You are most certainly correct and I suppose without the actual numbers its a bit of speculation.
My main point was that there is no additional cost, even if you exceed the shrink budget. The losses are all written off because with a loss prevention department you have shown, to the insurance company /or IRS, that you are putting in a reasonable effort to deter theft. Stores don't want anyone to actually stop people for a number of reasons the main one being they are writing the loss off or being reimbursed.
An employee getting harmed, the thief getting harmed, employee's getting summons to court, another customer getting harmed are all more costly than just documenting what was stolen. Even in the cases where they build up evidence so that the amount gets close to grand larceny is just paper work. They already have people and technology deployed to do the work its not a new investment.
I did a bit of digging and while "theft" is listed as one of the items "reduced foot-traffic"[2] seems to be the main culprit. They throw out some fancy percentages but the quoted stats seem to be from 2015 and theft is only 1% of their annual revenue[7]. It would be interesting to see the raw data.
My main point was that there is no additional cost, even if you exceed the shrink budget. The losses are all written off because with a loss prevention department you have shown, to the insurance company /or IRS, that you are putting in a reasonable effort to deter theft. Stores don't want anyone to actually stop people for a number of reasons the main one being they are writing the loss off or being reimbursed.
An employee getting harmed, the thief getting harmed, employee's getting summons to court, another customer getting harmed are all more costly than just documenting what was stolen. Even in the cases where they build up evidence so that the amount gets close to grand larceny is just paper work. They already have people and technology deployed to do the work its not a new investment.
I did a bit of digging and while "theft" is listed as one of the items "reduced foot-traffic"[2] seems to be the main culprit. They throw out some fancy percentages but the quoted stats seem to be from 2015 and theft is only 1% of their annual revenue[7]. It would be interesting to see the raw data.
[1] https://www.jacksonville.com/story/news/2015/01/15/after-tak... [2] https://www.al.com/news/2023/04/target-store-closings-2023-s... [3] https://www.cleveland.com/news/2023/04/target-to-close-store... [4] https://www.irs.gov/pub/irs-pdf/p584b.pdf [5] https://www.reuters.com/article/us-wal-mart-stores-theft/wal... (from 2015) [6] https://www.wsaz.com/2022/12/09/walmart-may-close-stores-inc... [7] https://blog.gitnux.com/walmart-theft-statistics/