Retail theft isn’t just a nuisance; it’s a challenge that affects every aspect of your business, from shrinking profits to compromising employee safety and threatening the sustainability of operations. For stores in high-theft locations, the stakes are even higher—putting added pressure on retailers to find effective solutions.
But what if you could mitigate theft not by adding more staff or complicated procedures, but with innovative anti-theft technologies? Imagine the relief of knowing your shelves stay stocked, your employees feel safe, and your customers happy.
In this blog, we’ll explore the true cost of retail theft, examining its impact on profitability, workplace safety, and long-term sustainability. We’ll also share actionable strategies to reduce theft and highlight how a Patronscan pilot project made a shocking difference in theft for three high-theft Canadian stores. Let’s dive in.
How Theft Impacts Retailers
1) Cutting Into Retail Profits
Retail theft has a negative affect on businesses—ultimately affecting a company’s bottom line, and sometimes in profound ways. Every stolen item directly leads to lost revenue, lessening profit margins. This not only impacts sales, but can also affect inventory management, leading to stock imbalances that may prevent stores from meeting customer demand.
In Canada, retail crime resulted in the loss of $5B last year. In the United States, matters are even worse. A study by Capital One predicts that shoplifting could cost retailers over $150B in 2026, and $121.6B was lost in 2023 alone. What’s worse, this problem doesn’t just impact big business. At least 85.5% of American small businesses experience retail theft, losing an average of $1,686 monthly.
The results across the UK and Australia are equally as staggering. In the UK, shoplifting offences have been increasing, with police-recorded crime data in 2023 increasing 32% compared to the previous year, up by 12% since the pre-pandemic period. In Australia, nearly one in every 10 retail crimes become violent.
To lessen theft, businesses often invest in surveillance systems, hire more staff, or train employees to detect theft. The problem is, these can be costly and hard-to-scale solutions.
2) Creating Safety Concerns for Staff and Customers
Retail theft not only threatens a business’ financial health but also the safety of patrons and employees. In Manitoba, Canada, $1.16M has been allocated to fund overtime police work in high-theft retail areas. In British Columbia, a Save Our Streets business coalition did a survey, revealing that retail crime is a major concern for the province’s civilians—with 55% saying the level of crime in their community has gone up over the past four years, and 74% saying crime and violence impact their quality of life. These are just a few examples of localised issues that are being felt across the globe.
Shop owners and staff across the retail industry are increasingly worried about the rise in theft. Confronting shoplifters can often escalate into verbal or physical threats, putting employees at risk of harm. This environment contributes to heightened anxiety among staff, as they remain on edge about potential incidents occurring during their shifts. The resulting stress can lead to higher employee turnover and a negative work atmosphere. Customer safety can also be compromised, potentially deterring patrons from visiting the store. Over time, these factors impact your retail environment and employee and customer experience.
3) Impacting Business Sustainability
Frequent retail theft can severely undermine a business's financial stability, making it challenging to recover losses and maintain profitability—especially in a climate where inflation drives up the cost of goods, rent, and wages. Generally, retail yields lower margins than other industries, with 10% as an average gross profit and 20% considered good. When those thin margins are eroded by theft—especially for small businesses—it makes staying in business for the long-term all the more challenging.
But retail theft doesn’t just hurt businesses—it has a ripple effect, often resulting in higher prices for customers, which impacts the broader community. This shared burden highlights the urgent need for effective theft prevention strategies.
Recurring theft incidents also often lead to higher insurance premiums. Insurance providers view frequent claims as increased risk, which results in higher coverage costs for businesses. For retailers already managing tight margins, these added costs create further strain. In response, businesses may feel forced to raise prices, but in a competitive market, this can drive customers to competitors, reducing sales and revenue.
When combined with the ongoing financial impact of theft, these pressures can threaten a business's long-term sustainability. Implementing advanced anti-theft technology can help break this cycle—ensuring businesses stay profitable, competitive, and open to serving their communities.
How to Reduce Retail Theft
Reducing retail theft requires a multi-faceted approach that balances security measures, employee preparedness, and community collaboration. Here are some strategies to consider:
1) Invest in Security Solutions
Security measures like hiring guards or installing surveillance systems can deter theft and improve safety, but they often come with higher upfront costs. Investing in advanced, proven technology designed to prevent retail crime can offer a smarter, more cost-effective solution in the long run.
Plus, the right technology can do more than just improve safety—it can also reduce friction and create a better experience for your customers. That said, not all tech is created equal. Take the time to explore your options and make sure the solution you choose delivers maximum impact with minimal disruption. When done right, technology should enhance safety and elevate the customer experience.
2) Provide Employee Training
Even with advanced technology in place, training employees to handle theft-related situations is essential. Staff who feel prepared and supported are more confident in responding calmly and effectively if incidents arise. Training sessions also reinforce a culture of safety and teamwork within your business.
3) Collaborate with the Community
Building connections within the community can strengthen theft prevention efforts while fostering a sense of shared responsibility. Here’s how you can engage:
- Partner with Local Law Enforcement: Establish relationships and invite law enforcement to events or meetings to create visibility and deterrence.
- Join Neighborhood Networks: Participate in local business associations or neighbourhood watch groups to share information about incidents and security measures.
- Raise Awareness: Organize workshops or events focused on crime prevention to educate both employees and the public about the effects of retail theft and ways to mitigate it.
By combining internal measures with community-based efforts, retail businesses can create a safer and more secure environment for both employees and customers.
Reducing Retail Theft with Patronscan
Patronscan offers a powerful solution to combat retail theft and enhance security with its Identity Verification Access Control (IVAC) technology.
IVAC is a solution that helps to enhance security for businesses that want to integrate door access control with ID validation. The result: a streamlined, frictionless and convenient solution that helps to prevent organized retail crime. Ideal for establishments with unmanned access points, IVAC helps stores rest assured that security and age-restriction laws won’t be compromised. Best used for either a door lock, turnstile, or cooler or fridge door, IVAC offers hassle-free access to help stop the expensive and ongoing stressor that is retail theft.
Mitigating Retail Theft in Action: A Pilot Project
In a 2020 Patronscan pilot project, IVAC technology was installed in three high-theft locations in Edmonton, Alberta, to create controlled entrances. The idea was to see how many incidents of theft it helped to prevent over a year.
Before installing Patronscan, location one reported 130 incidents, location two had 251, and location three had 281. After implementing IVAC technology, those numbers dropped dramatically—location one saw just 7 incidents, location two had 11, and location three recorded 20. That’s a 94% reduction in theft.
Building on the success of this pilot project, Patronscan has since partnered with retailers across the United States and Canada to make communities and employees safer. Our retail theft solutions now serve industries such as government, convenience stores, gas stations, casinos, and gaming rooms, where we continue to deliver meaningful impact.
If you’re ready to feel less stressed about retail theft—and the impact it has on your profit, safety, and sustainability—explore Patronscan’s advanced ID verification today.
