Retail theft of $2.4 billion targets fashion and electronics, but it’s the good guys who are paying

Lingerie, fashion accessories, high value electronics and even satellite navigation devices are favoured by retail thieves, according to Euromonitor International’s Global Retail Theft Barometer for 2012-13.

And they are helping themselves to mountains of goods, with an estimated $2.4 billion worth of items stolen in Australia in 2012.  

Customer theft accounted for 45% of the losses, costing $1.086 billion to the retail industry. Employee theft made up 27%, $652 million, of the total loss. Supplier fraud accounted for 7% of the loss, at $169 million, while in-house administrative errors and non-crime losses accounted for 21% at $507 million.

Other categories targeted by thieves include consumer health products, electronic games and mobile device accessories.

Across 16 countries surveyed, it was found around $109 billion was lost to shoplifting and employee crimes or administrative errors in 2012.

However, the estimate appears low compared to figures from the National Association for Shoplifting Prevention and the Australian Retailers Association, which estimate the cost of shoplifting to the Australian retail sector is around $7.5 billion per year, with over $25 million worth of stock stolen every day.

The Euromonitor International’s Global Retail Theft Barometer report found that the theft levels mean Australian households are paying the second highest ‘honesty tax’ of the countries in the survey.

This ‘honesty tax’ was calculated by the price increases made by retailers to compensate for retail loss, resulting in $290 for each Australian household. The amount was slightly higher than the United States at $296, and above Belgium at $253 per household.

Checkpoint Systems Australia funded the report. Its managing director for Australia and New Zealand, Mark Gentle, said this year internal security had improved, but customer theft was still an issue.

“The lower employee theft rate has been a result of the focus retailers have had on staff training and security solutions such as radio frequency electronic article surveillance (EAS), making it more difficult for staff to steal from their place of work,” he said.

“Now we are seeing an increase in the rate of shoplifters meaning that some retailers will need to revaluate security measures and look at new security technologies that are emerging.”

He said it was important for retailers to recognise that loss prevention is “not one single issue”, in order to best reduce shrinkage.

“There is a need to work collaboratively to combat shoplifting, employee theft, vendor loss and administrative errors all at the same time,” he said.

The results come as retailers surge into the Christmas period, with pre-Christmas retail sales across Australia tipped to reach $42.1 billion, up 3.3% on 2012 figures.

Product areas tipped to do well include food, up 3.2% to $17.334 billion, apparel up 6.2% to $3.225 billion and household goods up 2.8% to $7.017 billion.