Though retail theft rates in 2011 decreased, recent survey data finds retailers are still grappling with a multi-billion dollar problem.
Preliminary results of the latest National Retail Security Survey show that retail shrinkage -- a loss of inventory due to employee theft, shoplifting, paperwork errors, or supplier fraud -- decreased to 1.41 percent of retail sales in 2011 ($34.5 billion) from 1.49 percent in 2010 ($37.1 billion).
The survey is a collaborative effort between NRF and the University of Florida.
“Retail theft continues to plague the industry, with billions of dollars of merchandise walking out of the store every day without ever being paid for,” said NRF Vice President of Loss Prevention Rich Mellor. “Fighting these self-serving and unethical criminals has been a tedious battle, but we remain resolute in our efforts and our partnerships with law enforcement to combat this growing problem.”
Although overall shrink rates have decreased, when it comes to organized crime, retailers are seeing a rise in activity. NRF’s recently released Organized Retail Crime survey found that 96 percent of retailers have been victimized by organized retail crime over the last 12 months.
According to the preliminary survey findings, the majority of retail shrinkage last year was due to employee theft, accounting for 43.9 percent of total losses. Additionally, shoplifting accounted for approximately 35.7 percent of total losses, up from just over 32 percent last year. Other losses included administrative error (12.1% of shrinkage) and vendor fraud (5.0% of shrinkage). Retailers said that the cause of the remaining shrinkage was unknown.
The National Retail Security Survey is an annual survey of loss prevention executives that benchmarks retail shrinkage and operational information about how retailers are combating losses.
The study, which surveyed 100 retailers in the first half of 2012 and uses data from 2011, is the result of a partnership between the University of Florida and the National Retail Federation.