Losses at ten-year high

German retailers suffered losses in excess of € 5.4 bn from July 2010 to June 2011 through shrinkage. This indicates a 7.1 per cent increase in losses to 1.2 per cent of turnover. According to the latest Global Retail Theft Barometer, the fifth in series, the rate of shrinkage came to 1.12 per cent the year before. This survey, which is conducted annually by the Centre for Retail Research (CRR) in Nottingham, England, and underwritten by article surveillance specialists Checkpoint Systems of Heppenheim, reveals that German retailing not only notches up a record increase but is also positioned at the highest level for ten years. “The perceptible increase in shrinkage can above all be traced back to the fact that many retailers are cutting back in the area of security measures,” explains Dirk Endlich, Checkpoint Systems’ manager for Germany. According to the results of the survey, German retailers spent 0.23 per cent of their turnover on security measures, some 22 per cent less than the previous year (2010: 0.28 per cent of turnover). Furthermore, Endlich continued, lower investment in the prevention of shrinkage and anti-theft measures usually has a direct effect on the inventory discrepancies and so costs companies dearly. “The consequence is not only reduced profit margins but also a lower level of goods availability in the stores: something that has been nicked can no longer be sold,” he concluded. Shrinkage cost the retail sector € 88.878 bn on a global scale. The rate of shrink amounts to 1.45 per cent (2010: 1.36 per cent) measured against turnover. Shrinkage in Europe accounted for 1.39 per cent of turnover (2010: 1.29 per cent). India has the highest rate of shrinkage at 2.38 per cent, with Russia second at 1.74 per cent. In the vertical market the highest global rates of shrinkage in 2010 were suffered by fashion/accessories at 1.87 per cent, followed by health & beauty/pharmacy with 1.79 per cent. The table of 16 product categories included automotive aftermarket/hardware/DIY products at 1.77 per cent, or third position. However, this was the only category that managed to reduce its shrinkage in 2011 on the previous year, when it came to 1.81 per cent. The automotive aftermarket/hardware/DIY products sector also occupies an inglorious third position in Europe. However, the figures here are somewhat lower and show a different tendency. Shrinkage in this area was 1.72 per cent in 2011 and 1.70 per cent in 2010, which shows a slight 0.02 per cent…