How merchandise security works

Functionality of Merchandise Protection

Merchandise Protection for the Textile Sector

In the area of merchandise protection for the textile trade, we serve all concepts and customer sizes with the best quality. 

We assist you in planning merchandise protection and help you prepare all necessary craftsmanship. Did you know that the criminal police advisory center in Hamburg still offers free training for retailers on the topic of "Merchandise Protection and Prevention"? Almost all other federal states have long since discontinued this service for cost reasons. Eastek Systems supports this through product training and demonstrations.  

There are two different systems for the use of merchandise protection in the textile trade: 

1.Radio Frequency Merchandise Protection  (RF)

Advantages:  

  • More cost-effective than AM systems 
  • Many manufacturers 
  • Many designs 
  • Very large selection of security tags

Disadvantages: 

  • Range smaller than AM Acousto-Magnetic Merchandise Protection 
  • Rarely can be synchronized with neighboring systems (coordinated), which may lead to technical limitations 
  • More sensitive to radio interference 
  1. Acousto-Magnetic Merchandise Protection

    Advantages:  

Typical entrances in retail are about 2m wide with inward-opening doors. With AM (acousto-magnetic technology), the merchandise protection antennas can be placed behind the doors, on a passage width of about230cm and function perfectly there 

With the installation of the merchandise security by trained technicians and reputable providers, there are rarely disruptions and a flawless  operation for many years 

Many designs are available for the merchandise security antennas: Plexiglass, aluminum, mounts for advertising media, etc. 

       Disadvantages: 

A larger range between the antennas also means greater detection into the store, thus more distance to secured goods (possibly use dummy security devices)​

 

Merchandise security and the leasing trap 

You want to lease a merchandise security system to use your money better than tying it up in a security system.

Basically a good idea, as often you can achieve more with free capital than the interest incurred by the leasing bank.

In addition, you can immediately account for the lease payments as an expense and simultaneously have a low inventory discrepancy due to the goods protection.

Under certain circumstances, terms such as 36 months or 48 months are attractive, but there are also regulations regarding leasing that are rarely clarified.

Many of our competitors are pleased with a leasing contract, as the money is received immediately from the leasing bank, often plus a commission, and what happens later is initially irrelevant to the seller.

 
Full amortization leasing for your goods protection

The leasing contract must be concluded for a specific period and cannot be terminated during this time if both parties fulfill the contract properly (no right of termination).

This is known as the basic rental period.

During this basic rental period, the lease payments of the lessee must at least cover the acquisition/production costs as well as ancillary costs including the financing costs of the lessor.

According to these two leasing decrees, the decisive criterion for the tax allocation of the leased object is the length of the basic rental period:

If this is between 40% and 90% of the usual useful life of the leased object calculated according to depreciation, it will be attributed to the lessor. 

The lessee can then deduct the lease payments as business expenses.

Depreciation for goods protection 12 years = 144 months x 40% = 57.6 months minimum term, if the tax advantage is to be utilized.

For all goods, there are depreciation periods (AfA = depreciation for wear and tear); for the goods security system, the tax office indicates a useful life of 12 years, and the depreciation would need to run for this period.

In leasing, 40-90% of this time must be fulfilled:

12 years = 144 months x 40% = 57.6 months minimum term

12 years = 144 months x 90% = 129.6 months maximum term

Note, our consultations do not replace legal or tax advice, but it helps to ask!