THE FDA ON THEFT OF ETHICAL DRUGS
In a recent article published by the Department of Health and Human Services, the drug manufacturers and public at large were warned about the recent increases in cargo theft involving drugs and pharmaceutical ingestiblesTHE FDA ON THEFT OF ETHICAL DRUGS
By Erik Hoffer 5/10/10
In a recent article published by the Department of Health and Human Services, the drug manufacturers and public at large were warned about the recent increases in cargo theft involving drugs and pharmaceutical ingestibles. The volume of this type of theft has always been high, as these goods remain targets of organized criminal enterprises. Because of the lax laws against cargo theft and the almost non existent legal remedy afforded to victims through legal penalties for criminals or insurance, the best defense, states the article, is to prevent the theft proactively before you become a victim. By turning your attention to preventing theft, neither your company, the carrier or the public become exposed to the illegal distribution of ethical products or the possible exposure to mis-stored drug items. Theft spawns greater distribution of counterfeits and drastically affects both the bottom line of the victim company and carrier. No one is immune from theft nor can anyone insolate themselves from it. The best defense is a solid offense. Demand your carriers utilize technology such as the TS4A air brake locks, TS3A trailer glad hand lock and many other security devices for trucks, trailers, refers and containers. You can read the article by clicking the link below.
You can also read more about supply chain theft by in a book entitled SUPPLY CHAIN SECURITY published by Praeger Security International. This book was co-authored by Erik Hoffer, president of CGM Security Solutions Inc., a Florida corporation.
COMPLACENCY TO LOSS
By Erik Hoffer
10/7/09
In dealing with theft related losses for more than 40 years, I have discovered one amazing systemic fact that seems to defy logic in the trucking industry. That issue is simply that most trucking companies, whether involved with cargo logistics or construction exhibit complacency when dealing with the issue of theft related loss. Regardless of the economic impact of the theft to their business, to their clients ability to do business after a loss, or to the financial ramifications of truck and cargo theft has on the U.S. economy, most seem unwilling to proactively address theft as a business strategy.
Cost saving seems to be the order of the day in today’s market. With new business hard to come by and repeat business drying up, most logistic companies and independent truckers are becoming more aware of the impact of escalating expenses and reduced revenues in daily operations, rather than protecting themselves against theft. In considering how a theft related loss could impact profitability when compared to higher fuel costs or required maintenance items, one can easily make the case that everyday expenses or operational requirements are known where a theft loss is an unknown. Quantifiability of an expense vs. a theoretic potential theft loss, seems to define the reason for inaction. The truth is that both issues are significant and need to be addressed.
Insurance for instance is a required and quantifiable expenditure of all trucking companies. The liability against loss, damage, safety and other known and unknown perils is the basis for the expense. In the minds of many owners, this coverage addresses the threat base with a degree of financial remedy suitable for their needs. Some are exactly right, while most others are dead wrong. Cargo type, route selection, locations of clients serviced and other factors move the threat level higher or lower for any company and should be the criteria for selecting physical remedy against theft losses rather than embracing insurance alone as the sole solution or remedy. Insurance for instance does not cover employee infidelity losses, which is the most common cause of cargo theft. Simply put, if an employee is deemed culpable for the loss, you are simply not covered. If you are a shipper and your carrier does not have a level of liability coverage equal or greater than the net worth of your cargo, you too are at risk. If a carriers truck is stolen and used to perform an act of terror, the owner becomes completely culpable under the Patriot Act and would be responsible for all damages and remedial costs should that vehicle be used in this type of incident. If a stolen truck is involved in an accident the owner and his insurance carrier become responsible; and the award could be many times the coverage limitations of the policy.
The costs of loss drastically outweigh any simple mechanical remedy and need to be included in any business budget, regardless of the size of your operation. The smaller the company you are the greater the financial impact of a theft. The larger the company the greater impact brand erosion based on theft has on your ability to service larger clients. If you are a victim of loss as is so prevalent in pharmaceuticals, electronics, cosmetics and clothing, the more you should demand participation by your carrier is reducing the condition through a proactive security plan to harden your truck as a target. The fact that effective theft remedy in the form of a TS4a tractor air brake lock, which costs under $300 vs. any loss event, even being out of service for a few hours, costs the owner many times that amount. Shipper who find their carriers unwilling to participate should either search for a new vendor or consider supply these products to him to help protect your assets while out of your personal care and control.
Each remedy has its place and only prudent business decisions and corporate culture can decide if deterrents are beneficial in reducing losses. A simple pharmaceutical loss could cost your company millions. An accident involving your stolen vehicle could be the basis of a multi-million dollar claim; and in both cases any accident or theft loss could adversely affect your brand. In choosing to protect vehicles by the use of mechanical deterrent technology, not associated with GPS or electronics, any company can inexpensively harden their asset target against thieves. Theft losses can happen in an instant but typically involve unattended vehicles. With losses moving above $25 billion nationally each year, a prudent approach would be to consider the cost of loss vs. the cost or proactive remedy and of course choose the latter. By using air brake locks for tractors and trailers such as the TS4A and TS3A made by Rig Secure, you can not only save significantly on your insurance costs but save intangibly by protecting your assets from misuse and your client’s assets from theft 24/7.
No one is immune and no one can escape the problem by denial. Check out what works, discuss the use of these problems with your insurance under writer and start protecting your business and brand today.