Retail Shrinkage: Your #1 Holiday Security Concern
Retail Shrinkage: Your #1 Holiday Security Concern
The holidays are a productive time for most retailers, as they’re now projected to bring in between $979.5 - $989 billion this season alone.
However, shrinkage may cause retailers to lose a large portion of the profits they expected to make. Recently surveyed retailers reported experiencing a 93% increase in the average number of shoplifting incidents and a 90% increase in dollar loss due to shoplifting within the same period. Additionally, retailers often struggle with how to appropriately address shrinkage while maintaining a positive customer shopping experience – ultimately stopping them from maximizing their profits.
What is retail shrinkage?
Retail shrinkage is when a retailer loses inventory for any reason other than sales, causing a discrepancy between the inventory list and the actual number of products in stock. Causes of shrinkage include theft, fraud, human error, and substandard workflow processes.
How common is retail shrinkage?
Retail shrinkage has contributed to nearly $100 billion in lost revenue for retailers in recent years. This can partially be attributed to the rise of increasingly sophisticated organized retail crime rings. For reference, 62% of surveyed retailers state that two to three individuals working together to steal multiple items is more of a concern than it was a year ago and 47% of retailers have also seen an increase in groups of more than three individuals working together to steal multiple items.
Retail shrinkage also puts employees in danger because some employees may choose to intervene, which can lead to damages, inury, or worse if the suspected individual responds with violence against the employee.
Recent data shows that 73% of surveyed retailers have experienced shoplifters that are more violent and aggressive than they were a year ago and 84% of retailers state that violence during a crime has become more of a concern within the last year.
How to address retail shrinkage?
Solutions to shrinkage include adopting physical security measures, like uniformed security or law enforcement, within prioritized high-risk locations or around high-theft product categories. Other popular interventions include:
- Adding measures to lock up/ secure merchandise from theft
- Reducing in-store product selection
- Reducing store hours
- Closing store locations
Flock Safety’s LPR cameras also work to minimize shrinkage by creating an invisible security perimeter around a store to capture all vehicles coming and going. Signage signaling the presence of Flock Safety’s cameras also serves as a deterrent for any would-be criminals looking to target your retail location.
For example, San Francisco Bay Area retailer Friedman’s Home Improvement experienced a 23% reduction in their shrinkage after installing Flock LPR cameras on their premises. In fact, Friedman’s was able to solve a major theft case using data from Flock’s LPR cameras. After a suspect stole $3,000 worth of merchandise from a store, the Safety team was able to use Flock to identify the suspect’s vehicle and get its license plate data, enabling law enforcement to help them recover the stolen goods.
Want to learn more about how Flock Safety can address your retail shrinkage issues and save you money?
Schedule a demo today to see Flock Safety in action for yourself and discover how it can help you create a safer, more secure retail environment this holiday season.
