How You'll Be Robbed Of $423 This Year Without Realizing It

If Punky Brewster taught me anything, it’s that shoplifting is harmful to everyone’s bottom line. Retailers, which pass the costs of insurance against theft to customers, will cause the average shopper to part with $423 extra at the mall this year.

CNN Money reports a Global Retail Theft Barometer report from the Center for Retail Research finds the American cost for store theft is more than double the global average.

American retailers lost $40 billion due to theft in the most recent fiscal year, making up 1.5 percent of total sales, the story says. It’s safe to say zero percent of that figure comes from those who’ve been scared straight by episode 13 of season 2 of Punky.

Thieves will cost you $423 at the mall this year [CNN Money]
(Thanks, bubbicito!)

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  1. Blueskylaw says:

    I won’t be robbed of $423 Dollars this year because if for some reason retailers could make it so there was absolutely no shoplifting, they wouldn’t lower prices but keep the extra “savings” as profit to be distributed among top management as “good job” bonuses.

    • wrjohnston91283 says:

      Most likely they wouldn’t lower it the full amount, but somewhere in between and split the difference with us. Some companies will be wiling to lower prices to get more customers, forcing other companie to do the same.

      Also, not all expenses are able to be passed onto the consumer. If there were, no company woud ever lose money. Companies can only charge wha consumers are willing to pay.

    • dbeahn says:

      +1

      We’ll pay those prices no matter what.

    • balthisar says:

      Sounds like someone doesn’t know how markets work.

      • duxup says:

        Rather he knows how people often work.

      • Blueskylaw says:

        Do you know that oil/gas companies make more money when gas prices go down and they don’t lower pump prices than when oil prices go up and they raise pump prices.

        Transfer that model to the retail market.

        • wrjohnston91283 says:

          Prices eventually go down (if there is competition), it doesn’t happen overnight. One station will drop 5 cents, then another will drop cents.

          Its actually the same in retail. If a supplier raises prices significantly on a commodi item, a retailer will normally not sell for a loss, instead selling just above cost; but if prices go down they will slowly decrease prices along with their competition.

        • Gulliver says:

          Would you care to provide proof of this? I bet you won;t because it is a lie. When gas was at an all time high, guess who had the largest quarters of profit in US history? But I am sure the oil and gas industry are glad they have a shill like you

        • huadpe says:

          You are conflating gas stations with oil companies. Gas stations are franchises or independent outfits, but either way, they do not get a share of any profit or loss from drilling for oil. Likewise, the oil drilling/refining companies only get the amount that they can sell the gas to a station owner for.

    • stock2mal says:

      Or they could pay their employees an equitable wage so they would be less likely to steal.

    • Griking says:

      A typical excuse that customers use for why they shouldn’t have to do their share like show their receipt at the door or show an ID when they pay with a card.

  2. Nigerian prince looking for business partner says:

    It’s amazing how much money we have to spend to make up for other people stealing or not paying their bills…

    I just read a report by my state’s HHR department indicating that a typical family health insurance policy costs an extra $2,000 to cover providers over-charging the insured to make up for losses caused by the uninsured.

    Plus $400 to cover shoplifters, a few hundred for uninsured motorist coverage on my auto policy, an umbrella policy to protect assets, etc.

    • An_Album_Cover says:

      Can you provide a link to that report? I’d love to have it as fodder as a pro-individual-healthcare-mandate sorta person…..

      • Nigerian prince looking for business partner says:

        I’ll see if I can dig it up.

        If I recall, we (West Virginia) have the highest additional costs, which amount to about an extra $2,000 and the national average is around $1,400.

    • Happy Tinfoil Cat says:

      Not just the providers. Pharmaceuticals charge US citizens an average of triple what they charge most other countries. So if you look at it the same way, we are supporting all those socialist, commie bastards. ;^) Overall, US healthcare is more expensive than far better care in dozens of other countries.

  3. teamplur says:

    I’ll just make sure to take home my $423 in extra stuff I’m paying for then

  4. TheRedSeven says:

    The solution is clearly to shoplift at least $423 of goods. There–we’re even now!

    • qualityleashdog says:

      That’s right. You can make sure you get a share by always stashing an item or two underneath the cart and forgetting to pay for it. If you’re caught, you’ll have the opportunity to pay for it and it won’t be the same as if you were caught with the item stuffed down your pantleg. Shoplifters are always going for unnecessary luxury items, but I say go for mundane items like food, then use the savings to buy the luxury goods. Food doesn’t have security tags to set off the alarms, either.

  5. JamesBenjamin says:

    Coming from a retail management background, the industry numbers also say that employees are the highest percentage of shoplifters, something insane like 75-80%. So we’re not losing $423 to shoplifters, we’re losing it to employees that steal from the stores they work in.

    • JamesBenjamin says:

      Wikipedia to the rescue:

      “An estimated 44% of shrinkage in 2008 was due to employee theft, totaling over $15.9 billion. Another 35% was due to shoplifting, totaling over $12.7 billion.[1] The prevention of this type of shrinkage is one reason for security guards, cameras and security tags.”

      From: http://en.wikipedia.org/wiki/Shrinkage_%28accounting%29

      So I was off in the numbers (probly inflated to make us watch our employees) but its still higher than “customer” shoplifters…

      • FatLynn says:

        Because it is SO damn easy to shoplift as an employee.

        • Gramin says:

          You don’t think it is???

          • FatLynn says:

            No, I was being totally serious. It’s also quite easy to get money from the till, help your friends shoplift, and ring people up on expired cards. I never did it, when working retail, but in another lifetime where I was more desperate…?

        • TheoSqua says:

          It’s CRAZY easy to shoplift as an employee. I worked at wally for a few years in electronics. There was a guy that worked there that would come in on his day off, put on his vest, load up a cart full of stuff, detag all the stuff at an unused register and then walk out of the store with all the items. The receipt checker would just assume that he was taking stuff to the storage bins outside, or delivering it to a customers vehicle and wouldn’t check their receipt.

          Electronic’s shrinkage dropped 20% after him and another guy were fired/transferred.

          • Gramin says:

            I worked at a retailer located inside a mall…

            An employee would go on a “trash run” which involved walking through the back hallways to the outside dumpster. During these “trash runs,” he’d take a pile of clothes with him and drop them off to his waiting friend. Crazy crazy easy.

      • MongoAngryMongoSmash says:
    • DanRydell says:

      I’m not sure what you’re getting at here – it doesn’t matter who is stealing the stuff, we’re paying for it.

      Also, employee-assisted theft is exactly what receipt checkers are intended to prevent.

    • wewanttheearth says:

      you get what you pay for

    • qualityleashdog says:

      Yeah, work for someplace like Wal-Mart or Kroger, be treated like crap, be paid $6.25 an hour, and you think the employees aren’t going to help themselves in order to feed their family that their paycheck doesn’t? I’ve been on the inside in both places, and being able to get out the door with free booze, cigarettes, food or cash was celebrated by 80% of the employees.
      I remember working as a teen at Kroger. We loved a good party but had both the expense of the beer and our inabilty to purchase it in our way. The solution was to come into the store to get some boxes for someone moving, stop by the beer on the way back out of the store and push your haul out the door.
      Of course we did have to worry about one manager that might actually look in the box, but we just employed a hot shift manager to go distract him, and that worked just fine. Everyone was in on it, from management arranging distractions, the butcher mislabeling the rib roast as chuck for a fellow employee, the boy at the next register voiding transactions and pocketing the cash. When I see store employees, I imagine they are no different, just a bunch of grifters. And be absolutely certain it is widespread, especially in a store that has no security cameras.

  6. redskull says:

    I just won’t go to the mall then. There, I just saved myself $423.

    • Griking says:

      I’m sure that this includes grocery stores as well. Of course you can always opt to grow all your own food at home…

  7. RevancheRM says:

    Enter text…I’ll let the rest of America pick up my ‘tab’ and I’ll keep with online purchases as much as possible.

    • JonStewartMill says:

      Yeah, it’s probably extremely difficult to shoplift from Amazon.com, which is where I make 90% of my non-grocery purchases.

      • Shadowman615 says:

        Well, there’s probably still employee theft. But at places like Amazon it accounts for more like 100% of missing items.

        I’m not trying to disparage Amazon employees or anything, just expanding on a thread above where it was mentioned that much of retail shoplifting comes from the store employees.

  8. Genuineduck says:

    *sips on hot coco, sitting at the PC in PJs doing all my holiday shopping at amazon.com with better prices, better selection, less lines, crowding, and other hassles, all while getting free/cheap shipping with Prime membership*

    Mall you say? Hm. *slurrrrp*

    • Gramin says:

      Now, if only I could buy my Banana Republic and Brooks Brothers clothes from Amazon… They are the only reason I go to the Mag Mile to shop. Everything else is done on Amazon.

      • Bohemian says:

        Both BR and BB sell online. Still no need to go to the maul.

        • Gramin says:

          True… but you have to pay shipping and tax :( The benefit to Amazon is no tax and (usually) no shipping costs. Now, I did learn something cool. If you order an item from a BR store that is in a state without sales tax, the won’t charge you the sales tax either! This is a great plus for me since I live in Chicago, home of the 9.75% sales tax. I’m being raped.

  9. wewanttheearth says:

    imagine how much the workers are getting robbed of!

    begin anti-retail worker and capitalism-is-the-shit-i-have-an-ayn-rand-tattoo comments in 3, 2….

  10. jennix says:

    Please. That $423 a year is nothing compared to what FREE PARKING costs those of us who don’t drive (by choice). I am always disgusted by the massive amounts of land paved over merely to corral unused vehicles for 8-10 hours a day.

    • DanRydell says:

      Well that’s an odd and likely inaccurate off topic rant.

      [citation needed]

      Also, in most of this country a car is a necessity. Get over it.

    • wewanttheearth says:

      THIS

    • DarthCoven says:

      Your smug is showing

    • shepd says:

      Just shop somewhere without parking. Most places have places like this that exist, but there is usually only one of each type of store.

      Personally, I do the opposite. And since most people agree with me, that’s why there’s only one of each store without parking. And in the areas without store parking, walking sucks because the cars are always driving around looking for that one street space that might come up.

  11. StutiCebriones says:

    If retailers ran on the airline or cellphone company model they’d lower prices and then pile on the Antitheft Regulatory Fees and the RFID Tag Recoupment Fee and the Receipt Checker Support Fee.

    … oh crap. Don’t let them read this.

  12. El_Fez says:

    So the simple solution? Shoplift $425 worth of goods this year. Easy peasy!

  13. Platypi {Redacted} says:

    How much does Amazon add on for shoplifting expense? Because 90% of my shopping is online, and the vast majority is there. I suppose someone else will have to pay my shoplifting dues, sorry guys!

    • FatLynn says:

      Believe me, the employees are still stealing shit.

    • Hoss says:

      Excellent analogy. If the story’s premise was correct, everything at Amazon would be cheaper than Walmart. I don’t think that’s the case. Pricing is determined by what the market will bear, but profits are determined by pricing less cost of goods sold. Thieves are stealing from profits

  14. Hungry Dog says:

    I stopped shopping at malls long ago. The massive crowds and annoying as hell kiosk people totally kill it for me as a consumer whore. I will occasionally do a quick insertion for some Auntie Ann’s Pretzels and nothing else.

  15. giax says:

    So, US has a much higher shoplifting rate and cost than say, Europe, but even with that adjusted $ 423 per person per year for the adjusted ripoff for the loss by shoplifting most things still cost less in US than in Europe.
    Such as electronics, clothing, books…

  16. lemur says:

    I’d like to see a CNN Money article detailing how much politicians, bankers and CEOs will rob me this year due to their illegal activities. I’d bet the number would be more than what is lost through shoplifting.

    But, heck, class interests must be protected so let’s get all indignant at the shoplifters and give the ruling class a free pass, shall we?

  17. Rain says:

    My retail training video talked about how for every $1 they lose to theft they have to sell $50 to make up for it. I don’t recall their math, I was too busy trying to block out the bad acting in the video.

    • Bsamm09 says:

      It’s their contribution margin: Sell 1 item at $50 subtract $49 of variable expenses you have income of $1 then you subtract your fixed costs out. Since they are fixed they do not change over the relevant range and are therefore sunk costs and are irrelevant. So to make one more dollar of income (not revenues) you must sell $50. Also, this is non-GAAP (cost) accounting.

    • wrjohnston91283 says:

      Sounds a bit high, but the basic concept is right – it will take the retailer many additional dollars in sales to recoup a single dollar stolen. Walmart’s cost of revenue last quarter was 75% of sales. So if you stole something that retailed $1 from them, it cost them 75 cents on average Their net income was about 3.4% of sales. Which means to make back that 75 cents, they needed to sell $22.35 worth of stuff to make back that 75 cents

  18. Hoss says:

    They need to check receipts at the door!

  19. Hoss says:

    BTW — the article is a bit slanted It suggest w zero theft, pricing would drop 1.5%. My understanding of business says shareholder profits increase by the savings

    • Bsamm09 says:

      They do. Profit margins increase –> Offer products that are similar/same as competition cheaper –> Profits increase. The price drop and the savings will never be equal. They will spend that money on other things.

    • user452 says:

      Agreed, there should be laws restricting profits.

      Supply should be the only cost relevant in pricing, not demand.

  20. sopmodm14 says:

    much of retail profit gets split into different aspects of the business

    its not like banking, where the profit is shared amongst executives and doesn’t trickle down

  21. sopmodm14 says:

    the staff i work with are outstanding, and maintain their credibility…those that aren’t, are quickly weeded out

    that being said, at our store, its mostly the customers who steal b/c we operate in a good neighborhood, but close to the inner city

  22. sopmodm14 says:

    at my store, everyone’s bags are inspected before they leave

    that being said, there are so many stupid rules the LP’s have to undergo that its all but impossible to stop shoplifters, and employees are too innocent enough to believe that guests would steal and get tricked

    i know that when i worked retail, a customer pointed out to staff that ppl were opening and stealing items in a certain area, and we escorted them out, and as a customer at a different spot, i reported it to the store also

    i’m not gonna let some other person steal from the store and jack up the price for the things i buy

    if you report it to the store, they take it seriously

  23. Radiating says:

    This $423 number is beyond idiotic, 40bn / 300 m = $133 per us citizen. This number assumes that only 1 in 3 people in America shop which is monstrously retarded.

  24. FrugalFreak says:

    who shops the mall? Amazon and zero shopliftting for the win.

    • Destron says:

      Theft happens at Amazon to. It’s just mostly employees and maybe some mail theft. But it happens. I have worked in those warehouse environments enough to know the people working there rip them off just as much.

  25. Destron says:

    Walmart does not lose as much on theft as one would think – they make it up by taking that money back from the associates that work there. Every quarter Walmart associates can earn what they call a MyShare bonus, but the amount of money the associates get is based on, among other things, the profitability of the store. If your store hits all it’s goals you can get the max payout, but the dollar amount drops for every percentage under the profit goal you are. The number 1 things that hurt the stores profitability more than anything else are theft(employee or customer) and accidents (employee or customer).

    The second major goal of course is sales, and theft also indirectly affects that as well, because often times when I worked there I would find that about 70% of the time product was not available to be sold because it had been stolen, and nobody had noticed this yet so the system still had on hands for that merchandise so it would never re order. Printer ink was the worst for this.

    Walmart sets aside the max payout for the MyShare bonus for every associate in the beginning, the when the numbers roll out the divvy it up. Most of it back to Walmart to make up for missed goals and a little to the associates for the goals the did hit.

    Having worked in several stores, both “high shrink” and not high shrink, I can attest that stores with lower shrink often tend to get larger bonuses.

  26. user452 says:

    Therefore, I must shoplift $423 of merch a year to break even.
    Thanks consumerist!

  27. anduin says:

    And thats why I shop online, way cheaper than brick & mortar and Im not paying for some nonsense like insurance.