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May 22, 2018

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Tyco Retail Solutions releases the new
2018 Sensormatic® Global Shrink Index
in partnership with PlanetRetail RNG

Global shrink rate of 1.82 percent cost retailers nearly
$100 billion in 2017, according to the findings

NEUHAUSEN, Switzerland - May 22, 2018 -
"Shrink," otherwise known as a reduction in inventory due to shoplifting, employee theft or other errors, significantly impacts a retailer's bottom line. Tyco Retail Solutions, a global leader in data-driven loss prevention, inventory intelligence and traffic insights, today released the industry's most extensive study conducted in recent years, providing insights into the sources and impacts of global retail shrink. The Sensormatic Global Shrink Index is a culmination of research that measures world-wide retailer performance, allowing them to benchmark their shrink rates to others in the same vertical and region.

Tyco commissioned global retail market intelligence provider PlanetRetail RNG to conduct the 2018 Sensormatic Global Shrink Index which included over 1,100 retail decision makers across four regions, 14 countries and 13 retail segments. Retailers surveyed operate over 229,000 stores, generated an estimated $1.56 trillion during 2017-2018 and account for 80 percent of total global retail sales. The retailers work in the world's leading economies, which account for 73 percent of global Gross Domestic Product (GDP).

The scope and coverage of the study includes how loss prevention professionals are measured and incentivized, the technologies and services being leveraged, the top stolen items and brands, and data elements being used to monitor and predict shrink.

According to the Sensormatic Global Shrink Index, shrink cost retailers nearly $100 billion globally last year. Shrinkage across retail stores in the U.S. accounted for 1.85 percent of sales, slightly above the global rate (1.82 percent). Although the country ranked ninth in terms of a percentage of sales, its position as the largest global consumer market means this translates into the highest losses based on shrinkage value at $42.49 billion of sales - almost half of the total across all country markets surveyed. Other key U.S. findings include:

● External theft/shoplifting, including organized retail crime (ORC), make up the most significant percentage of losses at 35.55 percent of lost sales, slightly above the global average, followed by loss due to internal shrinkage, including employee theft, at 24.54 percent.

● After Electronic Article Surveillance (EAS), alarm monitoring is the next most popular loss prevention investment, followed by access control systems, exception-based reporting and closed-circuit television (CCTV).

● Fashion and accessories have the highest rate of shrink by retail vertical at 2.43 percent of sales.

These statistics highlight the magnitude of shrink's impact on retail and affords the opportunity to dive deeper into the sources of shrink, particularly in the U.S., as well as the loss prevention tools to help combat loss.

"Best in class retailers are optimizing their physical stores by ensuring that operational controls are in place for growing problems such as retail shrink," said Catherine Walsh, senior vice president and general manager, Tyco Retail Solutions. "The Sensormatic Global Shrink Index benchmarks retailer performance globally and sheds light on other factors affecting loss prevention. Knowing the state of shrink helps retailers better assess the challenges and solutions to make merchandise secure yet accessible for a better customer experience."

Tyco Retail Solutions is a globally trusted leader, helping retailers discover new ways to control loss and leverage it as an opportunity to increase profitability.

To view the full report's findings, visit the 2018 Sensormatic Global Shrink Index here.

PlanetRetail RNG is a global intelligence and advisory business exclusively focused on retail. For more information, please visit https://www.planetretailrng.com/.

About Johnson Controls
Johnson Controls is a global diversified technology and multi industrial leader serving a wide range of customers in more than 150 countries. Our 120,000 employees create intelligent buildings, efficient energy solutions, integrated infrastructure and next generation transportation systems that work seamlessly together to deliver on the promise of smart cities and communities. Our commitment to sustainability dates back to our roots in 1885, with the invention of the first electric room thermostat. We are committed to helping our customers win and creating greater value for all of our stakeholders through strategic focus on our buildings and energy growth platforms. For additional information, please visit http://www.johnsoncontrols.com or follow us @johnsoncontrols on Twitter.

About Tyco Retail Solutions
Tyco Retail Solutions, part of Johnson Controls, is a leading provider of analytics-based Loss Prevention, Inventory Intelligence and Traffic Insights for the retail industry. Our solutions deliver real-time visibility and predictive analytics to help retailers maximize business outcomes and enhance the customer experience in a digitally-driven shopping world. Our more than 1.5 million data collection devices in the retail marketplace capture 40 billion shopper visits and track and protect billions of items each year. Our retail portfolio features the premier Sensormatic®, ShopperTrak® and TrueVUE brands, as well as a full suite of building technology solutions. For more information, please visit TycoRetailSolutions.com, or follow us on LinkedIn, Twitter, and our YouTube channel.

Click here to download the full report.



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