Retail shrink hides in plain sight. Let’s look at what’s really going on.

By Fraser Neil,

Cust2Mate Chief Sales Officer

|

November 18, 2025

Turn every scan into a line of defence against shrink.

The holiday season is retail’s Super Bowl. It’s the biggest stage, and the riskiest one too.
Shelves move faster than staff can restock, carts fill to the brim, and checkout lines stretch halfway down the aisle. Between the crowds, the pressure, and the race to meet record demand, it’s also the time when theft quietly spikes and retailers lose billions.

Every December, managers juggle two impossible missions: keeping customers happy and keeping merchandise from walking out the door.
At Cust2Mate, we see this tension up close every day. The challenge isn’t just preventing loss, it’s doing it without slowing down the flow of shopping.

Theft is rising and getting bolder

Over the past few years, grocery retailers have watched theft shift from occasional incidents to a daily operational risk.
Since 2019, the average number of shoplifting events has nearly doubled, with total losses rising by roughly 90 percent.

According to the National Retail Federation (NRF), U.S. retailers lose over $100 billion annually to shrink-related incidents.

The targets aren’t only luxury goods. They’re everyday essentials that move fast and are easy to conceal:

  • Meat, seafood, and alcohol (the top three categories for supermarket theft)
  • Baby formula and OTC medications (small, high resale value)
  • Chocolate, coffee, cheese, and other premium packaged items

But the bigger shift is where the losses happen.
A growing share now comes from self-checkout and Scan & Go systems, the very tools designed to make shopping faster. Nearly 40% of all thefts within grocery stores occur at self-checkout, according to a publication from Grocery Dive. Studies by the ECR Retail Loss Group show that up to one in five self-checkout transactions includes at least one unscanned item, and up to a third of total grocery shrink now originates at checkout. Also, for every 1% of  Scan and Go sales, there was an 11 basis points rise in shrink.

Sometimes it’s deliberate, but often it’s accidental: a missed beep, a double-scan confusion, or a product that doesn’t register. Multiply that by thousands of transactions, and the math turns brutal fast.

This is exactly where Cust2Mate’s focus lies, not just detecting theft, but catching the small scanning errors and misreads, that quietly drain margins every day.

Why the holidays make it worse

From Thanksgiving through New Year’s, everything about supermarket operations changes.
Foot traffic surges, carts get fuller, and hours stretch longer. Temporary staff join the floor with limited training, while seasonal displays and bulky winter clothing create natural blind spots.

The Council on Criminal Justice reports that over 80% of retail theft occurs during the holiday period, with peak hours between 1 p.m. and 7 p.m., the same hours when teams are at their busiest.
Black Friday and the weekends leading up to Christmas remain the worst days for in-store losses.

The moment when your team is most stretched is also when shrink risk is highest.
This is where automation and real-time visibility make a measurable difference. Retailers working with Cust2Mate use smart carts that validate each scan instantly, creating a layer of protection that scales automatically when human attention can’t.

Shrink at checkout: losses hiding in plain sight

Ask most supermarket managers where shrink happens, and they’ll point to the floor.
But studies show up to one-third of grocery shrink now occurs at checkout, especially self-checkout and Scan & Go lanes.

“Fake scans”, when shoppers move an item across the scanner without registering it, account for nearly 30% of detected thefts according to AI audit studies. Many go unnoticed because they look identical to normal scanning behaviour.

The real issue isn’t just intentional theft, it’s the lack of real-time validation.
When lanes are packed and staff are multitasking, even the best-trained associates can’t catch every missed barcode.

Cust2Mate’s approach is to prevent shrink right where it happens, at the scan itself. Our AI-driven cart platform verifies every item in real time, recognizing mismatched scans or missing entries long before they turn into losses.

Fighting shrink without hurting customer experience

No one wants to turn a supermarket into Fort Knox. The goal isn’t more locks, it’s smarter visibility.

Retailers that have managed to cut shrink this year tend to follow three guiding principles:

  • Don’t just observe, engage.
    Friendly, visible staff are the most effective deterrent. Greeting customers signals presence and attention without confrontation.
  • Design for visibility.
    Clear sightlines, lighting, and smartly placed checkouts help staff see more with less.
  • Use tech that prevents, not polices.
    Many solutions rely solely on computer vision, expecting cameras to interpret every movement with perfect accuracy. But vision alone struggles with real-world complexity, think lighting shifts, crowded aisles, and line-of-sight issues.

At Cust2Mate, we believe prevention requires a combination of technologies working together: computer vision, barcode scanning, weight validation, and an AI-based decision engine that fuses these data points in real time.
It’s this multi-sensor approach that allows our system to detect intent and anomalies more reliably, without slowing the shopper down.

Closing the gap between prevention and precision

Most supermarkets already invest heavily in cameras, tags, training, and layout design.
But today’s shrink doesn’t just happen at the door or on the shelf. It happens mid-journey, in the cart, at the scan, or in the moment between distractions on a busy day.

Traditional systems react after the fact. What’s needed now is visibility that moves with the shopper, technology that sees every product, every scan, and every small mistake as it happens.

Cust2Mate’s solution is designed exactly for this: real-time, AI-powered validation that travels with every shopper, preventing losses before they ever reach checkout.

Smart carts that see what traditional systems miss

At Cust2Mate, we’ve built shrink prevention into the shopping journey itself.
Our smart carts use multi-layer protection: AI-based anomaly detection, barcode scanning, real-time weight validation, and cart cameras that record every scanned item.

Each product scan is verified for accuracy, with the system instantly flagging mis-scans, swaps, or missing items.
If something looks off, the cart gently prompts the shopper to correct it, keeping the experience frictionless while maintaining accuracy.

Meanwhile, store teams receive real-time alerts and can perform targeted rescans only when necessary, reducing false alarms and improving staff efficiency.
Every transaction is logged with item-level snapshots, creating a complete digital audit trail for investigation or training.

Put simply: Shrink is caught and corrected in real time, not after checkout.
Losses go down, customers stay happy, and staff spend less time policing and more time helping.

With Cust2Mate, retailers can fine-tune their own balance between friction and security, choosing how proactive or seamless their journey should be.

Shrink happens. The right tech just makes sure it happens less.
Retail shrink hides in plain sight. Smart carts don’t blink.

Sources

  • National Retail Federation, The Impact of Retail Theft & Violence 2024
  • National Retail Security Survey 2023
  • Council on Criminal Justice, Shoplifting Trends & Seasonal Patterns 2024
  • TransUnion, Holiday E-Commerce Fraud Report 2024
  • Appriss Retail & NRF, Holiday Returns Survey 2023
  • Food Marketing Institute, Food Retailing Industry Speaks 2024
  • CargoNet, Holiday Cargo Theft Report 2024
  • ECR, Self-Checkout in Retail: Measuring the Impact on Loss

 

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