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Could the 5p bag charge increase shrinkage?

Could the 5p bag charge increase shrinkage?

As of October 5th, all retailers who employ more than 250 people across the UK have to charge 5p for plastic carrier bags. This has proven to be an unpopular move with many shoppers, many of whom can easily afford the charge but resent having to pay for something that has been given away free for so long. Unfortunately for retailers, this could have some unwanted effects.

Back in 2012, a very similar law was enacted in Scotland and Wales, and the reaction at the time was the same as it is now. However, one unexpected outcome was an increase in shrinkage as customers stole baskets. This might seem like an extreme reaction, but it was one that some supermarkets had to deal with in a large way.

For example, a Tesco store in Ruthin, north-east Wales, was left with just 16 baskets after customers began to take them from the supermarket in place of carrier bags. According to the Daily Mail, one customer was informed by Tesco that 400 to 500 baskets had been stolen in total.

This could have potentially cost the store over £2,000, radically increasing shrinkage. While shopping baskets are not a high-value item, retailers will still suffer negative effects from having them taken from their premises in large numbers.

To prevent this increase in the cost of shrinkage, retailers should consider upgrading their security. On the one hand, this might help prevent the loss of baskets and other small items, which add up over time. On the other, it might allow you to offset the cost of things like basket theft by cutting down on more serious crime.

Retail crime cost UK businesses a total of £603 million last year, an 18 per cent increase on the year before. Part of the reason for this increase is that the average cost of each theft has risen by 34 per cent in the last year, increasing from £179 in 2014 to £241 in 2015.  Preventing these large-scale shoplifting incidents will help cut down on shrinkage.

One thing that can assist with this is video analytics. This technology is an improved version of CCTV that can intelligently monitor high-risk areas of a store. For example, it could be combined with a pressure sensor on a shelf containing valuable goods. 

The technology could also be used to monitor a changing room entrance, enabling security staff to check footage of each customer when they enter and leave and compare the two. This will help to pick up on any discrepancies, so your loss prevention team can investigate straight away if necessary.

Measures such as this are incredibly useful for cutting down on retail shrinkage. Preventing theft is key to slashing your running costs and making sure you and your customers don't lose out.

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