By Bill Scott, founder of StoreReport LLC & Scott Systems Inc.

Starting and running a business is not for sissies. I know, because during my life I have started several. 38 years ago I finally got it right. There’s an old saying that goes, “If you want to start a perfect company, start your third one first.” But, whether you’re on your first business or you are working on your third, or even forth, there are a few rules you must adhere to in order to be successful. But, even as we speak the rules are changing, and if you get complacent you are in trouble already.

In the convenience store business, there are several things you must get right, or at best you’ll end up with a hard, boring job that you will eventually give up… or worse. ‘Location’ is probably the most important in the beginning, but by itself location won’t do it for you. My experience has taught me that superior inventory management is every bit as important as location, especially these days as employee expenses are going through the roof. Having the right products to sell when your customers want to buy is crucial, but having overstock can lead to even more serious problems.

Here are a few tips I would like to pass on that were taught to me by my customers.

Lead Your Employees Toward Believing You Are More Watchful Than You Are
32 years ago, I was installing a computer for a new customer. The owner and I walked over to a store next to the office and the store manager asked about how the new computer installation was going. The owner of the business was quite the character. His father-in-law ‘Burt’, did odd jobs around the store, like sweeping the driveway and making minor repairs. The owner proudly announced to the manager, “Well we’re putting stuff in and getting stuff out, and we have already discovered that a pack of Nabs and pair of work gloves are missing.”

Back in 1984, managing inventory by item in retail stores was simply impossible. Nevertheless, from the back of the store an anxious clerk called out, “Burt stole the gloves!” We have continued to laugh about that incident over the years, but it taught me a valuable lesson I never forgot. Security is more of a feeling than it is a subject. Employees will provide you with more information than you need if you know how to pave the path to confessions.

Your Employees Will Police Themselves If They See It As An Advantage
Many years later, while I was installing a perpetual, inventory control system in another store, I heard a cashier admonish a co-worker when she said, “I hope you’re going to pay for that Snickers. I don’t want it to come up short on my shift.” Again, sometimes honesty begins as a product of the fear of being caught. Grabbing a candy bar and conveniently forgetting to pay for it isn’t dishonesty to everyone.

Sloppy Inventory Control Leads to Sloppiness In Other places, Too
If They Think You Don’t Care, They Won’t Care Either. The amount of employee theft that occurs in convenience stores is directly proportional to how the inventory is managed. Sloppy stores, higher theft. Neat stores, less theft. When employees see a lax attitude toward stock, especially things accumulating in store rooms and on unorganized shelves, if they get the attitude you’re not concerned they won’t have any qualms about taking it.

In the weeks and months ahead, the minimum wage issue is going to drive convenience stores to more and more automation. Start looking ahead. It is past time to ignore the things you have been ignoring for years. Help lead your employees down the road of honesty by proving you care about what’s in your store.