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Loss Prevention Information - Retail Shrink Trends 2008-2011

It is known that shoplifting and other retail theft crimes have had a dramatic increase in the past few years, but the environment of theft has changed greatly. As we have discussed previously, the actual dollar amount per item stolen has not been necessarily increasing, but the quantity and frequency has. This is due to two main factors. The first being that there has been a large increase in theft among regular blue-collar individuals, both as employees and as customers. This demographic shift is indicative of the type of stores being stolen from also, where it is more common to see theft in a local Wal-Mart than in an upper-class imported jewelry store. As the economy remains muddled, people will continue to seek stores with better bargains, and thus items with a lower per-unit cost. Consequently, these stores increase product stock and exposure, which increases theft.

The second main factor is advances in technology which change the way some products are purchased, help to control inventory, and prevent shrink. The usage of technology such as affordable EAS tags or affordable high-resolution security cameras has had a dramatic impact on loss prevention. It has been shown that with these systems designed and utilized by a properly trained loss prevention team there is a quantifiable and definite reduction in retail shrink. Point-of-sale camera systems with centralized monitoring have also had a similar impact. These systems were simply not available or affordable in the past years, and have resulted in a major reduction in the theft of high-ticket items. Similarly, this is not the 1990s anymore. Big-theft items last decade were CDs and other forms of musical media. As the industry shifts towards a digital distribution medium, stores have reduced their media inventory and can focus on safeguarding a single end-cap of iTunes gift cards rather than rows of physical discs.

Despite technological prevention increasing, theft is still rising. As mentioned above, this is mostly attributed to the increase in theft of lower-priced items which receive less security attention. Staffing reductions, internal theft, and vendor fraud are all contributing factors as well. With less employees on the sales floor, especially in big box environments, amateur and impulse thefts are increasing. The traditional method of a meet-and-greet to ward off shoplifting is being defeated by a reduction in coverage. As some employees take wage-cuts or are hired at reduced wages, a mentality of stealing as an issue of compensation has been shown in recent studies. This is also compounded by the reduction in staffing, as with less employees there are fewer deterrents to prevent workers from theft. The lower number of workers also has lead to increasing workloads on managers and supervisors, which has given rise to a new level of vendor fraud. Over the past several years there has been an exponential increase in incidents of vendors either skimming units or simply charging for items not shipped. While it was previously feasible for stores to have a manager check each shipment against the invoice, this practice is becoming less practiced. Since there has been an increase in shipments of lower cost items, vendor shipment numbers have also been increasing, and the chances of auditing has been decreased.

Many stores who have no loss prevention system or who have their own internal loss prevention team have had trouble adapting to these changes. They make common mistakes such as simply trying to protect high-ticket items, not having effective security camera coverage, or having employees not briefed on maximizing their performance while having reduced staff. An outsourced loss prevention team, such as what West Coast Loss Prevention can offer, has been proven to reduce costs while decreasing shrink. With years of experience and a record of success, why not leave it to the professionals?

For more information on employee theft and our methods to combat it, Contact us today — Don't Become a Statistic.

Outsourcing Loss Prevention Saves You Money - Contact West Coast Loss Prevention - The Orange County California Loss Prevention Experts
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Shoplifting is a serious problem, and it's getting worse. 2011 saw an extreme increase in shoplifting, as more criminals and customers have taken to theft. Some businesses have been hit so hard that they are forced to close their doors. Retail theft is predicted to only to get worse in the coming years, and now is the time to act. Training and implementing your own shoplift program costs money and resources that your business needs. Studies have shown that out-sourcing your shoplift program can save you over 20% on costs. West Coast Loss Prevention by Tier 1 Solutions offers you not just a return on your investment, but decades of experience in loss prevention. Let us manage your program: We do it all for you!

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