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Loss Prevention

Global Retail Theft Barometer

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Retail employees out-steal shoppers in North America, where total shrinkage amounted to $45.3 billion in 2011, according to the Global Retail Theft Barometer generated by the Centre for Retail Researching in Nottingham, England.

Employee theft accounts for 44.1 percent of retail shrink in North America, while customer theft — including shoplifting and organized retail crime — is responsible for 43.2 percent, says Dr. Joshua Bamfield, director of CRR and author of the study. The total cost of theft amounts to 1.45 percent of sales, according to Bamfield.

The Global Retail Theft Barometer noted that the amount of money spent on LP and security totaled $28.3 billion worldwide last year, a 5.6 percent increase from 2010.

“Of the top 50 global retailers who responded to the survey, the ones which reported a decline in shrink from the previous year did not construe LP merely as a matter of theft, but worked across their operations to systematically combat shoplifting, employee theft, vendor loss and administrative errors,” Bamfield says. “Ninety-six percent of these retailers’ stores used audit programs to monitor the use of LP policies and, above all, the retailers increased their LP spending almost twice as much as the global average.”

Highest average shrink rates (1.87 percent) are found in the apparel/clothing, fashion and accessories classifications, followed by health and beauty aids/pharmacy (1.79 percent). Shrink for such cosmetics items as mascara, eyeliner and eye shadow increased 30 percent to 2.14 percent; in apparel, outerwear shrink increased 15.3 percent to 2.94 percent.