Employee Theft in the retail industry, also commonly referred to as internal theft, occurs when an individual steals from the company where they are currently employed. While other types of retail theft often garner more attention, employee theft typically causes the most damage to retailers on an annual basis, carrying the greatest financial loss and a substantial impact on the business.

In most situations, retail customers only have access to merchandise on the selling floor—which is protected by the sales team, loss prevention personnel, and various anti-theft systems and controls. Employees, however, have greater access to more systems, more products and more areas of the store than customers. They have access to merchandise in the stockrooms, receiving, or shipping areas where CCTV surveillance, EAS tags and other anti-theft devices may be less effective.

Find out where the real threat to your company lies by reading this FREE Special Report, Employee Theft: Statistics, Interviewing Techniques and Tips to Optimize your Employee Theft Policy.

They may also have access to cash from customers, register drawers, or the cash office. Those with access to the POS register system may be provided with ample means for other theft and fraud issues. Employees know the store team members, learn their habits, follow their schedules, and can take additional measures to avoid detection. Simply stated, employees have a much greater opportunity to steal. As a result, employee theft can affect a business much more quickly and to a significantly greater extent than most external theft incidents.

Employee theft incidents can occur in a variety of different ways. Theft of merchandise, cash and cash equivalents, product consumption, theft of equipment and theft of services are some of the more common issues. Yet as varied as the types of theft may be, there are even more different methods of theft that can used by employees to steal from their companies; only limited by the creativity of the individual and the opportunities that are presented. There are also a variety of reasons that can lead employees to make the ill-advised decision to steal. Personal issues, financial problems, peer pressure, drug and related dependencies, and coercion are just a few.

Most employees are honest and hard-working people with honorable intentions. However, when employee theft issues occur, it can lead to significant concerns that can impact the store in many ways, reaching far beyond the financial losses caused to the company. It impacts retail sales. It impacts retail shrink. It impacts the company brand and reputation. It also impacts all of the hard working associates who give their best each and every day.

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