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More shrink in retail: what can you do to stop it?

Shrink, comprised of shoplifting, employee or supplier fraud and administrative errors, rose in the U.S. from 1.28 percent of sales in 2013-2014 to 1.97 percent during 2014-2015, based upon responses from common retail respondents who participated in Global Retail Theft Barometer surveys both years. Globally, this compares to 1.42 percent, a figure also up from the previous .94 percent average of all common retailers surveyed the previous year.

Retailers expressed that a range of factors, including a challenging retail environment, caused them to implement austerity measures resulting in a reduction of loss prevention investments. This, combined with areas of high unemployment and limited tools to monitor internal theft and inventory discrepancies, all contributed to an increase in their shrinkage.

The study was carried out 2014-2015 by The Smart Cube and Ernie Deyle, a retail loss prevention analyst. It was based upon in-depth phone and written survey interviews conducted in 24 countries among more than 200 retailers representing nearly $1 trillion in sales during 2014-2015.

Seasonal Comparisons

Seasonally, U.S. respondents said that 46 percent of their yearly losses occurred in winter, nearly twice as much as the next season, autumn, at 24 percent. Spring (18 percent) and summer (12 percent) followed.

Vertical Retail Comparisons

U.S. apparel specialists (2.28 percent), pharmacies/drugstores (2.25 percent) and non-grocery retailers (1.9 percent) witnessed the highest shrink rates because of the widespread prevalence of internal and external retail theft targeting their merchandise.

Most Stolen Merchandise

Shoplifters and dishonest employees in the U.S. primarily targeted small and easy-to-conceal items such as liquor, mobile accessories, batteries, fashion accessories and razor blades, as well as high-value items with high resale value, such as tablets. When sorted by retail vertical, the most stolen items included footwear (Apparel and Fashion Accessories); batteries (DIY Home Improvement); mobile device accessories (Electronics); wines and liquor (Food and Beverage); and razor blades (Health and Beauty).

According to Deyle, “This year’s results highlight the persistent factors that impact shrink and ultimately reduce retailers’ profitability. Even if retailers are paying more attention to all aspects of the problem, without a strong investment in loss prevention tactics, tools and resources, they won’t get the results they’d expect. Our hope is that this report helps the industry better understand all the complexities of the shrink problem as well as the most cost-effective ways of addressing it.”

“This is our fourteenth year of supporting what continues to be the industry’s only global statistical research,” said Per Levin President of Merchandise Availability Solutions, Checkpoint Systems. “To combat increased shrink, retailers are adopting strategies to approach losses from a wider perspective from all levels within the organization and work with their supplier and solutions partners. With the right technologies, people and processes, they can achieve improved merchandise availability, which directly impacts shoppers’ satisfaction and retailers’ profitability.”

Loss Prevention Measures

During the latest reporting period, U.S. retailers that also participated to the study in 2013 reduced their overall loss prevention spend to 0.50% of sales, which contributed to the reported increase in shrink. Most common loss-prevention store solutions included CCTV/DVR (83 percent), alarm monitoring (78 percent), and security guards (63 percent). Most common merchandise protection solutions deployed to prevent retail theft included Electronic Article Surveillance (EAS) (68 percent), spider wraps/security keepers (41 percent) and advanced inventory control tactics (27 percent).

How can Gripzo help?

According to the Barometer, mobile devices such as tablets are at a high risk of being stolen. Gripzo has the best technology out there to keep your mobile devices safe. Gripzo offers security fixtures or enclosures for android or apple tablets in any dimension. Gripzo locks them down in 3 seconds and releases them in 3 seconds. This keeps the tablet mobile. Anti-theft protection of tablets is fast and easy for retailers, offices, hotels, industry or any other facility using tablets.

Gripzo’s security brackets for smartphones are ideal for high risk stores. High quality, forged steel grips make theft as good as impossible. The anti-theft brackets are available in white and black. The ROI of the security clamps is unmatched as no electronics are used so maintenance is as good as non-existing. Showing smartphones to provide a true product experience to retail customers is done by authorised staff with the quick release option. This way, customers can experience their future phone without sensors and cables. Sales staff get valuable talk time with the potential customer. This is how mechanical anti-theft security systems can work for you as an electronics retailer,