Retailers face more challenges than ever concerning loss prevention. The most recent statistics show a shoplifting spike, often done by repeat offenders and organized retail crime (ORC). Statistics show that 75 percent of shoplifters are adults and retailers lose an estimated $30 billion annually through ORC.
This upward trend in crime statistics related to shoplifting and theft has led to an increased demand for experts in loss prevention. A loss prevention manager is essential to any retail operation, helping stores deal with “shrink.” The term refers to inventory loss through theft or accident. The causes of shrink include shoplifting, theft by employees, administrative mistakes, and fraud committed by customers returning items.
A loss prevention manager focuses on combating the rising tide of theft at retail establishments. Given the trend in ORC and theft, it’s a job with more challenges than ever.
Shoplifting Has Become A Common Occurrence
The most recent statistics on shoplifting are staggering. The Retail Industry Leaders Association released a study that offered the following numbers.
- Criminals stole an estimated $68.9 billion worth of products from retailers in 2019
- Retail crime results in $125.7 billion in lost economic activity and the loss of 658,375 jobs. These jobs pay a cumulative $39.3 billion in wages and benefits to workers
- Retail theft costs federal and state governments about $15 billion in personal and business tax revenues (this number does not include lost sales taxes)
- About 67 percent of loss prevention managers who work for major retailers reported moderate to considerable increases in ORC, while 80 percent predicted it would get worse in the future
The most frequently stolen goods include fashion items; arts, crafts, and gifts; homewares; electronics and music; books; sports-related items; musical instruments; collectibles and antiques; and toys and baby items.
New Challenges Arising in Loss Prevention
The shoplifting statistics increased during and after the worst months of the COVID-19 pandemic. For example, Loss Prevention Magazine (LPM) reports on a survey that found increases in the per-case amount involved in shoplifting (a 26.6 percent increase) and employee theft (a 22.6 percent).
LPM also reported that challenges are multiplying. The growth in online retailers has given ORC operations a place to sell stolen goods. One global case involved a more than $50 million ORC operation that targeted over-the-counter drugs and health and beauty products, which thieves resold online as a third-party seller.
Industry surveys also have found a surge in threats made to retail store associates and actual violence against them in some cases, LPM reported. Managers at leading retailers said that they are now prioritizing defending against violence and shooting incidents, cyber-related incidents, internal theft, gift card fraud, and return fraud.
How Loss Prevention Mitigates The Risks of Shoplifting
Retailers face inventory shrink from many different places. For example, 47 percent of high school students say they have shoplifted at least once. And the average amount lost in a shoplifting incident is $559.
Loss prevention managers make a difference. Their work involves every aspect of a retail operation where the potential for theft occurs, either from an external or internal source. They work to strengthen computer systems against hacks and create policies limiting access to sensitive information. They oversee performance audits to ensure store goods are handled correctly. Loss prevention managers strategize the best security measures to lower the risk of shoplifting.
They also recommend appropriate technology. For example, adequately implemented face recognition software can reduce theft by as much as 34 percent, partly because 60 percent of shoplifters visit multiple locations of the same retail chain.
NMU Global Campus Loss Prevention Management Degree
NMU Global Campus offers an online Bachelor of Science in Loss Prevention Management degree program led by an experienced faculty in loss prevention. Students in the program learn about current significant threats in ORC and shoplifting and the advanced methods used to combat them. For example, the program teaches graduate students how to use analytics to make data-driven decisions in loss prevention.
The 100% online program gives students the flexibility to earn a graduate degree while working a full-time job.
Loss prevention management is a challenging, rewarding job that will remain in high demand in the coming years. A BS in Loss Prevention Management can provide a key step toward establishing a successful career in this growing field.