BLACKBURN company is at the heart of a new international drive to stamp out shoplifting.

The Distronics plant at Whitebirk is inserting a new generation of security tags into the music CDs it makes.

A pilot project run over Christmas and the New Year has proved so successful that Universal Music has ordered millions more of the high-tech crime-busting tags.

High Street retailers have been delighted with the trial source tagging programme, which included the use of five million tagging labels on chart-topping CDs such as Daniel Bedingfield, Sugarbabes, S Club Juniors and Kiss Smooth Groove.

They are now demanding the next phase of the scheme, which will involve highlighting the CDs destined to hit the charts in early 2003.

These high-risk titles have already been earmarked by UK retailers, so that a security label can be affixed to the packaging at the point of manufacture. If a tagged item is then taken past the pedestals at the retail store exit points, an alarm will be activated.

Dave Wilson, manager of the Distronics plant in Blackburn, which employs more than 300 people, said the concept was to help stores to sell more CDs without risking pilfering.

He explained that the new system allowed shops to have packaged CDs on display which helped encourage impulse buying.

He said the traditional method of retailing, whereby customers selected an empty case and asked assistants for the actual CD, was expensive in terms of staff time.

"It obviously makes more sense for security tags to be inserted as part of the packaging process," he said. "It makes purchasing CDs in stores a more open experience. "

The Distronics factory in Blackburn was once part of the giant Philips group, but is now owned by Universal. Staff manufacture up to 400,000 CDs every day, seven days a week.

Sensormatic, now part of the ADT family, has been working in partnership with Universal Music UK for the last two years, in a bid to tailor a security solution that meets all the industry requirements, from labels suitable for clear box goods, to ensuring effectiveness with security pedestals on wide or restricted exits.

The company is working with HMV, Borders, WHSmith and other top retailers to ensure that goods are source-protected - where goods are security tagged before they leave the

manufacturers - in a bid to stem retail industry losses of £830 million a year from theft.

Source Protection also has major cost benefits for retailers, as security tagging can cost much less per CD to install than other CD security solutions. It also offers an even greater deterrent to theft as customers and staff are not aware of which products are tagged or where the tag is hidden, resulting in reduced shrinkage and increased profitability for retailers.

Brian Cottrell, WHSmith crime prevention specialist for WHSmith, said: "It's particularly important to discourage shrinkage in the more popular theft-prone lines, such as music CDs and DVDs. This technology will be extended to more of our product lines. I firmly believe source tagging is the answer to entertainment security of the future."

Colin Culleton, head of risk management at HMV, added: "HMV remains committed to providing an outstanding range of product and excellent customer service.

"This can only be achieved within a self-service environment in our experience. However, to ensure the profit contribution is not eroded through customer theft requires significant investment in loss prevention systems and personnel.

"To date, support for retailers from music suppliers in tackling shop theft has been non-existent. We therefore welcome Universal's programme."