Shoplifting, employee and supplier fraud, organized retail crime and administrative errors cost the nation’s retail industry 2.41 trillion won ($2.13 billion) over the past year, an international report found Thursday.
The amount was equivalent to 1.3 percent of the industry’s total sales in 2011, according to the Global Retail Theft Barometer Report, which monitors the cost of “shrink” in the global retail industry.
Korea was first included this year on the list of 43 countries to be surveyed on their shrinkage rate and retail industry.
Despite an overall decrease in cases, losses increased to $119 billion last year, which, coupled with fiercer competition and price hikes, led to a decline in the industry’s profit margin, the report said.
In Korea, the largest portion of shrink was caused by shoplifting with 52.8 percent, just below the Asian average of 53.3 percent between July 2010 and June 2011. The amount reached 1.27 trillion won.
Employee theft with 23 percent and administrative errors with 16.7 percent followed.
In order to fill the loss, the retail industry was found to have charged an average of 50,956 won per person or 140,132 won per household above the Asian average.
By Lee Ji-yoon (email@example.com