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BizReport : Ecommerce archives : July 23, 2012

Online accounts for 4% of all retail fraud in UK

The recently released Retail Fraud Survey reveals that online retailers in the UK, facing challenging financial times, are unwisely cutting back on fraud prevention spending.

by Helen Leggatt

retail fraud survey.jpgAccording to the study, conducted by Martec International, retailers spent 0.7% of sales on preventing loss this year compared to 0.8% in 2011.

As a consequence, retailers experienced losses of $5.3 billion (£3.4 billion) due to theft and fraud in 2012, a 10% increase on last year.

The Retail Fraud Survey also highlighted a change in consumer shopping habits with online purchases increasing to account for 9% of total sales. While retailers concentrate on in-store detectives and technology, the thieves head to where the crowds are, and online fraud now accounts for 4% of all retail fraud in the UK.

"From an organizational viewpoint, it makes sense to have loss prevention online and in-store and, whereas companies normally focus on training programmes across stores, only 10% do so for online," said Frances Riseley, Martec's Deputy Managing Director. "This may be because online is still fairly new though it is clear that loss prevention needs to be better managed and controlled."

An interesting finding from the survey of loss prevention management was that in-store and online channel teams aren't talking.

"Considering most retailers invest in multichannel platforms, it is interesting that loss prevention hasn't got there yet," said Riseley.

Tags: e-commerce, fraud, in-store security, loss prevention, multichannel, online security, retail, UK

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