For UK supermarkets, growth is getting harder to find. The usual profit levers are losing their power. Typically, growth has been spurred through price increases, tactics to increase basket sizes, and loyalty schemes. But in tough times for both supermarket owners and consumers alike, those strategies don’t work so well. That means changing course, and the clearest route to profit may be cutting losses and helping store colleagues more.
Retail costs have risen across the board, from business rates and national insurance, to wages and energy. Regardless of many people’s impression that they’re enormously wealthy, most supermarket chains operate at razor-thin margins, with a typical £20 shopping basket creating only 29p in profits. So despite large revenues, the impact of even relatively small economic changes weighs heavily. But equally, small but scaled improvements can make a big difference.
Food inflation is down in 2026 to historically average levels of around 3%. However, this follows a three-year period of much higher inflation, peaking at 19% in 2023. Since wage growth experienced no-such bump during that period, most people simply have less money to spend on groceries. Certainly, they have no appetite for further price increases.
Less shrink = more gain
That is why shrink matters more than ever. Shrink is the gap between what a store buys and what it actually sells. It includes shoplifting, employee errors, supplier mistakes, checkout errors, damaged stock, spoilage and plain admin mistakes. The mix varies by chain and by store, but the overall direction is clear: losses are climbing. But malicious actions only account for half of the loss.
Deloitte reports a 33% increase in losses since COVID, with shoplifting noted as a major ingredient. In 2025, the ONS noted that police recorded over half a million shoplifting offences in England and Wales in the year ending March 2025, up 20% year on year and the highest since current recording practices began. Of course, the number of offences on record does not include undetected shoplifting or those which aren’t reported to, or recorded by the police. The British Retail Consortium’s crime survey for 2025 suggests the real figure was around 20 million incidents of theft, costing stores £2.2 billion.
It is hard work, working in a store today. There are many more activities happening than ever: click and collect order picking, scan and go, returns, and a wide range of reasons to shop. Colleagues need better support to spend the time on customer service and dealing with the things that matter.
Good cop; better cop
Retailers have welcomed the Crime and Policing Act 2026. The more serious treatment of assaults against shop workers is an enormously important part of this, but also significant is the removal of the perceived £200 threshold on treating shoplifting incidents as serious crimes. Better policing and protection for stores provides one part of the answer to reducing shoplifting. But prevention and guidance is better than a cure.
Adding more staff is economically challenging for a retailer in the current environment. Technology provides what has been proven in practice to be a more productive solution. Several retailers are leading the charge on this by introducing Vision AI. This technology can be employed across stores to improve visibility, and create operational intelligence, particularly around what is happening at self-checkouts and can guide the right behaviour for store staff and shoppers alike.
Seeing the unseen
It is not about staff staring at screens waiting to catch someone out. Instead, it’s about having AI-connected cameras observing the checkout and wider store, and creating interventions to ensure good behaviour in stores. The AI recognises normal behaviour such as scans and knows when something different is happening. For example, If something isn’t scanned, or is scanned incorrectly, then it nudges the shopper to try again.
Many missing and incorrect scans are innocent mistakes, experience has shown, and this procedure corrects those mistakes simply and immediately. Having a system nudge to correct an action means fewer staff interventions, no embarrassment to customers, and fewer confrontations. In cases where items are deliberately unscanned or mis-scanned, the screen at the till shows the act has been noted. For all but very determined thieves, the knowledge that their ‘mistake’ has been seen is enough to persuade them to rescan the item.
These soft nudges are powerful antidotes to antisocial behaviour, reminding people of social norms and the visibility of their infraction. This way, behaviour improves and retailers get a fairer return. If a retailer does this in every store, the returns can make a real difference to the viability of trading,
Shrink has too often been treated as just part of doing business, something for store teams to absorb rather than enabling a more controlled, safer environment.
When traditional growth levers are weakening, loss mitigation becomes a strategic priority. And the retailers that use better technology will succeed in a highly competitive market whilst looking after store colleagues and sales.
