Launched at Retail Risk – London, the risk and loss prevention conference in April, the UK Retail Fraud Survey 2016 – sponsored by WIS International – has found that UK retailers lost £2.34 billion to shrinkage in 12 months. Employee theft was identified as the single biggest cause, with 68pc of retailers citing it as their top area of loss.
Published by Retail Knowledge and sponsored for a second year by WIS International, an inventory and data collection services company, the survey covers retail transactions accounting for some 32pc of all UK retail sales online and offline through 34,950 stores across the UK.
Shrinkage rates vary by retail sector from mass merchants and department stores at 2.68pc of sales to a low of 0.25pc of sales for hospitality and leisure retailers. However, mass merchants and department stores have seen an increase in shrinkage rates since last year of 58pc whereas hospitality and leisure retailers have seen a decrease of 38%.
Paul Bessant of Retail Knowledge says: “Over the past few years the retail landscape, with the advent of omni-channel retail, has changed beyond all recognition, and with it, so has Loss Prevention. The nature of threats with which the LP department is now expected to deal has changed too. With this redrawing of the lines of risk comes increased responsibilities for those who traditionally confined themselves to a narrower LP function, as well as greater opportunity to support and contribute to the business. The signs are that these new approaches are working well, as you will see by this year’s shrink figure and the Survey on the whole. However, it is also clear that there is no room for complacency.”
Steve Simmonds of WIS International adds: “I know from my conversations with retailers that the value placed on this information is very high. The survey provides a unique insight into what issues are emerging in the world of retail risk and loss prevention and allows retailers to both benchmark their own performances as well as prioritise areas where others are already being challenged and they may well be too. It also allows those who supply solutions to the risk and loss prevention market to better understand where challenges are being posed, and to help produce solutions most relevant to a constantly evolving market place.”
