Retailers Struggle to Curb External Theft Losses
A new study reveals that external theft and organized retail crime account for 25% of total retail losses globally.
Updated on Oct. 22, 2026 in Property Crime
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External theft and organized retail crime are driving significant losses for retailers worldwide, with 71% of large businesses reporting an increase in shoplifting. The study finds that smaller firms are also impacted, though to a lesser extent than their large-scale counterparts.
Why it matters
Retailers are currently facing complex challenges in safeguarding inventory, as these losses threaten profit margins and force shifts in resource allocation. Understanding the composition of these losses is critical for companies looking to optimize their loss prevention strategies.
Administrative process errors cost an average of $103.40 per incident, while employee theft averages $107 per incident. Retailers currently dedicate an average of 1.2% of total sales to loss prevention budgets.
The players
IHL Group
This research and advisory firm specializes in analyzing retail technologies and industry trends.
Sensormatic Solutions
This company provides retail performance and inventory intelligence solutions to businesses globally.
The details
The report, which surveyed 915 retail decision-makers, indicates that external theft accounts for 26% of losses for companies generating $1 billion or more in revenue, compared to 17% for those earning under $250 million. Additionally, 68% of respondents noted an increase in return fraud.
Timeline
The Beyond Shrink global retail loss study was published in 2026.
Legal Context
The findings from the Beyond Shrink global retail loss study mark a departure from previous assessments by quantifying the exact impact of diverse loss sources across different revenue tiers. This data follows a pattern set by industry-wide efforts to standardize loss prevention metrics amid rising global crime reports.
Consumers may notice increased security measures and monitoring as retailers adjust their staffing and operations to curb theft. These shifts could lead to more restrictive return policies or changes in product availability as companies attempt to manage these financial losses.
The takeaway
Retailers are increasingly leveraging data to align staffing and monitoring efforts with traffic patterns to minimize shrinkage. Businesses should prioritize evaluating both administrative errors and external theft to protect their overall bottom line.
Further reading
For more information on trends in inventory loss, visit our Property Crime section.
Source note: This article includes information reported by Chain Store Age.
Live Poll
Is now the right time for retailers to prioritize digital loss prevention tools over traditional staffing?
