Employee theft, shoplifting/organized retail crime and administrative error are the main sources of loss affecting retailers, according to an annual survey conducted by the University of Florida with a funding grant from Tyco Integrated Security (TIS), the industry’s security systems integrator, and Tyco Retail Solutions (TRS), global provider of retail performance and security solutions.
Employee theft, shoplifting/organized retail crime and administrative error are the main sources of loss affecting retailers, according to an annual survey conducted by the University of Florida with a funding grant from Tyco Integrated Security (TIS), a security systems integrator, and Tyco Retail Solutions (TRS), global provider of retail performance and security solutions.
The 2011 National Retail Security Survey found that retail shrinkage in 2011 was 1.4 percent, down from 1.5 percent from the previous findings in 2010. This calculates to an approximate $35.3 billion annual loss to retailers as a direct consequence of preventable inventory issues, with 44.2 percent attributed to employee theft, 25.8 percent to shoplifting and organized retail crime and 12.1 percent to administrative error.
"The decrease in retail theft indicates retailers are implementing effective loss prevention solutions in order to diligently protect their assets," said University of Florida criminologist Richard Hollinger, Ph.D., who conducted the survey. "The holiday season is an important time for retailers to evaluate their security solutions, and the growing adoption and awareness of better loss prevention strategies has continued in the recent trend of reduced retail losses and improved profitability."
According to National Retail Federation, 2012 holiday sales are trending to increase 4.1 percent to $586.1 billion, confirming retailers need to ensure their shrinkage is low in order to capitalize on increased sales. With improved technologies and a large number of consumers accessing retailers' inventories from multiple touch points, inventory visibility and accuracy is key for loss prevention this holiday season.
“With the holidays and 2013 planning in full swing, it's important for retailers to take a look at these statistics and evaluate security strategies accordingly,” said Michael Creedon, VP of Retail Sales and Operations at Tyco Integrated Security. “While theft is down this year, organized retail crime is on the rise and loss prevention solutions remain very important to help shrinkage continue to decline and operations run more efficiently and effectively.”
Creedon suggests retailers work with a loss prevention expert to analyze solutions over the holidays and create a tailored and effective plan leading into the New Year. TIS and TRS offer retailers security technologies, like their dual-technology tag, to help maintain a cohesive inventory visibility approach.
“As a total security solutions provider, we work with retailers to help confirm they have the right solutions and that they are using them in a way that maximizes their investment,” said Creedon. “Actively safe-guarding merchandise allows retailers to keep costs down and increase their ability to offer better prices to their customers, while potentially improving internal business practices.”