FAYETTEVILLE — Business researchers at the University of Arkansas have teamed with a leading retail trade association to examine the potential for theft and fraud in emerging consumer technologies, the university announced Tuesday.
The partnership of the UA Walton College of Business and the Retail Industry Leaders Association will evaluate risks posed by such technologies as mobile coupons, touchless payment and mobile self-checkout, officials said.
The project will also identify and evaluate possible loss-prevention strategies.
John Aloysius, associate professor of supply chain management at the Walton College, said retailers are quickly adapting to wired, self-sufficient customers seeking convenience. He said perhaps a majority of the nation’s leading retailers are gearing for pilot programs involving systems other than fixed checkout points.
Variations range from an associate walking around a store who can check out a customer at any point using an iPad to customer self-checkout using a cell phone, Aloysius said.
"Fraud and theft are not the only issues here," he said, noting potential problems with scanning or payment delivery. "The thing is for customer convenience. But then, there are operational difficulties. (The systems) rely on accurate record-keeping. If there’s a mistake, they’ll lose the sale but their inventory records are now incorrect, and there are a lot of cascading things that can happen."
The work contemplated in the study is "the cutting edge of loss prevention," said Viswanath Venkatesh, professor of information systems at the university
Aloysius said he and Venkatecsh will compile their findings, drawing largely from data from members of the trade association, in an industry report by next summer and then build a risk-assessment checklist that retailers can use at store locations to mitigate theft-related risks.
"We need to get out in front of this emerging trend now to position ourselves so that we can proactively address the challenges that lie ahead rather than reacting to challenges once these emerging point-of-sale technologies become the norm," said Lisa LaBruno, vice president of loss prevention and legal affairs at the association.
LaBruno said the project holds significant potential value to the retail industry. Aloysius said the research is supported by a $107,500 grant from leading professional services organization Ernst & Young and Checkpoint Systems, a leader in retail security, loss prevention and other industry solutions.
Members of the Retail Industry Leaders Association include more than 200 retailers, product manufacturers and service suppliers, which collectively account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers domestically and abroad.