In the modern age of retail, a National Retail Federation (NRF) study has found that inventory loss, due to crime or error, is having a $46.8 billion impact on the industry’s bottom line. The organization also noted that, on average, the shrink comes at a cost of 1.33 percent of sales to retailers, Forbes reported.
According to the survey from the NRF and the University of Florida, 41 percent of polled retailers noted a rise in their inventory shrink. At the same time, the average shoplifting incident cost rose to $559, as the average cost of return fraud reached over $1,750.
According to a study from FaceFirst, 20 percent of shoplifters, that are known, hit up three or more locations of a retailer. In addition, 60 percent of these known shoplifters visit at least two locations of a given retail chain. The report also noted that the top source of inventory shrinkage for four consecutive years was shoplifting.
Some technology companies are offering security networks to help chain retailers with this challenge. While each store discovers the faces and intentions of each organized retail gang with traditional video surveillance, every store in a geographic area can have that intelligence via network surveillance as soon as the gang hits the first store. In addition, the system itself can raise the red flag when gang members enter another store, with the help of biometric identification driven by artificial intelligence (AI).
In other cases, network security can help identify where a customer is making the rounds among local stores of the same chain. The customer might not be leaving stores with their pockets stuffed, but they might be up to something suspicious. DeepCam CFO Otto Lowe previously said that a strength of network security is being able to pinpoint these kinds of telltale behaviors.