Security Dealer & Integrator

JUL 2018

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12 Security Dealer & Integrator / www.SecurityInfoWatch.com July 2018 Study Reveals Latest Retail Shrink Trends NRF says retailers are improving at controlling internal theft by using advanced technology Market Report / Retail SECURITY WATCH When it comes to downward trends, for retail shrink, it is a good thing. According to the 2018 National Retail Security Survey – conducted by the University of Florida in partnership with the National Retail Federation (NRF) and Appriss Retail – retail shrink decreased from $48.9 billion in 2016 to $46.8 billion in 2017. The survey, which polled loss pre- vention and asset protection profes- sionals from 63 retailers, also found that shrink averaged 1.33 percent of sales, down from 1.44 percent in 2016. In addition, 59 percent of retailers reported that shrink was flat or decreasing, better than the 51 per- cent in last year's survey; and only 41 percent said that shrink was growing. For the fourth consecutive year, external theft, which consists of shoplifting and organized retail crime, accounted for the majority of shrink losses (36 percent), fol- lowed by internal employee theft (33 percent), administrative paperwork errors (19 percent) and vendor fraud or mistake (6 percent). The most substantial losses for retailers per incident came via rob- beries, at an average $4,237.02 each (down from $5,309.72 the year before), followed by employee theft at $1,203.16 (down from $1,922.80) and shoplifting/ORC at $559 (down from $798.48). "For the first 21 years of this sur- vey, the internal threat of unscru- pulous employees stealing from employers beat out external crime," explains Bob Moraca, VP of Loss Prevention for the NRF. "That shows that retailers are getting better at controlling internal theft with training and advanced technology, such as video surveillance. (It also shows) we are still fighting external crime, which unfortunately is increasing." Retailers are losing less on average per shoplifting incident. In 2016, nearly half of retailers surveyed (48.9 percent) saw an average loss of $300 or more; in 2017, that dropped to 33.3 percent. "Retailers are putting less of those higher-end items on the shelf," Moraca says. "Instead of having them out on the sales floor so that people can steal them, they are putting these items in caged areas, behind locked glass or (other) techniques." Despite theft numbers trend- ing in the right direction, the sur- vey revealed areas of concern. An increasing number of retailers con- tinue to suffer from shrink rates well above the average. In 2015, the sur- vey found 17.1 percent of retailers had a shrink rate at 2 percent of their sales or more; however, that num- ber rose to 20 percent this year. The number of retailers who have expe- rienced shrink as 3 percent or more of sales has also grown substantially, from 5.4 percent to 9 percent. Security Tech Use Varies More than a third of retailers sur- veryed saw increases in loss prevention staffing and overall bud- gets, and they reported an increase in use of the following security-related tools and technologies: • Simulated, visible CCTV (41.3 per- cent, up from 14.3 percent in 2017); • Observation mirrors (22.2 per- cent, up from 12.7 percent); • Theft deterrent devices, such as spider wraps, keepers, etc. (41.3 per- cent, up from 33.3 percent); • Plainclothes detectives (30.2 percent, up from 22.2 percent); and • RF electronic security tags (30. 2 percent, up from 22.2 percent). Moraca says the uptick in the use of theft deterrent devices represents a positive development for loss pre- vention, as it demonstrates the tech- nologies have become more mature and effective in reducing theft. The retail loss prevention systems with the biggest decrease of usage in the survey include: • Cables, locks and chains (34.9 percent, down from 57. 1 percent); • Acousto-magnetic electronic security tags (22.2 percent, down from 44.4 percent); • POS data mining (57.1 percent, down from 76.2 percent); • Live customer-visible CCTV (54 percent, down from 73 percent); and • Merchandise alarms (20.6 per- cent, down from 36.5 percent). ■ BY JOEL GRIFFIN, EDITOR, SECURITYINFOWATCH.COM Read the full report: www.SecurityInfoWatch.com/12416575

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