I agree that there are a number of sources of possible error, from the retailer to the reporter that is summarizing from a much larger report. That said, the c

I agree that there are a number of sources of possible error, from the retailer to the reporter that is summarizing from a much larger report. That said, the computation of 'shrinkage' has been defined as MSRP of products that are stolen and/or damaged, divided by the gross sales of all products. The number captures "lost" revenue. My nephew, who is working at a large nationwide retailer and has access to all of this data for their stores, has told me in the past (and I presume it is still true), that the largest component of "loss" experienced on the retail side is through employee theft, either directly, or by assisting a partner to evade the payment systems. The smallest portion of this loss is from people who come into the store and take merchandise without paying for it. The "interesting" thing about that story, is not that it makes it harder to sneak out a tool, but that it requires a register transaction for that tool to work. Combined with inventory management of that tool, internal theft rings are uncovered because the employee facilitating the theft has to use their register to do so. But the stores won't tell you that of course. Just like back in the day getting out of a Fry's Electronics was like being released from a SuperMAX prison lockup with all the gates and checks and re-checks. They too were much more worried about employee theft than individuals stealing stuff.