Loss prevention in distribution and freight

Protecting your supply chain from internal and external threats

How secure is your supply chain?
In a world where goods are constantly on the move, the risk of loss in distribution and freight is higher than ever. Whether it’s theft, fraud, or operational mishaps, businesses are losing billions each year due to inadequate security measures.

Having worked in this industry for many years, I have seen businesses severely impacted by supply chain vulnerabilities, sometimes from blatant criminal activity, other times from weaknesses they never considered a threat. The good news? With the right approach, these risks can be significantly reduced.

So, what are the biggest threats? And more importantly, how can you prevent them?

Current threats in UK freight and distribution:

Rising cargo theft
Cargo theft in the UK has seen a significant uptick. In 2024, the UK recorded 5,370 reported incidents of heavy goods vehicle and cargo crime, with stolen goods valued at £68.3 million – a 7% increase from the previous year. (Hansard, UK Parliament)

Criminals employ various tactics:

Hijackings and armed robberies – Thieves forcibly seize control of trucks during transit or at unsecured stops.
Fictitious pickups – Fraudsters impersonate legitimate carriers using counterfeit credentials to collect shipments that never reach their intended destinations.
Warehouse burglaries – Inadequate security at distribution centres makes them susceptible to break-ins, especially during off-peak hours.
Cyber attacks – Hackers compromise logistics systems, altering shipment routes and accessing sensitive data.

The financial repercussions are substantial, with freight crime costing the UK economy an estimated £680-£700 million in 2023, accounting for lost revenues, VAT, and insurance costs. (Trans.INFO)

Internal theft and fraud

Internal threats are equally concerning. A report by Retail Economics revealed that 40% of retail theft is committed by employees, with theft at distribution centres accounting for 42.6% of total employee theft. (Retail Economics)

Common internal risks include:

Collusion with external criminals – Employees providing information to thieves about shipment schedules, security weaknesses, and high-value stock.
Inventory manipulation – Stock being falsely marked as ‘damaged’ or ‘lost in transit’ to conceal theft.
Unauthorised access – Employees entering restricted areas without permission, either to steal goods or facilitate theft by others.

Have you evaluated the robustness of your internal controls? If not, you might be inadvertently exposing your operations to significant risks.

Strategies to enhance security and minimise losses
Addressing these challenges requires a comprehensive approach that integrates physical security measures, operational protocols, and advanced technology.

Fortify warehouses and distribution centres

Perimeter security – Implement robust fencing, controlled access points, and barriers to deter unauthorised entry.
Surveillance systems – Deploy high-resolution CCTV cameras with real-time monitoring to cover critical areas, including loading bays and storage zones.
Access control – Utilise biometric systems, RFID keycards, and enforce strict visitor protocols to prevent unauthorised access.
Regular security audits – Conduct unannounced inspections to identify and address vulnerabilities proactively.

Secure freight during transit

GPS tracking – Monitor shipments in real-time to detect route deviations and respond to unauthorised stops.
Geofencing alerts – Establish virtual boundaries that trigger alerts if a vehicle strays from its designated route.
Tamper-proof seals – Use numbered seals to detect unauthorised access.
Driver vetting and training – Perform thorough background checks and train drivers on protocols to handle hijack attempts and security threats.

Consideration: RFID-enabled security measures
Radio-Frequency Identification (RFID) is an advanced technology that can enhance cargo security and tracking. RFID uses electromagnetic fields to automatically identify and track tags attached to goods, pallets, or containers. These tags store vital shipment data and can alert operators if cargo is tampered with or removed from a secured area.

RFID technology offers several benefits:

Real-time inventory tracking – Ensures accurate monitoring of goods throughout the supply chain.
Tamper detection – Some RFID tags can trigger alerts if broken or removed.
Automated security checks – Reduces manual inspections and human error.

While RFID implementation requires investment, its long-term benefits in reducing theft and improving supply chain visibility make it a strong consideration for loss prevention strategies.

Strengthen cyber security and fraud prevention

Two-factor authentication – Restrict access to sensitive shipment data through multi-step verification processes.
Encrypted communications – Ensure all data exchanges between logistics partners are secure to prevent interception.
Carrier credential verification – Implement rigorous processes to verify the legitimacy of third-party carriers to prevent fictitious pickups.

In an increasingly digital landscape, neglecting cybersecurity can lead to significant vulnerabilities.

Foster a security-conscious culture

Employee training – Regularly educate staff to recognise and report security threats, from suspicious activities in warehouses to phishing emails.
Whistleblower programmes – Create safe channels for employees to report unethical behaviour without fear of retaliation.
Incident response plans – Develop and communicate clear procedures for responding to thefts, data breaches, or other security incidents.

TAKE ACTION: Secure your supply chain today
The statistics speak for themselves, cargo theft and fraud are on the rise, costing UK businesses millions each year. The question is, what steps are you taking to protect your business?

Are your security measures strong enough to deter criminal activity?
Do you have a plan in place to combat internal theft and fraud?
Are you using the latest technology and best practices to protect your assets?

If you’re unsure, let’s start a conversation. Contact us today to discuss your current security setup, review potential vulnerabilities, and implement a proactive loss prevention plan.

Your supply chain is only as strong as its weakest link. Let’s ensure that link isn’t security.