Report: Retail Cash Theft Rises 20%

cashLondonPublished by Retail Knowledge and sponsored by Volumatic and Kount, the U.S. Retail Fraud Survey 2014, now in its second year, is an extensive study of the retail fraud and loss prevention systems, processes and strategies employed by of 100 of the US’s top retailers.

The latest Survey shows that cash theft, one of the top areas of store loss for retailers, has moved up a position and now represents the second biggest area of store loss at 24% of shrink. This is a 20% increase since last year’s Survey, where it was positioned as the third biggest loss.

The Survey also revealed that, during the same period, the number of stores using secure cash storage systems at the POS dropped by almost 35%.

James Harris of Volumatic, one of the US Retail Fraud Survey sponsors, emphasizes the importance of utilizing intelligent cash handling systems:

“On a per transaction basis, cash remains the cheapest, fastest and most popular way for retailers to accept payment, representing an important opportunity for retailers.

Those retailers wishing to take advantage of this opportunity are increasingly employing intelligent cash handling systems to substantially reduce cash shrink, enhance security, streamline cash handling processes and deliver significant operational efficiencies.

While to suggest that the reduction in use of secure POS is directly responsible for the dramatic increase in cash shrink would be to oversimplify a complex issue, those retailers affected may well wish to review their cash handling systems, in the light of this information, and re-examine how they store, validate, count and move their cash; both around their stores and to their bank.”

Other areas of store loss highlighted by the Survey include:

  • Employee theft is identified as the biggest area of store loss at 38% of shrink, up 3% on last year
  • Administrative and bookkeeping errors account for the third biggest area of loss at 21%; a 9% decrease
  • Shoplifting is the fourth biggest area of loss in stores at 11%; a 15% decrease

Volumatic offers a free cash handling audit to retailers wishing to evaluate how they might streamline their cash handling processes and secure other operational benefits at the same time

About the Survey

This study is based on primary research, carried out between April and May 2014, into the systems, processes and strategies used by 100 of North America’s leading retailers. Detailed interviews with the Loss Prevention director or manager for each company in the report were carried out. We also interviewed the e-commerce director or manager about their online fraud prevention systems and strategies where if the Loss Prevention director was not able to provide the relevant information.

This study represents retailers with annual sales totaling $864 billion; 19% of the total North American retail sector by sales value and encompassing 126,000 stores.

 

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Jeff Prine, Editor at Large, Accessories Magazine
Jeff returns as a regular contributor to Accessories magazine. Initially Jeff worked as senior editor at Accessories more than 20 years ago and his love of the industry has followed him until present. Since his tenure here, Jeff has continued to report jewelry, watch and other luxury goods trends as executive editor at Modern Jeweler magazine, fashion director at Lustre, and as contributor on products and trends for consumer and trade publications and websites. In addition to his editorial experience, Jeff also served as an adjunct instructor for accessories merchandising at Fashion Institute of Technology. jeffp@busjour.com

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