As shop theft reaches record levels in convenience stores globally, retailers are doubling down on retail crime, increasing their security budgets and turning to new technologies, including AI-powered surveillance solutions, to combat the growing problem.
In this detailed feature we explore how new strategies and new AI based tools can provide practical solutions, continuing on from our recent coverage of strategies to manage staff harassment.
The UK has a particular challenge in this respect.
The British Retail Consortium warn that UK retail crime is now “spiralling out of control” with 20 million incidents in 2023/2024, costing UK retailers £2.2bn, up from £1.8bn in the previous year.
In fact in the UK, verbal and physical attacks, violent threats, and sexual and racial abuse in shops rose to more than 2,000 incidents a day in the year to end 31 August 2024, up from 1,300 the previous year and more than three times the 2020 level.
Helen Dickinson, the chief executive of the UK’s BRC, says: “Retail crime is spiralling out of control.
People in retail have been spat on, racially abused, and threatened with machetes.
Every day this continues, criminals are getting bolder and more aggressive.
We owe it to the three million hardworking people working in retail to bring the epidemic of crime to heel. No one should go to work in fear.
“With little faith in police attendance, it is no wonder criminals feel they have licence to steal, threaten, assault and abuse.
Retailers are spending more than ever before, but they cannot prevent crime alone.”
The UK government is starting to take action to deal with the sharp rise in shop theft with a range of measures, including new funding and police training, while retailers and other stakeholders are working more collaboratively to tackle the crime wave.
Richard Pennycook, former CEO of the Co-op and an advisor at SeeChange, an expert in Vision AI technology, says it’s the impact on store staff which is helping to drive legislative change and engagement.
There’s also a new collaborative approach to tackling retail crime, he says.
“Retail CEOs are wanting to call it out. It’s the traumatic effects on people, which really engage the conversation.
Dan Munford and Anthony Wysome visit the SeeChange team in Manchester
“[Security] was very much seen as ‘do your own thing’,” he continues.
“But, because it’s become so endemic, that’s changed. Retailers are now talking about co-operation.”
Perran Jervis, partner and head of retail and consumer goods at UK national law firm TLT, agrees: “The social and economic consequences of this issue cannot be underestimated,” he says.
TLT surveyed the UK’s top 100 retailers and found retailers are facing an unprecedented surge in retail crime: 88% reported incidents of shop theft, 81% reported physical abuse, and 86% recorded verbal abuse.
Further, TLT’s report found 44% of retailers reported increased employee turnover and 42% faced recruitment difficulties due to safety concerns.
“The report highlights how the industry is innovating to address these challenges, but many retailers do not have the capacity, financially or operationally to tackle this alone so collaborative action and government support are essential to create a lasting solution to the problem,” Jervis maintains.
According to Pennycook, retail theft has become endemic for a number of reasons: the cost of living crisis; a break down in the social contract and a “chipping away of what we used to think of was proper behaviour”; self-checkout, which removed the barrier to some dishonest behaviour as shoppers did not have to pass through a manned checkout; plus the carrier bag levy, which opened the door to customers bringing their own bags into store.
“The problem is growing due to the cost-of-living crisis, lack of repercussions for the majority of shoplifters and the rise of ‘shoplifting-to-order’ by organised gangs,” says John Nussbaum at Kingdom Retail Security.
“We are seeing an increase in crime from the cost of living now – we’re seeing a bit more ‘petty’ crime, where some people put a few items in their basket and a few in their bag, attempting to only pay for part of the shop.
“This also forms part of local shoplifting, from regular families that just can’t afford to buy a full shop. We have seen an increase in our convenience stores with this sort of retail crime,” he says.
Like other cost rises – the increases in NICs and National Living Wage in the UK announced in last autumn’s budget – losses from theft and increased expenses will be passed on to the customer: the Centre for Retail Research has estimated shoplifting added £133 onto the cost of an average household’s shopping bill each year; while nearly half (48%) of retailers TLT surveyed said that they will have to pass the increased expenses incurred onto consumers through higher prices.
Retail crime solutions
Retailers are increasing their investments in technology to combat the growing problem of retail crime.
The BRC found that the amount spent on crime prevention is at a record high, with retailers investing £1.8bn on measures such as CCTV, more security personnel, anti-theft devices and body worn cameras, up from £1.2bn the previous year.
TLT found two thirds of its respondents have increased their security budgets and are increasingly turning to technology such as AI-driven analytics and biometric security systems as critical lines of defence.
In January the UK high street retailer Poundland announced its largest-ever investment in anti-theft technology and security to address retail crime.
Measures include the roll out of Motorola body cameras to store staff.
These record incidents and provide a visual deterrent for offenders and have driven an 11% decrease in violent against colleagues plus a marked reduction in shoplifting and theft in trials.
Communication headsets have also been introduced to allow staff to communicate quickly when incidents occur and Poundland has given its security teams backing to detain suspects in-stores; as well as employing more undercover guards in stores.
“The rate of store theft and colleague abuse has accelerated significantly across our stores in the last 18 months, and this has been very challenging for our people,” says Poundland’s head of loss prevention Christina Jesty.
“Whether it’s store theft undermining all our colleagues’ hard work, or incidents of violence and abuse making our colleagues feel unsafe at work, something must change.
At Poundland we pride ourselves on being a value-led high street retailer, where protecting our colleagues goes hand in hand with protecting our prices.”
Iceland is also investing in staff safety with the recent launch of VoCoVo communication headsets across its 1,004 UK stores.
The headsets are designed to boost operational efficiency and the customer experience but ensuring colleagues remained and felt safe was a core focus of the project, says Olivia Robinson, head of UK and EU at VoCoVo, who also works with Asda and Co-op and is active in over 13,000 stores with 250,000 daily users.
Staff welfare and support has become a top focus for Kingdom Retail Security too.
“The biggest issues we are still experiencing is the violence that comes with shop lifting,” says Nussbaum.
“This is nearly a daily occurrence – some serious assaults have taken place and it’s key that our training and support is kept up to date.
In some areas, where this sort of shoplifting is high, we provide additional support with enhanced security staff, like a mobile support unit, to assist local areas and add support to our staff and customers,” he says.
“We work closely with our store managers to ensure all staff know what to do in these situations, and they know to notify security immediately.
We also use crime risk analysis tools to assess the times and dates that shoplifting incidents are happening so we can ensure we have enough security officers on site.”
Elsewhere, Harrison Retail, which provides bespoke merchandising solutions and loss prevention products for retailers, recommends stores identify and address potential areas of weakness.
“Areas or operations vulnerable to crime may include faulty self-checkout systems, unrestricted access to high-value items, disorganised shelves and CCTV monitoring systems.
In most cases, the efficacy of visible deterrents is an invaluable tool, whether that be anti-theft and security camera signage or a robust employee shopfloor presence,” says Rolf Whiteman, sales director at Harrison.
“As streaks of panic taint the retail sector, some retailers have taken a more drastic approach to anti-theft by removing self-service checkouts from stores.
This, however, risks compromising the overall shopping experience and appeal to customers,” Whiteman says.
Instead, Harrison advises retailers look to solutions that simultaneously prevent shoplifting in stores and maintain a positive in-store experience for shoppers without compromising convenience or environment.
“Retailers should assess their current shelf management and consider integrating shelf and dispenser solutions that structure and divide product displays in such a way that prevents thieves from sweeping shelves,” Whiteman says.
“Shelf solutions, including dual, gravity, and locking risers, all present barriers to removing multiple items from the shelf at one time without hindering employees’ access when replenishing stock or a customer’s shopping experience,” he adds.
Self-checkouts and AI
While self-checkouts have been partly demonised for their role in shop theft – they are blamed for around 20-25% of supermarket losses rising to 40% with mobile scan and pay solutions – and have been removed from some stores, they are not going anywhere and for a number of factors.
Firstly, they improve the overall shopping experience and appeal to customers, particularly Gen Z, who have a preference for frictionless shopping and are more likely to switch retailers for check-out free stores.
Two, they are labour-saving and, unlike manned checkouts, they are always on.
This is key in the current climate when retailers have warned of a £7bn rise in annual costs due to the changes announced in the autumn budget.
Thirdly, and increasingly relevant in light of the latest crime figures, self-checkout combined with AI can cut losses by up to 50%.
Enter SeeChange, an expert in Vision AI technology, who partners with Diebold Nixdorf on store checkouts (PoS devices) and Mitie on security (CCTV) to create connected and secure stores.
A connected store with Vision AI will reduce losses, enhance the shopper experience and improve operations, according to Jason Souloglou, CEO at SeeChange.
It can also help retailers understand exactly where their losses are in-store and take preventative action.
“Connecting feeds from sensors and devices into a computer vision or loss prevention AI platform enables retailers to monitor in the aisles, at the checkout and exit for a safer and more efficient store environment,” Souloglou says.
“Significantly, it enables retailers to answer that critical question of how much shrink is in the back of the store, in the aisle, at checkout and how much inventory is being walked out of the store,” he says.
AI use cases
The SeeChange / Diebold Nixdorf solution is is currently being deployed at French retail group Groupement Mousquetaires (Intermarché, Netto and Bricomarché,).
At the checkout, Vision AI can help detect unscanned items and differentiate between international and unintentional fraud.
Critically, this reduces the number of staff interventions, which cuts losses and boosts staff morale.
Intermarche has introduced the SeeChange / Diebold Nixdorf solution on self-checkouts at its Toulon store, for example.
The retailer found that often items were not scanned due to handling errors. One common error concerns avocados – as customers don’t know if they are a fruit or a vegetable.
These types of errors cause losses for the store of up to 3% of all transactions but, since self-checkouts were upgraded to leverage computer vision and AI, that figure is around 1%.
Staff also feel less anxious as interventions have been reduced by 15% meaning they can focus on helping customers, versus uncomfortable intervening.
In Intermarche’s case, the video evidence from the self-checkout is relayed to the store staff who can choose whether to intervene.
Other retailers elect to replay the footage at the checkout in order to nudge the shopper towards the right behaviour and to correct their miss-scans, etc.
SeeChange’s fresh produce recognition technology assists in correct item identification but also speeds transaction times.
Aldi Süd piloted the technology on Diebold Nixdorf self-checkouts in Cologne.
Items were recognised four times faster, which means transactions per hour can be increased by up to 40%.
Further, the tech means more shoppers with fruit and veg will be willing to use the self-checkouts and staff interventions could be reduced by up to 45%.
Future insights
While retailers grapple with today’s shocking retail crime figures, SeeChange is already looking ahead to tomorrow’s challenges and the role Vision AI technology can play.
While current solutions enable retailers to spot anomalies in real time, it also fulfils an ‘offline’ role, collating insightful data over a period of time.
This gives retailers access to macro versus micro trends, says Souloglou.
“For example, we learned from a trial in Belgium, in a city centre store, that the most stolen item was sushi.
It was not an instantaneous finding but an interesting insight learned over a period of time.
We also learnt that the self-checkout with the highest level of fraud, was the one closest to the attendant station – sounds illogical, until you realize it’s because the attendant is often not present at the station,” he says.
Those types of insights allow retailers to understand which stores in a network are the most targeted, the times of day that show higher fraud levels, or if the layout of a self-service area is a contributing factor.
“Armed with these insights, you can move to the next level, which is predictive action.
That predictive element is the next evolution of this technology,” Souloglou says.
View article source here.
Subscribe to our free mailing list and always be the first to receive the latest news and updates.