5 ms·

Casual reminder shoplifting figures report the msrp value of goods stolen, not the cost to the company itself. Discount the figure by about 300%.

yardstick 3y ago
That’s fair though, isn’t it? That reflects the lost income potential from the shoplifting. Not just how much money it took to physically build an individual unit (and package and ship and stock it etc). Now if they never sell at MSRP, then probably a slight discount from MSRP when reporting is fair. But definitely not just the BOM cost or similar…
- Cpoll 3y ago
  Isn't the income potential only lost if it causes a loss of a sale (either because it runs out of stock, or if the shoplifter would have otherwise bought it)?
  - deleted 3y ago
    [deleted]
- grubbs 3y ago
  Is it though? When I share a song on a public BitTorrent tracker and get caught. Should each infringement be worth six figures?
  - yardstick 3y ago
    This is about stealing something physical, not bittorenting a song. Eg an Apple laptop has a cost to build (cost being money, materials, time). If Apple sold that laptop at $2k, I don’t think they would value the loss at six figures. Given how little Apple discounts things, they probably value the loss (fairly) around the MSRP or ~10% or that.
- HillRat 3y ago
  Nope, because shrinkage is an expense against inventory in the accounting books; fundamentally, it's a "tax" on your COGS to get to your revenue. Overreporting losses is just a bit of financial kabuki to shift underperformance over to something other than executive leadership.
  - yardstick 3y ago
    I wouldn’t consider how the accounting system treats this as relevant to what the real opportunity cost is. The accounting approach is driven by taxation, and governments strong preference for maximising their tax take.
hex4def6 3y ago
There is no way that is correct as any sort of generally true statement. A random google shows that it's highly sector dependent, but it's probably closer to 20%. Having worked in consumer electronics, and knowing rough BOM cost of products that we made in the millions, I can say (at least for the companies I worked for), that there wasn't anywhere close to a 300% multiplier, even going from BOM cost to MSRP. Even extreme outliers like Apple (who supposedly have a raw BOM cost of $475 on an MSRP of $1099 for the 14 Pro Max) don't get to 300%. That markup goes directly to Apple; As a retailer, you might be making 10%.

yardstick 3y ago

That’s fair though, isn’t it? That reflects the lost income potential from the shoplifting. Not just how much money it took to physically build an individual unit (and package and ship and stock it etc). Now if they never sell at MSRP, then probably a slight discount from MSRP when reporting is fair. But definitely not just the BOM cost or similar…

Cpoll 3y ago
Isn't the income potential only lost if it causes a loss of a sale (either because it runs out of stock, or if the shoplifter would have otherwise bought it)?
- deleted 3y ago
  [deleted]
grubbs 3y ago
Is it though? When I share a song on a public BitTorrent tracker and get caught. Should each infringement be worth six figures?
- yardstick 3y ago
  This is about stealing something physical, not bittorenting a song. Eg an Apple laptop has a cost to build (cost being money, materials, time). If Apple sold that laptop at $2k, I don’t think they would value the loss at six figures. Given how little Apple discounts things, they probably value the loss (fairly) around the MSRP or ~10% or that.
HillRat 3y ago
Nope, because shrinkage is an expense against inventory in the accounting books; fundamentally, it's a "tax" on your COGS to get to your revenue. Overreporting losses is just a bit of financial kabuki to shift underperformance over to something other than executive leadership.
- yardstick 3y ago
  I wouldn’t consider how the accounting system treats this as relevant to what the real opportunity cost is. The accounting approach is driven by taxation, and governments strong preference for maximising their tax take.

hex4def6 3y ago

There is no way that is correct as any sort of generally true statement. A random google shows that it's highly sector dependent, but it's probably closer to 20%. Having worked in consumer electronics, and knowing rough BOM cost of products that we made in the millions, I can say (at least for the companies I worked for), that there wasn't anywhere close to a 300% multiplier, even going from BOM cost to MSRP. Even extreme outliers like Apple (who supposedly have a raw BOM cost of $475 on an MSRP of $1099 for the 14 Pro Max) don't get to 300%. That markup goes directly to Apple; As a retailer, you might be making 10%.