At the recent National Retail Federation Loss Prevention Conference in Los Angeles, Dr. Richard Hollinger from the University of Florida presented the preliminary 2008 results. Many of us look to this survey as the benchmark for shrink performance and the figures here will be cited over and over again in the press.
Overall, inventory shrinkage as a percentage of sales (retail) came in at 1.52% with 95 retailers reporting. While this is up from 2007’s all-time low of 1.44%, it is still the second lowest number in the history of this survey that has been compiled since 1991.
Extrapolating this percentage out against total industry sales in 2008, gives a dollar figure of $36.53 billion. From a purist’s perspective, I think this is a bit dicey as the overall percentage is calculated as an average of all respondents shrink percent number and not weighted based on sales volume of responding company. But, we do not have any better source as an industry.
As to estimates from retailers on the sources of shrinkage, the gap between employee theft (43.7%) and shoplifting (35%) continues to inch closer to each other. Final results will be released soon and results may change slightly in the final report based on late survey responses.
