This paper presents findings from research amongst European grocery retailers
into their methods for measuring shrinkage. The findings indicate that: there is
no dominant method for valuing or stating shrinkage; shrinkage in the supply
chain is frequently overlooked; data is essential in pinpointing where and when
loss occurs and that many retailers collect data at the stock-keeping unit (SKU)
level and do so every 6 months. These findings reveal that it is difficult to
benchmark between retailers due to inconsistencies between measurement methods
and that there are opportunities for many of the retailers surveyed to improve
their shrinkage measurement by adopting known good practice
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