Retail Loss – A growing problem
Retailers across Europe are facing increasing pressures and retail loss following a significant increase in shoplifting, crime, and anti-social behaviour. A report by European Alliance for Safe Retail (EARS) found that the cost of retail crime increased by 13% to €16.6 billion in 2022.
The British Retail Consortium have released a crime survey revealing that violence and abuse against retail workers rose sharply by 50% last year, to 1,300 incidents per day. The survey also reveals the following:
- The cost of theft to retailers went up to £1.8 billion in 2023, from £953 million in the previous year.
- The total crime to retailers stood at £3.3 billion in 2023 – double the previous year’s figure.
- 60% of survey respondents were dissatisfied with the police, describing their response to incidents as ‘poor’ or ‘very poor’.
Helen Dickinson OBE, Chief Executive of the British Retail Consortium said: “Despite retailers investing huge sums in crime prevention, violence and abuse against retail workers is climbing. With over 1,300 incidents every day, government can no longer ignore the plight of ordinary, hardworking retail colleagues.”
“Criminals are being given a free pass to steal goods and to abuse and assault retail colleagues. No one should have to go to work fearing for their safety.”
As crime and theft in the retail industry soars across Europe, retailers must act and continue to demand support from policy makers and law enforcers.
In this article, SWL explore the Retail Loss Prevention initiatives being deployed across several retailers in Europe and considers the impact to in-store productivity and Customer Experience.
The Netherlands & Belgium- Jumbo
Dutch supermarket Jumbo has announced it is expecting to take a €100 million hit from shoplifting last year. The grocery retailer is boosting surveillance in its stores including more randomised checks at self-checkouts. Customers will be incentivised to participate via a new proposition, ‘Jumbo Winwiel’, where they will have a chance to win a free product following an error-free, extensive random check.
Jumbo has also announced that they will be implementing AI software to recognise ‘deviant behaviour’ among customers in their stores. Anrico Maat, Retail Director at Jumbo told European Supermarket Magazine:
“Shoplifting is not normal and should never become normal. Everyone is affected by shoplifting and the damage it causes.”
“That is why we are taking extra measures, precisely because we want to be the most customer-friendly supermarket for our customers where you can shop pleasantly and safely and our employees have a pleasant workplace.”
Jumbo will also be implementing communications to remind customers to pay for their items and inform customers of the new measures.
Portugal – Pingo Doce & Continente
Several supermarkets in Portugal are adding anti-theft systems on basic food products, following a rise in retail theft. Supermarket chain Pingo Doce have reported that categories such as personal hygiene, detergents and groceries are especially notable.
Another grocer, Continente, report that the categories most susceptible to theft in their chain include coffee capsules, chocolate, and canned food. It is adding protection mechanisms to products in store to allow for monitoring and a reduction in thefts.
Gonçalo Lobo Xavierm, the director general of the Portuguese Association of Distribution Companies told Expresso: “Thefts have been rising sharply, especially since the beginning of September and particularly in the large urban centres of Lisbon and Porto”.
Spain – Tu Super, Carrefour & Auchan
Supermarkets in Spain have resorted to locking up bottles of olive oil after an increase in thefts. Tu Super, who have 30 stores in the Andalucía region of Spain, have chained and padlocked 5 litre variants of olive oil to the shelves. Reuters report that this follows a price surge of over 150% over the past 2 years, with olive oil now officially costing around €8 a litre.
CEO of Tu Super, Ruben Navarro told Reuters: “We are seeing a major surge in shoplifting. Olive oil has become an ideal product for them to steal.”
Commenting on the action that the supermarket chain has taken, Navarro added: “It is a crazy, extreme measure, but it has worked.”
Similar measures have been taken in other Spanish supermarkets, Carrefour and Auchan. In Madrid, 1 litre bottles of olive oil are now security tagged.
As the retail industry in Spain grapples with an increasing amount of theft, rules in the country mean that only thefts of items over €400 are prosecuted by officials.
Spain – Tu Super, Carrefour & Auchan
Co-op UK have revealed that they have invested over £200 million in recent years implementing preventative measures to make its stores safer for their customers and colleagues. In 2023 alone, the retailer experienced over 300,000 incidents of shoplifting, abuse, violence, and anti-social behaviour. They report that such crimes have increased by 35% year-on-year.
Co-op are undertaking a range of preventative measures to help stem the issue. This includes replenishing shelves with dummy display packaging in categories across the store, including coffee, higher value chocolates, washing powder and laundry gels. Customers are required to take the dummy packaging to the tills, where they will be exchanged for the product by store staff.
Other measures that the Co-op have implemented include interactive and remove controlled cameras, communication headsets and covert & non-covert guarding.
Director of Operations at Co-op, Kate Graham said: “It is an ongoing challenge for all retailers, and often a flashpoint for attacks and abuse towards our colleagues.”
“Co-op continues to invest significantly in keeping colleagues and stores safe. This includes extending our use of dummy display cases to deter the incidents of ‘bulk-shoplifting’ or, ‘looting’, as it has been described, where criminals sweep products off shelves for re-sale.”
“While we are doing all we can, we also need the police to play their part as too often, forces fail to respond to desperate calls by our store teams and criminals operate in communities without any fear of consequences.”
What does Retail Loss Prevention mean for Sales, Productivity & Customer Experience?
It’s apparent that retailers across Europe are taking decisive action to combat retail loss. However, what is the impact of these on Sales, Productivity, and Customer Experience?
When implementing loss prevention in retail, it’s important to consider these alongside the financial benefits that can be realised by implementing more robust procedures, equipment, and technologies. Retail Boards are looking for:
- Employees to feel safer in stores.
- Sales performance to be safeguarded.
- Customer Experience to be protected.
- A significant improvement in retail loss performance.
- Processes, technologies, and equipment which have a quick Return on Investment.
- Retail Loss Prevention implementations that colleagues are confident using and adopting.
We’ve uncovered the significant cost burden that retail loss can have on retailers, and the strategies that many of them have deployed to mitigate the risk. Now, let’s explore how retail loss prevention positively impacts Sales, Productivity, and Customer Experience:
- Reduced Theft – By implementing retail loss prevention measures, retailers can reduce the amount of theft in their stores and create effective deterrents. This results in increased profitability and revenue.
- Better Inventory Management – By reducing the amount of unknown loss, retailers can significantly improve their inventory management. This results in better on-shelf availability for customers and less administration routines for store teams such as stock counting.
- Enhanced Customer Experience – By reducing theft and crime, retailers can offer a more inviting atmosphere for customers. Customers are more willing to visit stores as they feel more safe and secure.
- More competitive prices – As store theft decreases, retailers have the option to pass on savings to customers via reduced, more competitive prices. This makes the retailer more attractive to customers and improves the value perception.
- Decreased Employee Attrition – Reduced crime and theft in stores makes it a safer place for store staff as well as customers. As staff feel safer in the workplace, staff attrition may reduce.
However, there are some factors that retailers must consider when implementing any retail loss prevention strategies, to minimise the harm to sales, productivity, and Customer Experience. These include:
- Reduced Customer Convenience – Implementation of measures such as product tagging and locked displays can create an inconvenience as customers may experience longer waits at the checkout. In areas such as self-checkouts, this can be a real detractor.
- Decreasing Customer Satisfaction – Whilst colleagues focus on the measures in place to prevent theft, less time is spent focusing on customer satisfaction and experience. This results in a less personalised shopping experience for customers and may impact brand loyalty and perception.
- Disjointed Customer Journey – Retail loss prevention methods such as changing product placement around the store, for example, re-siting chewing gum at checkouts, rather than with other confectionary products creates a disjointed customer journey. Customers may choose to shop elsewhere as a result.
- Less efficient tasks – Retail loss prevention can cause added complexity to tasks if new processes and ways of working aren’t implemented as effectively as possible. When new measures are implemented, compliance tracking can further burden store management and staff. This must be carefully managed to ensure the best outcomes and store adoption.
- Resource Allocation – Additional activities and tasks require additional labour. Implementations of retail loss prevention must be governed closely to ensure that they still deliver benefit and return on investment.
Retail Loss isn’t going away – how can you ensure your strategy has a positive impact on Sales, Productivity & Customer Experience?
SWL have partnered with leading retail brands in the UK and Internationally for over 30 years. During this time, we have helped retailers enhance their productivity and operations, implement new technologies, sustain improvements, and deliver against compelling transformation strategies.
When making investment choices, it is crucial to quantify the benefits and risks as well as define the best roadmap for execution. SWL can help you deliver your Retail Loss Prevention strategies, enabling positive and sustainable change.
Retailers seek a customer journey which is simple and shorter, whilst implementing retail loss prevention often adds complexity. Your Retail Board expect certainty, clarity, and guaranteed benefit. It requires an approach which protects the customer journey and minimises risk. Partnering with SWL ensures:
- A robust implementation which delivers ‘right-first-time’.
- Maximised benefit release, delivering certainty to the board.
- Confidence in your team using new technologies and equipment – you require the best adoption by all stakeholders.
- Supported, fit-for-purpose processes are adopted by store teams and successfully fix the business pains.
Discover how an SWL partnership can benefit your Retail Operation
We’d be delighted to tell you more about how SWL can help you with your Retail Loss Prevention strategy.
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Contact SWL on (+44) (0)1527 895 020 or get in touch with the team here.