Best Of Industry Insights: Retail
Dec 19, 2019

As we wrap 2019, we wanted to share some of the best of our Industry Insights for retail, along with some updated statistics to keep you apprised of the latest information. 


Gift Cards as a Mitigation Strategy:  In this Industry Insight we talked about how gift cards can provide a nifty alternative to settle low value claims and provide the following benefits:

  1. Repeat Visits – This one is simple.  Naturally with the gift card in hand, the customer is highly likely to return to one of your locations to get the value of the card.  This gives us another chance to provide an enjoyable and incident free visit, which will enhance brand recognition and customer loyalty. 
  2. Increased Revenue / Lower Claim Costs – The revenue increase comes from the fact that 65% of gift card recipients spent 38% more than the face value of their cards.  Your claim costs will actually be lower than the value of the gift card as the markup factor is embedded into the value of the card.  If a claim is entirely settled with a gift card, this puts those settlement funds back to work inside your locations
  3. Insights – When you track the usage of the gift cards and tie it together with your claims data, you will gain insight into how soon a party returns to one of your locations after the original incident


Shoplifting Impact:  A Facefirst 2018 Study indicated “60% of known shoplifters were detected entering at least two separate locations of the same retail chain.  20% of known shoplifters visited three or more locations of the same retail chain.”  Click here to see Facefirst’s report on interesting 2019 retail crime  statistics.

This increase in violence has forced retailers to re-examine how they mitigate and prevent such acts, tactically and strategically. Based on data from over 300 Gallagher Bassett retail clients, the cost of workers’ compensation claims related to violence has increased by 68% over the last five years, while non-violent claims rose 6%.  Inside this Industry Insights we provided recommendations on how to assess your risk, establish a policy and conduct training to help mitigate the impact of shopping on you total cost of risk.


Retail Wage increases Don’t Have to Impact Indemnity:  TTD is directly tied to an injured worker’s average weekly wage (AWW), the aforementioned wage inflation has the potential to greatly increase retailers’ indemnity costs, if measures to reduce these costs are not part of your risk program. We provided insight on ways to “hit the brakes” on TTD costs by implementing robust RTW programs and selective utilization of Nurse Case Management.  



Don’t Let a Valuable Witness Slip Away:  In a roundtable discussion with Gallagher Bassett retail experts from Loss Control, Operations and Account Management, the group shared their experiences for video use and retention that resulted in successful outcomes.  We provided best practice recommendations for the timeline on when a claim handler needs to secure video footage so that this value piece of evidence can be used in defense of slip and fall claims.


Changing Risk in the Age of E-CommerceIt is reported that in 2019 there will have been 224.1 digital shoppers in the United States and this number is projected to reach 230.5 million in 2021.  The increase in warehouse workload is changing the nature and mix of workers compensation injuries, impacting cost and lost time. Ecommerce creates a different level of liability exposure in shipping, product safety, and commercial auto.  This Industry Insight discusses how to assess the shift in your risk as your business model moves more into the e-commerce space.


Tricky Behavior is Not a Treat in Retail: According to the 2016 US Bureau of Labor Statistics “(This year) 16,890 workers experienced trauma from nonfatal workplace violence requiring day away from work.” Businesses also encounter unwanted behavior from customers who soon wear out their welcomes: the irate, those who overstay their allotted reasonable time, those who misuse bathrooms, and those who harass employees or customers. 

In collaboration with John Dahlberg, Partner, Dillingham Murphy, LLP, who represents California grocers and other retailers in a wide variety of subjects including how to stop trespass and common nuisance activities on either side of your doors we discuss the importance of finding practical ways to deal with unwanted behavior inside or outside of your stores.  Want to know more?  My co-author, John Dahlberg and I will be on a panel of retail experts exploring this topic in more detail at the 2020 NRRDA conference.  Click here to go to the website for more details and register today!


Thank you to all of our readers, for your feedback and interest in our topics, as well as my co-authors for your contributions to bringing your expertise to Gallagher Bassett’s Retail practice.  We look forward to bringing you information you can use to help your program in 2020!


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