September 11, 2023

Retailers at a Loss

As if retailers didn’t have enough on their plates keeping up with customer demands, theft continues to escalate in North America, drastically impacting their bottom lines. AutoStore can help.


An estimated $94.5 billion was lost across retailers in 2021, up 4.07% YoY. Walmart estimates $3 billion annually due to “shrink” – a term used to describe consumer and employee theft, as well as other types of inventory loss. Target predicts $1.3 billion in loss from inventory shrink in 2023 and The Home Depot’s gross margin fell 33.7% in the first quarter, attributed primarily to…you guessed it, SHRINK.

Retailers like those mentioned above, as well as Walgreens, Macy’s, Best Buy, Bed Bath & Beyond, and others have temporarily or permanently closed stores in response to organized retail crime (ORC). Companies like Nike reported a negative impact to their stock prices due to ongoing loss. Unfortunately, this problem isn’t going away as ORC was up 26.5% in 2021 according to 63 surveyed retailers. Statistics continues to trend upward, with 38% of it happening in-store. “We are at a critical juncture,” a spokesperson from Nike wrote.

A National Retail Federation retail sales revenue loss pie chart

Companies are reacting in various ways and loss prevention budgets continue to swell, checking in at 1.72% of sales on average last year. Best Buy is investing in additional security personnel, monitoring equipment, and secure areas for high-value items. Macy’s and Nordstrom rolled out radio-frequency identification (RFID) tags to accurately track inventory, as well increased security guards and cable-locked high-value items. While these measures can be effective, a delicate balance is required, as too much visible security can be off-putting to consumers and have the unwanted effect of driving some away. Overall, it’s not enough, as Capital One Shopping Research reports that roughly 2% of shoplifters are caught and the average shoplifter is arrested once out of every 100 incidents.

How can AutoStore prevent theft?

AutoStore is theft-proof due to its cube storage design. Only the very top layer is accessible by humans. Even accessing the top level would require significant effort and can easily be monitored by camera. Additionally, the specific inventory location is unknown, making it extremely difficult for targeted theft of high-value items. Reducing the required “touches” or physical access to goods reduces the opportunity for loss to occur (including accidental damage).


AutoStore can significantly improve inventory tracking, as well. Once inducted into the system, an item’s every movement is continuously controlled and tracked. Items are scanned in and out of the automation when human interaction is required. At these workstations, known as Ports, consumers can be closely monitored and the action can be logged via an employee’s access credentials.

An AutoStore in-store retail concept from exterior

How would AutoStore fit into my store?

Envision your brick-and-mortar location of the future. Retail replenishment takes place more efficiently, resulting in less touches and less personnel. This translates into less chance for shrink. Stockroom inventory is located in a secure location inaccessible to humans. With optimized stockroom storage density and efficient automated item retrieval, less inventory is required in vulnerable areas on the store floor. That lowers risk, reduces management, and further lowers opportunity for theft. Customers’ interactions with the products can be shifted in-part or entirely to secure PickUpPorts™ or staffed areas, which has the added effect of increasing customer engagement.

AutoStore’s system is extremely flexible, so whether planning for a new location or retrofitting an existing location, it will fit your needs. It blends into the retail environment while allowing for a renovated in-store customer experience, 24/7 secure customer pick-up for e-commerce orders, and seamless integration with fitting rooms all with enhanced inventory control.

An AutoStore in-store retail concept from the interior

What is the ROI for an AutoStore system?

AutoStore is a significant capital expense but even large companies like PUMA have achieved quick ROI.

Our team of business development managers (BDMs) will guide your team in building a solution concept and ROI model to make sure your payback objectives are met. Using our proprietary tools and years of experience, we can build a solution that makes sense today and show you the path to your system of the future. Loss prevention certainly moves the needle but there are many important justification factors to consider when looking at an in-store solution:

  • Inventory shrink data – focus on the stores shown to have the highest $ loss/risk
  • Operation expense for management of stockroom and store floor inventory
  • High inventory control and capacity, reduction of stock-out
  • Space utilization and inventory density – every square foot costs money, could your footprint be reduced or would it be beneficial for a larger assortment of goods?
  • 24/7 operation, faster last-mile delivery, Click & Collect  
  • Sustainability  - smaller facilities, less building consumption, fewer deliveries

Let AutoStore’s team build the business case for you like we’ve done for Decathlon, DAPPER, Longinges, and others.

To learn more, check out our case studies.

“AutoStore is theft-proof due to its cube storage design. Only the very top layer is accessible by humans. Even accessing the top level would require significant effort and can easily be monitored by camera.”

Ryan Nosler
Business Development Manager, North America
General Inquiries

Want to learn more about this topic?

Talk to your local expert.
Let's talk
Let's talk

Want to learn more about this topic?

Talk to your local expert.
Let's talk
Let's talk


Get your complimentary copy

No items found.