Interviews
Worldwide thefts cost retailers US $104 billion annually - Survey
13 Nov '08
8 min read
The level of customer theft is increasing in North America and Asia-Pacific, where the percentage of customer shrink has increased 3.1% and 2.3%, respectively. In contrast, employee theft in Europe rose from 28.6% to 30.5% in this period.
Retailers reported that stolen merchandise accounted for 38.4% (or $14.6 billion) of internal fraud, while almost one-quarter (23.8%) of internal losses were in the form of stolen cash, coupons, vouchers or gift cards (more than $9 billion).
Current loss prevention systems and processes helped retailers apprehended nearly 5.3 million customer and employee thieves in 2007-2008, the majority of which (84.6%) were customers.
The average amount stolen or admitted per customer theft incident was $328. Employee theft sums were more than 5.6 times greater per incident, averaging $1,842. The total value recovered, including customer and employee theft, was $3 billion.
"The primary role of most Shrink Management Systems is to create a strong deterrence for theft by making the risk and reward analysis less attractive for would-be thieves," said Per Levin, President, Shrink Management Solutions, Checkpoint Systems. "People are used to a certain 'lifestyle' and will try to maintain it even if they lose their job or find themselves with a lower paying job due to the recession.
The reported $3 billion recovered from over 5 million individuals sends a strong deterrence message to society at large. In the next few years systems and processes will need constant improvements to increase the risk of detection for likely thieves."
Retailers in Europe and North America apprehended the largest numbers of thieves (2.8 million and 2.1 million, respectively), with North America reporting the largest percentage of employee thieves at 32.3%.
Refund frauds and false markdowns rose substantially, comprising 19.7% of internal fraud ($7.5 billion) -- an increase of 34% since last year. Collusion represented 10.3% of losses ($3.9 billion). Large financial frauds, also on the rise, accounted for 7.8% of internal fraud ($2.97 billion).
North America also reported the highest average dollar amount stolen by customers, at $747 per incident. The high average in North America is thought to reflect the impact of organized retail crime. Average amounts stolen per apprehension in other regions are much lower -- $108 in Europe and $35 in Africa, for example. However, in Europe the average amount stolen per employee thief was $3,145 (compared to $1,391 in North America). In Asia-Pacific, the average amount stolen by employees was $395.
"With the uncertainty surrounding our current climate, we believe the industry can learn quite a bit from the data revealed in this year's GRTB," noted van der Merwe. "We suspect the increase in organized retail theft uncovered in the study could be directly attributed to the downturn in our economy."
Retailers reported that stolen merchandise accounted for 38.4% (or $14.6 billion) of internal fraud, while almost one-quarter (23.8%) of internal losses were in the form of stolen cash, coupons, vouchers or gift cards (more than $9 billion).
Current loss prevention systems and processes helped retailers apprehended nearly 5.3 million customer and employee thieves in 2007-2008, the majority of which (84.6%) were customers.
The average amount stolen or admitted per customer theft incident was $328. Employee theft sums were more than 5.6 times greater per incident, averaging $1,842. The total value recovered, including customer and employee theft, was $3 billion.
"The primary role of most Shrink Management Systems is to create a strong deterrence for theft by making the risk and reward analysis less attractive for would-be thieves," said Per Levin, President, Shrink Management Solutions, Checkpoint Systems. "People are used to a certain 'lifestyle' and will try to maintain it even if they lose their job or find themselves with a lower paying job due to the recession.
The reported $3 billion recovered from over 5 million individuals sends a strong deterrence message to society at large. In the next few years systems and processes will need constant improvements to increase the risk of detection for likely thieves."
Retailers in Europe and North America apprehended the largest numbers of thieves (2.8 million and 2.1 million, respectively), with North America reporting the largest percentage of employee thieves at 32.3%.
Refund frauds and false markdowns rose substantially, comprising 19.7% of internal fraud ($7.5 billion) -- an increase of 34% since last year. Collusion represented 10.3% of losses ($3.9 billion). Large financial frauds, also on the rise, accounted for 7.8% of internal fraud ($2.97 billion).
North America also reported the highest average dollar amount stolen by customers, at $747 per incident. The high average in North America is thought to reflect the impact of organized retail crime. Average amounts stolen per apprehension in other regions are much lower -- $108 in Europe and $35 in Africa, for example. However, in Europe the average amount stolen per employee thief was $3,145 (compared to $1,391 in North America). In Asia-Pacific, the average amount stolen by employees was $395.
"With the uncertainty surrounding our current climate, we believe the industry can learn quite a bit from the data revealed in this year's GRTB," noted van der Merwe. "We suspect the increase in organized retail theft uncovered in the study could be directly attributed to the downturn in our economy."
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