Retailers have a systemic problem. They know that a percentage of the people walking into their stores are there solely to steal. But with full knowledge, they still welcome all as if they will be paying for their purchases. They also know that unbridled access to goods leads to higher sales, but allowing that also creates a gateway for higher theft.
Retailers also know, however, that every dollar they preserve through the utilization of loss prevention (LP) programs will float gracefully to the bottom line. They won’t need to ship it, inventory it, stay open late to sell it, or mark it down to turn it over. That’s exactly why the cost of shrinkage is so high to retailers, and why they are willing to spend up to 5 percent of their gross sales to limit it.