Understanding Internal Theft

Shoplifters and dishonest employees continue to steal profits from United States retailers

Just 30 U.S. retail companies lost over $5 billion to shoplifting and employee theft in 2001, with only 3.45 percent of those losses resulting in a recovery, according to the Fourteenth (14th) Annual Retail Theft Survey conducted by Jack L. Hayes International, the leading loss prevention and inventory shrinkage control consulting firm. According to Jack Hayes, this means that for every one dollar recovered, another $27.95 is lost to retail theft.

While both the number of dishonest employees apprehended and the dollars recovered from those employee apprehensions finally leveled off after 7 consecutive years of increases, our survey participants reported sizable increases in the number of shoplifters apprehended and the dollar recoveries from shoplifting. Shoplifting and employee theft continue to be costly crimes which negatively impact the bottom line profits of many retailers. The result of these crimes is higher prices for consumers at the cash register, and a loss of jobs for employees when retailers are forced to close stores or even go out of business.

This highly anticipated annual survey reports on over 700,000 apprehensions taking place in just 30 large retail companies representing 12,833 stores with combined 2001 annual sales in excess of $419 billion. Some of the major results from this survey are:

  • Total dollar recoveries from both shoplifters and dishonest employees in 2001 exceeded $182 million, an increase of 9.44% over 2000.
  • Survey participants apprehended 622,222 shoplifters in 2001, which reflects a 5.19% increase over their 2000 shoplifter apprehensions (591,545).
  • Dollars recovered from shoplifting apprehensions totaled $70,954,254 in 2001, which is an increase of 9.32% over 2000 recoveries ($64,905,425).
  • For the fifth consecutive year, the dollars recovered from shoplifters where no apprehension was made increased substantially over the prior year ($41,275,172 in 2001 vs $30,315,706 in 2000, up 36.15%), after increasing an astonishing 27.96% in 2000 and 23.45% in 1999.
  • Dishonest employee apprehensions (77,805 in 2001 vs 78,468 in 2000) and the dollars recovered from those apprehended employees ($70,221,185 in 2001 vs $71,494,974 in 2000) decreased ever so slightly in 2001 (0.84% and 1.78% respectively), after increasing the prior 7 consecutive years.
  • On a per-company basis, one in every 27 employees was apprehended for theft from their employer. (Based on over 2.2 million employees.)
  • On a per-person basis, dishonest employees steal approximately 7.9 times the amount stolen by shoplifters ($902.53 vs. $114.03).

Ken Smith, Inc. is proud to offer solutions to combat this ever-growing problem. By working with some of the most prominent companies in the industry, we have come up with solutions that work and have documented results.

The numbers don't lie! Internal theft is a serious problem that needs serious attention. If you currently lack a security plan in your business, let KSI help you with a new plan of attack that encompasses your needs and budget restrictions.

 

*Statistics provided by Jack L. Hayes International, Inc.

Survey Participants

  • 30 Large Retail Companies
  • 12,833 Stores (representing an excellent cross-section of the United States)
  • $419,130,596,000 in Annual Retail Sales (2001)