Crime costs shops $1 billion a year
Crime is costing retailers nearly $1 billion this year, most of which they never recover, University of Otago research has found.
The 2017 Retail Crime Survey is the second iteration of a study done 14 years ago.
Eighty-one per cent of all the retailers surveyed said they had been affected by retail crime.
The study found most smaller retailers couldn’t detect ‘‘every instance of a crime’’. It instead looked at the stores’ ‘‘shrinkage’’ of stock, which could be caused by theft, fraud, or errors and mistakes from administrators.
The average amount of stock that disappeared from shopowners’ shelves this year was 1.6 per cent of their total stock – of that 1.6 per cent, 1.3 per cent of it was because of crime.
‘‘For larger retailers, this number will be well known and understood,’’ the report said.
‘‘Smaller retailers that do not have sophisticated stock management systems, or that do fewer regular stock takes, may have a less detailed understanding of shrinkage levels.’’
Retail NZ spokesman Greg Harford said the accuracy of stock management systems depended on the business, but because most had an automated point of sale, and goods were accounted for as they reached a store.
Harford said this meant retailers could track their stock to at least within $10 of its value.
Shoplifting was by far the mostrecorded crime. It made up almost 250,000 of the 290,000 incidents retailers reported to Retail NZ.
Despite it being so common, only one in every three shoplifters was reported to the police.
Refund fraudsters, online fraudsters, and credit card fraudsters were slightly less reported to police.
And employees caught committing crimes even less reported than fraudsters, with one in every four caught then reported to police.
Retail NZ chief executive Scott Fisher and Otago University professor Dr John Guthrie said the overall impact of crime on a business included the fear and trauma felt by employees in violent situations, the stress to business owners, the cost of policing, and the courts and corrections processes.
Most of which was not included in the $1b figure and the taxpayer covers.
Harford said more could be done by police to take action against low-value theft, which adds up over time.
The problem is compounded by the fact ‘‘most retailers have a perception that police won’t take action on low-value theft’’, Harford said.
‘‘There are unreported crimes that need to be reported because it won’t get focus and action it you don’t report it.’’
He said police did quite well with retailers who experience violence, intimidation and property destruction but he would like to see a dedicated retail crime unit formed.
Those surveyed included Retail NZ’s members, members of the New Zealand Association of Convenience Stores and the New Zealand Crime Prevention Group.