Shrinkage is a pervasive problem for retailers, representing a substantial loss of revenue every year. Costing between 0.5% and 4% of sales every year, this phenomenon encompasses several distinct causes.
Causes of shrinkage in stores
Internal theft is one of the main causes of shrink. These are thefts perpetrated by employees themselves. Whether it’s the detour of goods, cash register manipulation or other forms of fraud, these acts have a considerable impact on company profitability. This type of markdown accounts for around 40% of a company’s shrink.
Shoplifting is another major cause of shrink. Unwary customers can easily conceal items and leave the store without paying, especially in the absence of adequate security measures. On average, external theft accounts for 55% of shrinkage.
Administrative errors include a range of problems such as pricing errors, incorrect cash register entries, and stock discrepancies due to human error or suppliers delivering less product. Although unintentional, these errors account for 5% of a store’s shrinkage.
How to effectively reduce shrinkage
Reducing internal theft and administrative errors is particularly difficult. Implementing rigorous internal controls, strict recruitment policies and ongoing employee training can help, but these measures require a significant investment of time. What’s more, these causes account for only 45% of shrink, so the most effective approach is to turn to shoplifting.
Shoplifting prevention is often simpler and more effective thanks to the use of specific technologies. Anti-theft gantries have proved to be a particularly useful solution. Installed at store entrances and exits, they detect items fitted with safety devices.
Explanations on the use of anti-theft gates
The
anti-theft gates
operate by emitting a magnetic, radio-frequency or acousto-magnetic field. Items are fitted with labels or safety devices that interact with this field. When a non-deactivated item passes through the gates, an alarm is triggered, signalling an attempted theft.
Accessories compatible with anti-theft gates include :
- Badges: often used for clothing, these tags are removed or deactivated at the checkout. There are also specialized badges for all types of items. They are removed with a detacher.
- Labels : used for small items, these labels can be deactivated by a deactivator at the checkout.
How much does an anti-theft gate cost?
The cost of anti-theft gantries varies according to the technology used. A basic system can cost 800 euros, while more effective shop-lock systems can cost several thousand euros.
William Vallet est le fondateur de TIH-Business, spécialisé dans tous les sujets liés aux affaires. Il est un entrepreneur à succès depuis plus de 10 ans et a créé plusieurs entreprises dans différents domaines. Sa dernière entreprise est le magazine TIH-Business qu’il a fondé avec l’idée d’être une publication indépendante qui fournirait des informations sur les affaires et l’entreprenariat pour aider les gens à créer leur propre entreprise.
