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Consumers pay the price of retail theft
It is a well-known fact, shoplifting is a global problem. Everyday people walk out of stores with items that are not legally theirs. It happens everywhere, regardless of nationality, income or indeed, perceived social standing. Retail theft is a worldwide epidemic that shows no sign of abating. And nowhere is it more apparent than in the UK writes David Nuttall, Managing Director, Checkpoint Systems, UK.
New global research found that during the last year, store crime cost UK retailers a staggering £3.9 billion as the country continues to rank the worst in Europe. Checkpoint Systems' Global Retail Theft Barometer (GRTB), conducted by the Centre for Retail Research across 32 countries worldwide, found that retail theft costs every UK household £150 in tax per year compared to £194.01 in the USA and an average of £115.18 in Europe. So, it's not just retailers who absorb these costs. Innocent consumers end up paying the price for the selfish behaviour of a small proportion of the population.But why is retail crime so high in the UK? The answer is uncovered in this report. In 2007, the UK's security spend dropped drastically by 22 per cent to £769 million. All very well, but link that to the fact that 38.5 per cent of most stolen items identified in the report are still unprotected, and therein lies a clear correlation between investment in protection and shrinkage levels.
The drop in security investment over the past year has clearly had a detrimental effect on the level of protection and, as a consequence, on retailers' profit margins and consumer's pockets. Advances in secure technology and solutions have increased protection for retailers, however, it is shocking that so many stolen items still remain unprotected. Retailers must put the investment where their mouths are as there is a clear link between spend on security and shrinkage.
Indeed, in the competitive retail industry, loss from theft can significantly affect a retailer's financial performance. Securing stock is vital and using integrated technology security solutions is the best method to effectively ensure protection. This is recognised by some retailers, with a third of loss prevention budgets focused on 'smart' technology solutions.
Electronic Article Surveillance (EAS) continues to be the most common and important method of protection utilised by retailers to drive down shrinkage, and is currently used on an average of 34.8 per cent of vulnerable product lines. These include video games, DVD's, razors, spirits and trousers. Source tagging has also continued to grow in importance, with 39.7 per cent of European retailers recognising the benefits of this advanced technology. These multi-function solutions not only protect retailers from external shoplifting but also the increasing threat of employee theft, which currently accounts for 34 per cent of all shrinkage, at a cost of £1.3 billion.
As with all systems, an integrated approach is required for guaranteed success. So, if technology is utilised to its full potential, retailers could save themselves millions of pounds, which will go a long way towards strengthening their market position and helping to ensure that shoplifting statistics do not continue to rise and ultimately eclipse sales figures.
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