Loss prevention is one of retail’s main concerns — and this is no coincidence. To give an idea of this scenario, the “ABRAPPE Survey on Losses in Brazilian Retail 2024” pointed out that the retail sector experienced an approximate 10% increase in losses related to shrink. In numbers, this represents a bottleneck of nearly R$35 billion in company revenue.

The study also indicates that supermarkets are the most affected by losses in retail, due to factors including:

  • In-store theft;
  • Operational errors in stock management and inventories;
  • Products unsuitable for sale.

The numbers show that neglecting loss prevention can compromise financial results and competitiveness. Furthermore, many retail businesses still make basic mistakes that make reducing losses more difficult.

The positive side, according to ABRAPPE, is that there was a 27% increase in the number of companies with a loss prevention department. With this in mind, this article highlights the role of the loss prevention area and offers tips on how to overcome the most common failures in stock control processes.

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What is the role of loss prevention in retail?

Loss prevention basically involves a set of strategies to identify, control, and reduce waste and shrink in inventory, which, as we’ve seen, directly impact retail financial results. As noted, these losses can be caused by different reasons — including theft and fraud, as well as managerial errors in stock management and turnover.

Regarding these causes, ABRAPPE reports an alarming figure: according to the association, around 84% of losses are related to operational shrink, internal and external theft, and inventory errors. This number reinforces the importance of the loss prevention sector, which works to monitor processes, analyze data, and implement continuous improvements to help companies reduce losses and optimize operational efficiency.

Key functions of the department include:

  • Analysis of loss indicators;
  • Stock and inventory audits and control;
  • Training teams in prevention;
  • Use of technology for monitoring and in-store security;
  • Definition of strategies for loss reduction;
  • Continuous dialogue with other departments (such as finance and senior management).

The success of the loss prevention area depends on best practices, which include combining well-defined processes, cutting-edge innovation, training, and valuing teams.

In this way, it is possible not only to ensure greater control over retail losses but also to foster a culture of security that benefits both consumers and employees.

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5 Mistakes in Loss Prevention You Need to Avoid

For companies to be successful in retail loss prevention, it is also important to know the most common management mistakes. By understanding operational failures, businesses can define more effective operational paths and standards to reduce their impact.

Here is a list of the 5 main mistakes in retail loss prevention:

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1. Minimizing the impact of losses on results

‍A common mistake is underestimating the financial impact of losses on daily retail operations. As mentioned, small daily losses accumulated throughout the year can represent a significant portion of the sector’s revenue.

To avoid this mistake, the first step is to quantify losses and assess their real impact on company profit. From this data, strategic measures can be adopted to minimize the losses.

2. Not performing regular inventories

‍Stock control is essential for loss prevention, yet many companies still neglect regular inventories. Without this practice, internal or external theft, diversions, and stock control errors may go unnoticed, increasing waste and shrink.

An important measure is to implement a regular inventory schedule, ensuring discrepancies are quickly identified and corrected by managers.

Beyond inventory, the loss prevention team should analyze all stock movements, ensuring a more accurate view and preventing errors and fraud.

3. Not calculating the average loss per store

‍Many companies do not track losses individually per store. Without this detailed analysis, it is difficult to identify which units need adjustments and which positive practices can be replicated across the network.

The ideal is to calculate the average loss per store and compare the results. This allows patterns to be identified, mistakes corrected, and strategic solutions applied to optimize operational results.

4. Not investigating the root cause of losses

‍Simply identifying losses is not enough to correct them. A frequent mistake is treating the consequences without investigating the actual causes.

It is essential to go beyond numbers and conduct a detailed analysis to understand what is generating losses. This may be an operational problem, security failures, or lack of team training.

Moreover, understanding which areas face the highest risk of losses is also a decisive step for successful control.

For example, in supermarkets, the FLV category (fruits, vegetables, and greens) accounts for 65% of losses, according to a recent survey by the São Paulo State Retail Food Trade Union (Sincovaga).

5. Not investing in the pillars: people, processes, and technology

‍Loss prevention depends on integrating three fundamental pillars for retail growth: people, processes, and technology. This means that, for the prevention area to successfully build a culture of security and financial optimization, continuous investment is necessary in:

  • Training teams on security processes, loss control, and awareness of operational deviations;
  • Standardization, control, and continuous improvement of prevention routines — from stock management to analysis of strategic indicators;
  • Implementation of new monitoring and control technologies that support companies in loss prevention.

It is also worth noting that the person responsible for Loss Prevention must have the right profile: analytical skills to collect and interpret data, clear and effective communication, adaptability to new challenges, and, most importantly, a results-oriented mindset.

Neglecting any of these pillars directly affects the success of loss prevention and is “felt in the wallet” of retailers.

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How to prevent losses in retail? 3 essential strategies!

Now that you know the most common mistakes, here are three strategies that make a difference when optimizing loss prevention in retail:

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1. Develop a loss prevention plan

‍A structured plan is essential to effectively reduce losses. This plan should include, among other points:

  • Definition of loss goals and indicators;
  • Stock control procedures;
  • Strategies to prevent theft and fraud;
  • Focus on controlled and continuous action processes;
  • Team training on best practices.

Having a well-defined loss prevention plan also involves alignment across different business areas, ensuring all departments strengthen a culture of prevention.

2. Invest in digitalization of security processes

‍Technology is a major ally in loss prevention. Solutions such as smart camera monitoring, EAS tags, and inventory management software help reduce risks and improve operational efficiency.

Additionally, process automation minimizes human errors and provides greater control over retail operations, allowing employees to focus on strategic activities for company growth.

3. Strengthen a culture of prevention

‍Finally, for the loss prevention area to be truly effective, it is necessary to create an organizational culture focused on this goal. This involves engaging the entire company, from cashiers — who play a decisive role in checkout flows — to managers and business leaders.

By reinforcing the pillars of people, processes, and technology, retailers have a much higher chance of reducing losses, theft, and optimizing financial gains. Continuous training, efficient internal communication, and practical solutions that facilitate daily operations help maintain this commitment, supporting long-term business growth.

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Count on Inwave to enhance loss prevention in retail

Technology, as highlighted, is one of the essential pillars to optimize loss prevention, and Inwave offers innovative solutions for this critical area. With the Darwin Platform, your company can have:

  • Real-time monitoring;
  • Artificial intelligence for risk analysis;
  • Automation of security processes.

Additionally, the solution allows image data cross-referencing and remote management through an easy-to-use platform that centralizes all checkout operations in a single tool.

This makes the detection of fraud, theft, and operational errors more efficient, reducing losses, improving security, and ensuring a better experience for your customers.

All of this contributes to building a culture of prevention, with aligned teams and well-executed processes.