Shoplifting: The Cost to Your Retail Business and What to do About it

Many times, shoplift­ing is dis­missed as mere­ly “the cost of doing busi­ness”. But, with slim prof­it mar­gins, shoplift­ing can be the dif­fer­ence between being prof­itable or not.
In the U.S. in 2016 the aver­age inven­to­ry shrink rate increased to 1.44%. The Cana­di­an num­bers are most like­ly very sim­i­lar. About 40% of the loss is from out­siders, 30% from employ­ee theft, the bal­ance of the loss is in admin­is­tra­tive errors and ven­dor fraud. The total cost to busi­ness is stag­ger­ing.
The most com­mon­ly stolen items include, clothes, books, music, jew­el­ry, watch­es, tires and car parts. Many asso­ciate shoplift­ing with bub­ble gum and can­dy bars, but much of it’s orga­nized gangs tar­get­ing mom and pop stores and retail chains.
Using anti-theft tags can help but does require an ongo­ing cost and an invest­ment in the mon­i­tor­ing tech­nol­o­gy. If you have not con­sid­ered video surveillance…you should. Tech­nol­o­gy has low­ered the costs and improved the qual­i­ty of cam­era sys­tems. Hav­ing a monitor(s) hung promi­nent­ly in your loca­tion can pro­vide a deter­rent as vis­i­tors will imme­di­ate­ly know they are being watched and record­ed. Sig­nage that tells vis­i­tors that there is mon­i­tored video sur­veil­lance can go a long way to pre­vent theft. A cam­era sys­tem that is record­ed also pro­tects you from inter­nal HR prob­lems. When employ­ees know the loca­tion is mon­i­tored, behav­iour tends to improve. It also can help pre­vent inter­nal theft.

Minimizing Shoplifting

But there are oth­er things you can do as well to pro­tect your busi­ness and reduce inven­to­ry shrink­age.
1. Your staff should greet cus­tomers as they enter your store. By mak­ing con­tact, it sends a mes­sage that your staff is engaged and inter­est­ed in the vis­i­tors’ activ­i­ty. This can deter a poten­tial shoplifter that wants to be anony­mous.
2. When cus­tomers avoid eye con­tact, seem ner­vous, linger, or exhib­it sus­pi­cious behav­iour, it’s impor­tant to engage them. Ask them if they require assis­tance. If it’s an actu­al cus­tomer they will appre­ci­ate the help, if not, they will like­ly find an excuse to exit the premis­es.
3. Encour­age your staff not to sit behind the counter, but to walk around the store, down all aisles.
4. A clean and orga­nized store sends a mes­sage that you are pay­ing atten­tion to your store. Keep­ing your shelv­ing in aisles low enough that you can see over them, and make sure you have ade­quate light­ing, no dark cor­ners.
5. Keep­ing ade­quate man­pow­er in your store is crit­i­cal. With only 1 per­son on staff, it’s easy to become dis­tract­ed by thieves pre­tend­ing to be clients. Make it a pol­i­cy to have stag­gered lunch breaks, to insure as many hands and eyes can be on deck at all times. A shoplifter is less like­ly to tar­get a well staffed store.
6. Keep com­mon­ly stolen and easy to steal items (small) in a high­ly vis­i­ble area such as the front of the store and or near the cashier.
7. Keep expen­sive inven­to­ry items in dis­play cab­i­nets that can be locked. Lim­it access to senior employ­ees.
8. Work­ing with your neigh­bour­ing busi­ness­es can also reap ben­e­fits. Have your employ­ees log sus­pi­cious activ­i­ty to share with their cowork­ers at shift changes and with neigh­bours. Work­ing togeth­er on video sur­veil­lance cov­er­age so there are no blind spots or cov­er­age gaps can also save mon­ey and increase your secu­ri­ty.
9. It’s impor­tant to draft an offi­cial com­pa­ny pol­i­cy on Shoplift­ing. It should be enforced and post­ed so cus­tomers and employ­ees are aware of it. Pro­vide staff train­ing on how to han­dle and pre­vent shoplift­ing sit­u­a­tions. Instruct employ­ees on how and when they should be call­ing for sup­port from secu­ri­ty or police and man­age­ment. Staff should feel safe.
10. If you have fit­ting rooms, keep the doors locked and require cus­tomers to see a sales per­son to gain entry. Lim­it the num­ber of items allowed into change rooms and record the quan­ti­ty tak­en inside. Post anti-shoplift­ing warn­ing sig­nage inside.
In the unfor­tu­nate event that you sus­pect some­one of shoplift­ing, exer­cise cau­tion. Your per­son­al safe­ty should always come first. Ask if you can help or ring up the order. Make a point to record a detailed descrip­tion of the per­son, and vehi­cle if rel­e­vant. Con­tact secu­ri­ty, your man­ag­er and police as nec­es­sary. If you have video sur­veil­lance, let the author­i­ties know and pro­vide them with the images.