Retail shrinkage is a common problem for many stores. Shrinkage is the culmination of losses that your business experiences as a result of employee theft, shoplifting, administrative mistakes, and vendor fraud. When your business has a higher shrink rate, your profits are reduced by that difference.
Improper cash and inventory management means that many retailers are unable to identify and prevent shrink from occurring in their stores. It is in your best interests as a business owner to take a proactive approach to combatting retail shrinkage so that your business can increase its profitability. Reducing shrink involves closely monitoring the daily operations of your business so that you increase your awareness of where things are going wrong. It is only once you have identified the problem that you can takes action to reduce shrink. If the task of reducing shrink seems daunting, here are five ways to reduce shrinkage in retail businesses.