Agreed. On the finance side, typically each store has a shrink allowance as a % of sales. The account is adjusted following the periodic inventory audit (usuall

Agreed. On the finance side, typically each store has a shrink allowance as a % of sales. The account is adjusted following the periodic inventory audit (usually annually). It rolls up to cost of goods sold so it is reflected in the margin. So if shrink was forecast at 0.75% of sales but actually came in lower the store would see better margins on their financials.