MEDIA RELEASE PR42004
Global Retail Theft Barometer Study Finds Shrinkage Down 5.6% to 1.36% of Retail Sales or THB3,261
Billion (US$107.3 Billion) Worldwide
BANGKOK, Nov. 2, 2010 /PRNewswire-AsiaNet/ --
Retail Shrinkage in Thailand Remains the 2nd Highest in Asia-Pacific
2010 Shrinkage Rate Reached 1.57%, Higher than Global Average by 15%
Increased loss prevention spending globally contributed to lower shrinkage rates
-- Shrinkage decreases 6.5% in Asia-Pacific, but almost one-quarter of
Asia-Pacific & Thai retailers still experienced higher attempted or
actual theft
-- Infant formula and alcohol/liquor has the highest shrinkage in grocery
stores. Fashion/tailored clothing and accessories, and health & beauty
supplies like shaving products, lipsticks and glosses are the key
targets of shoplifters in Asia Pacific
Global retail theft totaled THB 3,261 billion (US$107.3 billion) in 2010, representing a 5.6% decrease from the
prior year (6.5% in Asia-Pacific); while Thailand continues to suffer from high retail shrinkage at 1.57% of total retail
sales. The number is down from the record high rate of 1.66% in 2009, but is still higher than the Asia-Pacific rate
by 35%, according to the fourth annual edition of the Global Retail Theft Barometer, a summary of which is
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, and found that shrinkage decreased in all regions surveyed. The biggest decrease was in North
America. The proportion of global retailers that reported increased actual or attempted shoplifting in 2010 was
31.1% (23.1% in Asia-Pacific).
"Even with the shrinkage decrease, retail crime cost the average family in the 42 countries and regions surveyed
an extra THB5,654 (US$186) on their shopping bill," said Professor Joshua Bamfield, Director of the Centre for
Retail Research and author of the study. "In Thailand the number was THB1,550 (US$51), the 3rd lowest in Asia-
Pacific."
Correlation Between Increased Security Spending and Decrease in Theft
The 2010 study also found that retailers increased their spending on loss prevention and security by 9.3% over
2009, to THB815 billion (US$26.8 billion) billion globally, whereas a 6.7% increase in loss prevention spending in
Asia was recorded compared to last year.
"The correlation between increased security spending and a global 5.6% decrease in theft is very significant,"
said Bamfield. "It highlights the importance of continued advancement and improvement of loss prevention
programs, as reducing theft is key to the success and growth of retailers' businesses."
"In 2008, at the start of the economic downturn, the temptation for retailers was to reduce their loss prevention
spending," commented Rob van der Merwe, Chairman, President and Chief Executive Officer, Checkpoint
Systems. "This typically leads to an increase in shrink and that is what we saw with the 2009 Theft Barometer
study. Retailers quickly realized the need to correct this trend and began to invest in smart deployments that could
be quickly implemented with high ROIs, such as increased protection of high-theft merchandise, and more
employee training and store audits. This resulted in a short-term win and a decrease in shrink.
"As we continue to slowly recover from the recession," he continued, "it is perhaps the right time to combat
shrink with a more comprehensive path and begin looking to the merging technologies that will carry retailers
through to the future. Examples include the newest generation of EAS and also RFID technology to additionally
provide better tracking and visibility of inventory across the supply chain, leading to the elimination of out-of-stocks
and increased sales."
Global Retail Shrink Rates
Shrink cost retailers THB3,261 billion (US$107.3 billion) during the study period, representing 1.36% of global
retail sales. This is down from 1.43% the previous year. The country/region with the highest rates of shrinkage as a
percentage of sales was India (2.72% of retail sales). The lowest rate of shrink was found in Taiwan (0.87%).
Ranked as the 2nd highest shrink country in the Asia-Pacific, Thailand's retail shrinkage rate at 1.57% is at least
35% higher than the Asia-Pacific rate (1.16%) and 15% higher than the global average respectively.
Items With Increased Shrink Rates
While shrink is down overall, some of the most stolen items have suffered increased shrink since last year,
including children's wear, outerwear, shaving products, luxury cooked meats and infant formula.
Shrink by Global Vertical Markets
Shrink varies according to business type, vertical market and country. In 2010, some of the highest average
shrink rates were found in apparel/clothing and fashion/accessories (1.72%), and cosmetics/perfume/health &
beauty/pharmacy (1.70%).
Origins of Shrink
Customer theft, including shoplifting and organized retail crime caused the greatest shrink loss in most countries
at 42.4% of shrink, followed by employee theft at 35.3%.
"Although retailers have made considerable progress in introducing new anti-shrink policies, more than 25% of
the retail 'top fifty' most-stolen product lines still have no specific protection," said van der Merwe. "So our industry
needs to accelerate innovation to help better protect retailers and consumers."
More Asia-Pacific & Thailand Highlights on Retail Shrinkage
Loss prevention spending in Thailand (0.13% of sales) ranks the lowest in the Asia Pacific, far behind than the
Asia-Pacific average (0.19%) and global average (0.34%). This is likely to be one of the key reasons for the
country's high shrinkage comparing to the rest of the world.
Shoplifting
-- Thai retailers suffered 48.9% of retail shrinkage by shoplifters,
amounting to an annual sum of THB14,924 million (US$ 491 million).
-- The highest average rates of shrinkage were in apparel/clothing and
fashion/accessories (1.72%) and cosmetics/perfume/health & beauty/
pharmacy (1.71%).
Employee theft
-- The second largest source of retail shrinkage was employee theft, at
23.4%.
The Survey
Started in 2001 in Europe and expanded in 2007 globally, the Global Retail Theft Barometer (GRTB) is an
annual survey conducted by the Centre for Retail Research in Nottingham, UK and sponsored by Checkpoint
Systems. This study is the largest and most comprehensive survey of retail theft and crime in the world. The study
covers key trends in retail shrink and crime in 42 countries and regions across the world, including the U.S., China,
India, Europe, Japan and Australia. Russia is included for the first time this year. This report has been prepared
from confidential details provided by 1,103 of the largest retailers representing 233,721 stores with combined sales
of THB26,560 billion (US$873.8 billion), representing a cross-section of countries and retail vertical markets.
About The Centre For Retail Research
The fourth edition of the Global Retail Theft Barometer (tenth edition for Europe) has been produced by
cooperation of Checkpoint Systems, Inc. The CRR is an independent organization providing research and
consultancy for the retail sector dealing with the changing face of retailing and focusing on retail fraud and crime. It
has carried out extensive studies dealing with the costs of crime and the application of electronic and computerized
systems to combat shop theft and fraud in many parts of the world.
About Checkpoint Systems, Inc.
Checkpoint Systems is a global leader in shrink management, merchandise visibility and apparel labeling
solutions. Checkpoint enables retailers and their suppliers to reduce shrink, improve shelf availability and leverage
real-time data to achieve operational excellence. Checkpoint solutions are built upon 40 years of RF technology
expertise, diverse shrink management offerings, a broad portfolio of apparel labeling solutions, market-leading
RFID applications, innovative high-theft solutions and its Web-based Check-Net data management platform. As a
result, Checkpoint customers enjoy increased sales and profits by improving supply-chain efficiencies, by
facilitating on-demand label printing and by providing a secure open-merchandising environment enhancing the
consumer's shopping experience. Listed on the NYSE (NYSE:CKP), Checkpoint operates in every major
geographic market and employs 5,700 people worldwide. For more information, visit
CONTACT:
Natalie Chan
Checkpoint Systems, Inc.
Tel: +852-2995-8350
Email: natalie.chan@checkpt.com
SOURCE: Checkpoint Systems, Inc.
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