ShopTalk: Practical answers for tough business questions

by : 
Kim Perkins
October 1, 2012

Question: We’ve had some inventory items go missing over the past few months. I did some detective work to try to find a plausible explanation and couldn’t come up with one. About two months ago, we got in a few beautiful watches with semi-precious stones from a new vendor. Within a week, one watch was missing from the case. Then, I went to a PTA meeting where I saw the sister of one of our employees wearing what appeared to be the exact watch. I was stunned and felt like I had been kicked. I did not say anything to the sister, and now I’m not sure what to do. Should I confront my employee or not?

Answer: I can empathize with your dilemma. If you decide to confront your employee, be aware no matter what the truth is (she took the watch or she didn’t), your relationship with her may deteriorate quickly. If she’s not guilty, she may feel wrongly accused and distrusted, even if you phrase it gently. If she is guilty, odds are she will react with indignation.

Sometimes I am considered a bit naive, but I lean toward trusting my employees and searching for another explanation. Just because it seems obvious (watch missing, employee has access, sister has watch), there are other possible scenarios, and until you are 100% sure, I would err on the innocent-until-proven-guilty side of the equation.

My advice, unless you’re ready for her to leave your employ, is to sit back and watch (no pun intended). In my thinking, you discovering this news was not a coincidence. Now that you have this information, ask Spirit to show you whatever else you need to know. If something is up, another incident will happen, and what you need to see will be made clear. Then you can take action and confront her if it is warranted.

In the big picture, it may be time to set some new policies about employees and merchandise. Do you have any safeguards in place that would eliminate the possibility of easily removing merchandise from your store? For example, are there always two people present at opening and closing? Is a manager needed to accept a return or void a sale? Do employee purchases need to be rung up with a manager? Setting new policies to deter loss is a good idea, absolutely within your bounds, and will send the message to all employees that you are aware and taking action.

Kim Perkins is co-owner of Elysian Fields Books & Gifts for Conscious Living (, an award-winning store in Sarasota, Fla. Send your retail questions to