Posted on: April 8, 2024

Mitigate Risks: Shoplifting Solutions for Aussie SMEs

A swathe of retail job vacancies, cost of living crisis, and advance of self-serve checkouts are creating a perfect storm of a surge in shoplifting, according to The Australian Financial Review.

It’s a scourge that costs Australia’s retail industry an estimated hundreds of millions of dollars a year. The Australian Retail Association, in its 2024 Australian Retail Outlook Report, says financial year theft or ‘shrinkage’ will account for up to 3% of total retail sales. That’s a whopping 25% less profit for retailers like you.

What’s going on and what can you do?

Shoplifting a national issue

You’re not alone if your SME struggles with shoplifting, it’s a problem across the country.

Individual state or territory statistics make for interesting reading. In NSW, for instance, the state’s Bureau of Crime Statistics and Research found that most offenders are in their 30s, but it’s 14-to-17-year-old shoplifters that were more involved with the police. The ‘hottest’ items are liquor, then clothing, with the average value of a stolen item being $440, according to 2022-23 reports.

Why shoplifting is hard to claim

However, businesses often find it tricky to claim against these losses. Typically, policies will not cover shoplifting. If they do, they’ll have a small limit. The onus is on you to prove there was a theft, that you contacted the police promptly and secured the scene.

Installing security cameras

Security cameras – closed circuit television CCTV – can deter criminals. Importantly, they’ll capture crucial details to help identify the culprit after the fact.

Whether you’re about to install them or already have them, check these best practices:

Ensure they can record the entrance, exit, sales counter, where cash is handled, and where there’s high-value stock

  • Aim the lens to capture offenders’ faces
  • Keep cameras fully visible to customers
  • Check your system regularly, especially data storage
  • Opt for 24/7 surveillance

That highlights that CCTV data is useful, but you need time and ability to work with what could be volumes of data. Training for you and your staff in using the system effectively is a worthwhile investment. Deep learning, a form of machine learning and artificial intelligence, can be useful and may be an option available from your CCTV provider.

Check with your local or state/territory government, as many offer CCTV grants for small businesses.

Beware of common shoplifting tactics

Here are popular shoplifting tactics to keep on your radar in 2024:

  • They’ll wait until all staff seem busy, then dash into your store, grab items and dash out
  • Culprits will swap price tags to get an (illegal) bargain
  • Stashing items in their clothing, prams, handbags, shoes, shopping bags, etc
  • Working in pairs or packs, so one distracts your sales staff member, while their accomplice does the stealing
  • Be wary of atypical customers, those with oversized clothing or huge bags
  • Stashing items in their clothing, prams, handbags, shoes, shopping bags, etc
  • Fraudulent returns where they bring the stolen item back and ask for a cash refund

Types of retail insurance you should have

While we can’t offer you a specific shoplifting policy, there are other ways to protect your business against the diverse risks and liabilities you could face. They include:

  • Theft, burglary or other crimes that could happen within your business
  • Third-party claims for property damage or injury
  • Defective products that damage or injure your customers
  • Damage or destruction of physical assets, including equipment, inventory, and the building
  • Cyber breaches or attacks

Let us help you boost your risk management including tackling shoplifting.

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