Australian and New Zealand retailers have lost more than $11.85 billion to thieves during the past four years, says the fourth annual edition of the Global Retail Theft Barometer.
The study, sponsored by an independent grant from Checkpoint Systems, monitored the costs of shrinkage (loss from shoplifting/employee crimes and administrative errors) in the global retail industry between July 2009 and June 2010.
It found that shrinkage decreased for the first time in all regions surveyed. Shrinkage in Australia and New Zealand over the last 12 months decreased by 7.3 per cent to 1.39 per cent of total sales, or $2.892 billion, after three years of growth, peaking with shrink of 1.5 per cent in 2009.
Mark Gentle, managing director for Checkpoint Systems in Australia, said the sharp rise in shrinkage in 2009 had evidently placed loss prevention issues high on the agenda of the major retail corporations with beneficial results in 2010.
"Retailer spending on loss prevention and security increased by 9.3 per cent over 2009, to $38.59 billion globally. The results indicate that retailers are seeing the positive correlation between investing in specialist security equipment such as electronic article surveillance (EAS), secure merchandising products and additional employee training.
"These benefits are going straight to the retailers' bottom line but, in effect, also benefiting consumers through better price competition."
To help offset costs due to shrinkage, Australian and New Zealand customers continue to be hit with an "honesty tax" of increased prices.
In the past four years, this has equated to $1781.16 In 2010, this honesty tax was $422.55.
Mr Gentle said lipsticks, shaving products and infant formula were repeatedly the highest theft lines in the region. Of all infant formula put on shelves, 2.07 per cent of stock will be stolen.
In a recent trial with three major retailers to develop security systems for infant formula specifically, all retailers reported dramatically reduced shrink rates, as well as increased sales on these product lines, he said.
"The correlation between increased security spending and a global decrease in theft is significant," said Professor Joshua Bamfield, director of the Centre for Retail Research and author of the study.
Wendy Marshall, general manager asset protection for Myer, said: "For the past two years, we have had a concerted effort on reducing shrinkage. By researching and understanding exactly what our issues were, internal and external, we were able to develop a strategy that enabled a company-wide focus with the motto: Shrinkage is everybody's business."
Despite Australia and New Zealand having a strong employment rate and economy, its rate of shrinkage is still considerably higher than the rest of the Asia-Pacific region.
Australasia also remains one of the highest employee theft regions in 2010, with 40.2 per cent of total shrinkage, or more than $1.17 billion, stolen by fraudulent employees.
During the past four years, employee theft alone has cost Australia and New Zealand more than $4.798 billion. Australasia is only second to North America in this aspect, where employee theft (43.7 per cent ) towers over losses due to customer theft (35 per cent).
Jacqueline Saad, a psychologist with nine years of experience consulting to organisations and individuals, said although "we have entered a period of more financial certainty, extensive psychological studies show that stealing is not predominantly based on meeting a dire financial need but one of a psychological nature".
MOST STOLEN ITEMS IN ASIA PACIFIC
- Lipsticks/glosses and lipliners (2.86pc)
- Shaving products (2.75pc)
- Perfumes/fragrances (2.41pc)
- Infant formula (2.07pc)
- Fashion/tailored clothing (1.88pc)
