Outsiders, Insiders and Theft
There’s obvious proof at retail establishments where losses—called shrinkage—falls into only a few categories ranging from shoplifters and employee theft to vendor theft and simple inventory confusion.
For example, just 30 U.S. retail companies lost over $5 billion to shoplifting and employee theft last year. And there was only 3.45 percent of those losses recovered, according to the fourteenth annual retail theft survey conducted by Jack L. Hayes International, a shrinkage control consulting firm in Fruitland Park, Fla. Says Jack Hayes, this means that for every one dollar recovered, another $27.95 is lost to retail theft.
“The losses continue to amaze us,” adds Mark R. Doyle of Hayes International, “While both the number of dishonest employees apprehended and the dollars recovered from those employee apprehensions finally leveled off after seven consecutive years of increases, our survey participants reported sizable increases in the number of shoplifters apprehended and the dollar recoveries from shoplifting.”
Employee ActionHistoric studies show that, while there are more shoplifting incidents, the per incident loss is relatively small compared with the per incident losses from theft of employees and executives at retail establishments.
Hayes says, “Shoplifting and employee theft continue to be costly crimes which negatively impact the bottom line profits of many retailers. The result of these crimes is higher prices for consumers at the cash register, and a loss of jobs for employees when retailers are forced to close stores or even go out of business.”
The survey reports on over 700,000 apprehensions that took place in 30 of the largest retail companies representing 12,833 stores with combined annual sales in excess of $419 billion. Some of the major results from this survey are:
The Numbers Don’t LieTotal dollar recoveries from both shoplifters and dishonest employees last year exceeded $182 million, an increase of 9.44 percent over 2000.
Survey participants apprehended 622,222 shoplifters, reflecting a 5.19 percent increase over pervious year shoplifter apprehensions (591,545).
Dollars recovered from shoplifting apprehensions totaled $70,954,254 last year, which is an increase of 9.32 percent over previous year recoveries ($64,905,425).
For the fifth consecutive year, the dollars recovered from shoplifters where no apprehension was made increased substantially over the prior year ($41,275,172 vs. $30,315,706, up 36.15 percent), after increasing 27.96 percent in 2000 and 23.45 percent in 1999.
Dishonest employee apprehensions (77,805 last year vs. 78,468 the previous year) and the dollars recovered from those apprehended employees ($70,221,185 vs. $71,494,974) decreased ever so slightly last year, after increasing the prior seven consecutive years.
On a per-company basis, one in every 27 employees was apprehended for theft from their employer.
On a per-person basis, dishonest employees steal approximately 7.9 times the amount stolen by shoplifters ($902.53 vs. $114.03).