the nagging claims and regard it as simply a cost of doing business with this customer. But I’m sure you’ve thought of these options and you seem to have rejected them. So try what I’ve suggested. It should work, and should cost you a lot less than these persistent claims.

Consultant, author and educator Colin Barrett is president of Barrett Transportation Consultants. Send your questions to him at 5201 Whippoorwill Lane, Johns Island, S.C. 29455; phone, 843-559-1277; e-mail BarrettTrn@aol.com. Contact him to order the most recent 351-page compiled edition of past Q&A columns, published in 2010.

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