Grocery stores are getting socked with larger losses from shoplifting, employee theft and check fraud.

A clerk removes a anti-theft top from a liquor bottle.
The Arizona Republic via GNS

The number of thefts are generally up, as are the amounts thieves are taking, according to a recent study by the Food Marketing Institute, based in Washington.

Stores saw employee theft increase 17%, and the value of items stolen jumped 70.3% in 2002 compared with previous year.

The mounting losses are forcing supermarkets to take more aggressive stand to control costs so they maintain customers in an increasingly competitive market, said Larry Miller, president of Trax Software and Consulting, a loss-prevention company in Scottsdale, Ariz.

Some grocers are embedding sensors as thin as a hair into the packaging of T-bone steaks, filet mignon and other high-end meats, Miller said. The meat package, if not properly scanned at checkout, will set off an alarm just like tags on electronics, CDs and DVDs do at department stores.

Meats are the No. 2 targeted item for shoplifters, just behind health and beauty products, according to the FMI report.

Liquor bottles, highly sought-after items, are starting to come with black plastic caps that require a special removal device. It's reminiscent of the ink tags used at clothing stores.

"It's the same principle as tags at the (department) stores," Albertsons spokeswoman Karen Ramos said. "The only way to get the top off is to break the bottle, so the bottle is pretty useless to them. They can't resell it."

As for check fraud, stores have long turned to technology to identify whether accounts have enough cash to support checks. But now some are using biometrics, such as fingerprint or face scans, to cash checks or are starting strict check-cashing policies.

Such theft problems are far from new to retail. But losses, some blamed on a down economy and lack of ethics, are becoming more significant, experts said.

The industry lost about $31.3 billion in 2001, according to the latest National Retail Security Survey out of the University of Florida in Gainesville. That compares with $25.7 billion in 1996.

Loss prevention is getting more complex because supermarkets are selling more items to create greater appeal for shoppers, said Richard Hollinger, a professor of sociology and criminology at the University of Florida and an author of the study. Grocery stores are now selling DVDs, CDs, electronics and small appliances.

"They sell a whole bunch of stuff that is of interest to shoplifters," Hollinger said.

Loss can be curbed if retailers get serious about shrink, as the losses are known in the industry, Miller said, but the preventive approach is still not a priority at the executive level.

"Too many retailers are trying to catch their way to lower shrink. It can't be done," he said. "It must be done through smarter hiring, training and use of technology."

Employees are creating the biggest losses.

The National Supermarket Research Group's survey showed employee theft growing, making up 57% of all retail losses at grocery stores. Phoenix Ranch Market found it has to lock up certain items, such as liquor and painkillers. It also has zero tolerance for shoplifting, manager Dennis Raffaelli said.

"We prosecute," he said.

One of the newest loss-prevention techniques is a pre-employment screening test that looks at propensity for honesty.

About 25% of grocers use that technique, according to the 2003 National Supermarket Shrink Survey by the National Supermarket Research Group. FMI estimates it at 34%. That compares with 64% of stores that used video surveillance, one of the most-used technologies to thwart theft, according to FMI's survey.