Several companies have recently closed stores or implemented stricter security measures to combat high theft. They blame these thefts for reported product losses, and undoubtedly stealing does have an impact on their bottom line.
However, an article highlighted that theft isn’t the only cause of loss and cited several examples of internal gaps that contribute to the shrinkage. “Loss prevention experts believe about 34% of shrink is from a combination of operational errors and unknown causes, close to the same amount attributed to external theft!” These can include inaccurate online orders, returns not being returned to inventory, shortage in staffing, order pick-up delivering the incorrect items, and stores serving as distribution centers as well as retail outlets.
It’s easier for Target and other organizations to blame external factors for their woes. There’s not much that can be done to combat those, whereas internal failings require hard work and tough decisions. It’s also easier for a college to blame a change in demographics for an enrollment decline rather than look inward at its strategies. A church can cite a decline in organized religion rather than work on its own messaging and outreach efforts. A bank can attribute losses to the stock market or a wealth of competition with financial instruments rather than accept responsibility for poor investment decisions or customer service.
Yes, every organization faces external pressures that make the work more challenging. And, every organization has internal operations that can be improved. Focus your efforts on what you can control.
Source: Crime the only link to retail shrink? Analysts also blame other factors for losses. By Nicole Norfleet, Minneapolis Star Tribune, in the Telegraph Herald, November 5, 2023, p. 14C