Highlights from Two New USA Retail Theft Studies
NRF's National Retail Security Survey
The 2016 USA National Retail Security Survey (NRSS) is jointly conducted by the Dr. Richard Hollinger of the University of Florida and the National Retail Federation (NRF). This year's survey had responses from 80 retailers.
In 2015, the average overall shrink rate was 1.38% of sales which cost the USA retail economy $45.2 billion. For the grocery sector, retail shrink increased from 3.2% to 3.6%. Specialty men's and women's apparel shrink was at 1.2%. Discount, mass merchandise, or super center retailers shrink was at 1.1%.
This is the second year in a row where shoplifting theft was ahead of employee theft. Grocery saw a drop in shoplifting from 29.7% to 24.3%. Specialty women and men's apparel had a major 9% drop in shoplifting to 40.6%, but the number of losses attributed to employee and other internal thefts increased from 28.1% to 35.8%.
The average loss per shoplifting incident was $377, up $60 from 2014. The total number of apprehensions decreased 3.8% in 2015. Prosecutions dropped significantly by 29.4%. Grocery stores ranked higher than the overall survey in apprehensions.
The average loss from dishonest employee cases dropped from $1,546.83 to $1,233.77. The average number of employee apprehensions increased with groceries again leading the way (nearly 3X the group). Overall the survey indicated that apprehensions increased, but actions taken as a result decreased.
Overall LP budgets as a percent of sales were flat in 2015. For 12.3% of the respondents, budgets increased by 20% or greater. The total number of LP personnel per $1 billion in sales increased from 32.47 in 2014 to 37.5 in 2015.
"More sophisticated technology, such as POS data mining and CCTV are growing in popularity. Visible deterrent methods are also increasing."
Jack L. Hayes Annual Theft Survey
The second just issued retail shrink study is from Jack L. Hayes International. Twenty five large USA retail companies with 21,288 stores and over $700 billion in retail sales in 2015 participated in the research.
According to the Jack L. Hayes International 28th Annual Retail Theft Survey, the apprehensions of shoplifters and dishonest employees have increased in 9 out of the last 10 years. For 2015, over 1.2 million shoplifters and dishonest employees were apprehended in the 25 companies surveyed, up 2% from 2014.
For every $1.00 recovered, $19.61 was lost to retail theft. Only 5.1% of total retail theft losses resulted in a recovery.
From a trending point of view:
- 56% of the 25 surveyed companies had an increase in shrink. Twenty four percent had a decrease in shrink.
- 52% had an increase in shoplifting apprehensions.
- 56% had an increase in employee apprehensions.
Will We Ever Solve the Retail Shrink Problem?
Of interest from the latest retail shrink studies:
- The total loss of $45.2 billion in 2015 from the NRSS study is significant. Seventy five percent of the problem is with customer and employee theft.
- Employee theft is 3.3X the size of customer theft in the NRSS study. It is 4.6X in the Jack L. Hayes Theft Survey.
- The technologies choices to combat retail shrink are interesting. The industry trends indicate that much more needs to be done to aggressively address the growing problem.