It all started with shoppers ‘grazing’ on grapes as they shopped the store, often adding up to a significant shrinkage problem for the retailer…
Given these increasingly austere times, our skills in developing consumer demand may be in conflict with some consumers’ ability to pay. In fact in the case of teens ‘window-shopping’ after school, the appeal of some cosmetics may be such as to cause the young consumer to pocket a half-used tester, using the logic that the retailer has provided a means of prolonging the test, and is actually encouraging the shopper to continue the trial at home, before completing a purchase of a new pack…
Meanwhile, on a recent Saturday morning trip to Debenhams, I was bemused to find a consumer (not shopper) crouching down in the cosmetics department, out of sight of the demonstrators and counter-staff. She then proceeded to liberally apply almost a 200ml bottle of upmarket skin lotion to the exposed parts of her child and herself, before returning the empty container to the counter, and nodding at the counter staff before departing into the bright sunshine…
Apart from the indifference of shop staff, the issue can be further complicated by the fact that a shopper may not regard unauthorised use of a product as thieving. This presents an opportunity for the retailer in that as the ‘grazing’ shopper makes little attempt at concealment, the ‘thief’ can be more easily apprehended. However, when challenged, shoppers have been known to claim that they deserve a reward for buying, in that a £50 grocery purchase entitles them to a treat or discount. Besides, active sampling at the Deli counter, specialist shops encouraging tasting, and continuous in-store cosmetic make-overs can add to the ambiguity of the issue.
In fact, petit theft, defined as stealing an item of less than £50, may cause impoverished shoppers to think that anything less is acceptable. As a result, in-store grazing ‘condoned’ by the retailer and left unchecked, can lead to an escalation of the problem. Regular shoppers, encouraged by fellow grazers and a seemingly tolerant environment, can then graduate from partly used testers to complete packs, before moving on to marketing-induced complementary products in a cosmetic range.
From these humble beginnings, more expensive top-end cosmetics and appliances may not seem like a big step…
There are obviously problems with apprehending a petit thief in the store, in that in the first place the retailer is accusing an ‘innocent’ thief, who happens to be a regular customer. Moreover, young teens, especially female, pose problems for male security guards, inside or outside the store. An added complication is that, in law, a suspected shop-lifter cannot be accused until they have left the store, and then two witnesses are required in order to successfully press charges.
However, it is essential that the retailer be seen to press charges and prosecute shoplifters. For instance, a retailer making 4% net profit has to make incremental sales of £125 in order to recover £5 stolen in store.
In reality, most shoppers probably stop at tester-stage…but those that graduate to regular thieving can pose a problem. For H&B suppliers there is the issue of ownership of the problem in that a shoplifter moving from tester-theft to large scale items may cause the retailer to attempt to shift some of the ‘blame’ for this aspect of shrinkage to the supply chain, in effect penalising the supplier for producing a product that is attractive and thereby susceptible to above-average shrinkage.
Whilst tester-shrinkage will always be regarded as wastage, escalating shrinkage can seriously damage sales of regular brands as the retailer attempts to restrict access to expensive products. For the consumer, this can mean reduced opportunities to buy at point of purchase. Inaccurate stock-counts can cause reduced availability and challenges to data credibility and insight, which in turn may sour supplier-retailer relationships.
In order to begin to deal with petit-shrinkage, it is important that retailers clarify to staff and shoppers, the distinction between legitimate sampling in-store, and unauthorised removal of product from the store. Then begins the slow process of re-educating shoppers (and their teenage offspring) to the realisation that taking products without paying is wrong and carries a penalty…
Alternatively, why not encourage them to become shareholders, hoping that they will then see shrinkage of any kind as a reduction in their own profits, and not another form of dividend…
