The Risk of Theft in Asia

Risk of Theft in Asia – Loss prevention and supply chain security in a growing market.

The theft of property, both physical and intellectual, is one of the most significant risks of doing business in Asia. Intellectual property theft will be the focus of an upcoming article on this blog, however in this piece we’re going to explore the topic of physical asset theft.

Theft is Inevitable

Just as death and taxes are inevitable, theft in Asia is almost a certainty! Literally, anything and everything is likely to be targeted at some point: stock, cargo, construction equipment and plant, copper wire, fuel and manufacturing inputs are all regular targets.

Siphoning the Profits from Transportation and Agriculture

Fuel theft in Asia is often perceived as simply ‘the cost of doing business’ within the region, particularly for industries like transportation and agriculture. Some estimates place losses caused by theft at over 30 percent of a company’s total fuel bill. This ‘cost’ is staggeringly high, estimated at $560 million in Thailand alone, and a similar value over the border in Myanmar.

Generating Cash from Construction Equipment

Construction equipment is another popular commodity for thieves. The construction industry is surging, and when combined with low wage rates in the region, equipment theft is an increasingly attractive criminal act for some.

While small and reasonably inexpensive equipment such as tools and generators are vulnerable, even more so are mobile machines and larger plant. Among the most stolen heavy equipment are steer loaders, forklifts, backhoes and excavators due to their huge market value. Where theft of a whole machine is impossible, thieves have been known to target spare parts instead. This was highlighted in a recent case where two men in Singapore were arrested for stealing over S$1 million worth of excavator parts.

Warehouses and Cargo

Warehouses and secure cargo are also frequently targeted. In 2013, there was an average of 17.9 cargo thefts per month across the continent. Just as one example, consider the story of Sagami Rubber Industries, who lost a full container of goods (condoms) in Malaysia. In warehouses, consider the routine theft of copper cable from the electricity industry.

Whether it’s by criminals or an inside job by employees, supply chains are clearly vulnerable to theft. Not only is physical asset theft a reality, it can be opportunistic in nature; one day it might be a few items, another it might be a full shipment that disappears.

Asian Economies are Poised to Boom, and so are the Risks

Manufacturing and logistics are tipped to boom in the region and so losses caused by theft and similar incidents are also predicted to rise. Businesses seeking to trade or invest in the region should be aware of these risks and should take steps early in the process to prevent loss. Don’t be relaxed into thinking that your greatest risk of theft is from outside sources. SMCS Risk’s experience in loss prevention and theft tells us that even your most trusted executive or employee can be tempted to steal what is not theirs.

Conducting a thorough Loss Prevention Assessment is crucial to ensure that your organisation minimises the risk of loss by implementing proactive and necessary measures to protect business, assets, stocks and inventory.