il crime have increased since the previous study conducted in 2019. However, what’s particularly alarming is the substantial rise in the costs attributed to customer theft, which have surged by 20 per cent between 2019 and 2022. Customer theft has long been recognised as retailers’ primary source of loss, accounting for about half of all crime-related losses. As a result, substantial investment and effort have been dedicated to this issue by Loss Prevention (LP) teams. When we sought answers from LP managers, enquiring about the tactics customers engaging in theft employed, their responses were both enlightening and disheartening. Across all categories, the most common tactics consistently required no prior experience, skill or specialised equipment. It is perplexing to realise that the crimes with the highest financial impact on businesses are not only increasing in frequency but also using methods that are incredibly accessible. This is the case despite retailers deploying increasingly sophisticated physical and technological solutions aimed at prevention and deterrence. For LP managers, the escalating frequency and intensity of customer theft pose a pressing dilemma unlikely to dissipate soon. Experts forecast another six months of interest-rate increases expected to exacerbate cost-of-living pressures. So, what should LP managers do in the face of rising and sustained customer theft? Management is unlikely to approve increased LP budgets in the current fiscal environment. Heightened security measures can mitigate losses, but they risk eroding the customer experience – and revenue – if other businesses do not follow suit. The trade-offs in heightened security The first thing LP managers need to accept is that there are no perfect solutions to this dilemma, only trade-offs. While omnipresent monitoring and heightened security seem logical, they risk sending the wrong signals to customers, potentially deterring them from purchasing. Therefore, management and LP teams must determine what level and type of loss they will tolerate while preserving the intended customer experience. Furthermore, LP executives must stay informed about the effectiveness of their current security measures. Regrettably, reliable, high-quality information about this topic is scarce, as Professor Adrian Beck (University of Leicester, UK) recently observed. Beck reviewed the available academic literature for his 2016 article, “Amplifying Risk in Retail Stores: The evidence to date on making shop thieves think twice” and found that most studies are either low quality or outdated. This is especially concerning, given the rapid pace of change that characterises the retail sector, as strategies and approaches that were once effective can swiftly become obsolete. What deters shoplifters? Recent research into the effectiveness of various security measures at preventing customer theft provides some insights. In a study titled “ ‘Thinking Thief’ in the Crime Prevention Arms Race: Lessons learned from shoplifters”, led by Professor Nicole Lasky (Northeastern State University, US) and published in Security Journal, active shoplifters wore special eye-tracking glasses while pretending to steal items from two national retail chains. Following the theft, Lasky and her team interviewed the participants to get their thoughts on the security measures in place and the tactics they use to overcome them. None of the participants were detected by store employees. The study identified some specific security measures found to be generally ineffective or easily defeated by shoplifters. For example, mirrors and public viewing monitors were usually ignored. However, a few participants used them to monitor store staff and identify areas to conceal or tamper with the merchandise. Participants did not perceive CCTV as an effective deterrent, believing they were not being actively monitored or presuming that dummy cameras were on display, particularly in low income areas. Nonetheless, many shoplifters admitted to adopting several countermeasures to avoid detection by CCTV. This is consistent with academic literature, which suggests that CCTV has a deterrent effect but that it is often short-lived. LP measures that did deter shoplifting included the implementation of electronic article surveillance (EAS), as many offenders were hesitant to target locations equipped with this technology. To circumvent this, shoplifters often remove goods from packaging in areas with little or no surveillance or focused on lower-priced items without security tags. Also, many knew from personal experience that the frequency of false alarms at EAS gates typically results in employee complacency and, therefore, provides potential circumvention. Participants generally avoided special packaging on high-risk items, as they believed it increased their chances of apprehension due to the increased size and concealment difficulty. However, some participants were not deterred by these measures and could still find ways to get past the enhanced security features. These criminals may use specialised tools, such as magnetic detachers or wire cutters, to remove products from their packaging. Item placement appears to be a crucial factor in deterring shoplifting, with many participants in the study avoiding items that were locked up or near the register. Surprisingly, a few participants did attempt to steal things that were locked up but were stopped by alert store employees who insisted that the items be purchased directly at the displays. This suggests that well-trained and vigilant employees who can identify potential security threats and intervene appropriately can often assist in preventing customer theft. Retailers may benefit from investing in employee training programs to enhance security measures and by developing proactive strategies to mitigate loss due to customer theft. Regular reviews of security measures and ongoing analysis of shoplifting trends can help retailers identify weak spots in their security infrastructure and address these vulnerabilities to prevent future losses. Strategies for optimal loss prevention While a single study should not be taken as definitive, several key takeaways from this research can be applied to LP efforts more generally. First, it is essential to recognise that many security solutions do not operate in isolation and require complementary components to function optimally. For example, while CCTV may be installed, it is only effective if actively monitored. Similarly, the effectiveness of EAS can be undermined if there is not a proper staff response to gate alarms. Retailers must ensure that their security measures are designed to work in harmony and not in isolation from one another. Second, the involvement of employees can significantly influence the effectiveness of security measures. In several analyses of security measures provided, employee vigilance or apathy played a crucial role in determining whether these measures were effective. It is essential for retailers to cultivate a culture of security and involve employees in profit protection and policy adherence. One solution for this is to perform periodic security compliance checks to determine the level of employees’ compliance, just as ‘secret shoppers’ check customer experience. Retailers have an opportunity to address the problem of customer theft without undermining customer experience by ensuring that their security measures are functioning as intended and underpinned by a robust process that can support their effective implementation. They must also cultivate a security culture among employees and involve them in security planning and policy enforcement. This story first appeared in the August 2023 issue of Inside Retail Australia Magazine.