Shrinkage ROI calculator: estimate your losses and the payback of a security system
From five pieces of information, we estimate what unknown shrinkage costs your retail estate every year, and how long it would take to pay back an intelligent video protection system. This page explains the method in full, so you can check every assumption behind the figure.
Get your estimate
Send us the five figures listed below and we return your estimate, calculated on the same basis as the model described on this page.
Site type · number of stores · average revenue per site · number of cameras to install · your current shrinkage rate. If you do not know your shrinkage rate, we work from the benchmark for your retail segment and flag it as an assumption.
What is unknown shrinkage?
Unknown shrinkage is the gap between a store’s theoretical stock and its actual stock, with no accounting explanation to justify it. It is measured as a percentage of revenue.
It covers three main origins: external theft (customers), internal theft (staff, contractors) and administrative errors (goods receipt, undeclared damage, till or labelling mistakes). Precisely because no one knows which dominates, the shrinkage is called “unknown”.
How this calculation is built
The simulator guesses nothing: it applies a simple rule to your own figures. You stay in control of the assumptions, and you can run them as many times as needed.
Your input data
Site type, number of stores, average revenue per site, number of cameras to install, and your current shrinkage rate.
Your current loss
Your shrinkage rate applied to your total revenue gives the annual loss you are carrying today, across the whole estate.
Gain and payback
A reduction assumption is applied to that loss. The resulting net annual gain is compared with the cost of the system to estimate the payback period.
The assumption, stated openly
The simulator applies a 30 % reduction in shrinkage. That is deliberately the lower bound of what we observe among our equipped customers, where results range from 30 % to 60 %. We would rather give a cautious estimate than a flattering promise: a figure you beat is worth more than a figure you miss.
What this result does not tell you
An estimate is not a quotation. Here are its limits, stated honestly, so you know what to do with it.
It ignores how your losses break down
External theft, internal theft and administrative errors call for different answers. An estate whose shrinkage comes mainly from goods receipt is not treated like one exposed to theft on the shop floor.
It assumes your sites are comparable
The calculation works from an average revenue per site. A highly mixed estate — large stores alongside convenience formats — will produce a coarser estimate.
It leaves out your indirect gains
Fewer disputes, operating time saved, insurance terms, staff safety: these effects are real but are not modelled here. The estimate is therefore conservative.
Reducing shrinkage: what actually works
A camera that records does not reduce shrinkage: it lets you understand after the fact. What reduces shrinkage is the ability to see what repeats, and to act before the loss.
Spot patterns, not incidents
- Identify the areas, time slots and aisles where losses concentrate
- Separate what comes from customer flow and what comes from operations
- Compare sites with each other to isolate what is abnormal
Shorten the reaction time
- Be alerted during the event rather than discovering it at stocktake
- Verify an alarm remotely, without sending anyone on site
- Retrieve and export a sequence in minutes when a dispute arises
Your questions about shrinkage and its calculation
What shrinkage rate should I enter if I do not know mine?
If your stocktake does not show it directly, start from the gap between theoretical and actual stock as a share of revenue. Failing that, try several values: the point of the tool is to show the order of magnitude and how sensitive the result is, not to produce a single figure.
What assumption is the stated reduction based on?
The calculation applies a 30 % reduction in shrinkage, the lower bound of what we observe among our equipped customers, where results range from 30 % to 60 %. The estimate is therefore deliberately cautious.
Does the result account for the cost of the system?
Yes. The payback period compares the estimated net annual gain with the cost of the system matching the number of cameras you entered. That comparison is what produces the return on investment shown.
Does this calculation apply to a warehouse or an industrial site?
The logic still holds, but the vocabulary of shrinkage belongs to retail. On a warehouse or an industrial site, losses are measured instead through inventory discrepancies, delivery disputes or downtime. Our teams produce the equivalent estimate for those contexts.
What happens after the simulation?
You get your results on screen. If you want the detail and a projection across your real estate, you can leave your details: an expert calls you back to build the estimate from your own stocktake data.
Is my data kept?
The values entered in the simulator are used solely to produce the calculation displayed. Your contact details reach us only if you choose to send them, and they are neither shared nor sold.
Is video protection enough to bring shrinkage down?
No. A system that merely records lets you understand after the fact, rarely prevent. What brings shrinkage down is making use of what the video produces: spotting recurring patterns, being alerted during the event, and shortening the reaction time.
Can I get an estimate for a mixed estate?
The simulator works from an average revenue per site, which suits a homogeneous estate. If your formats differ widely, the estimate remains indicative: it is better to run it per group of comparable sites, or to ask us for a detailed projection.
Move from estimate to quotation
An expert reruns the calculation with your real stocktake data and your estate configuration, with no commitment.