I have a friend who has a part-time job in a retail establishment. She recently shared that, per company policy, if she sees someone shoplifting, she is not supposed to say anything to the person or yell for a manager.
Front-of-the store personnel who might see a customer walking out without paying for something are not supposed to follow the wrongdoers out the door.
This is apparently for the safety of the employees. Who knows what a person who would steal in broad daylight might be packing under a jacket or sweatshirt?
This does not mean store security and law enforcement are not all over this, trying their best to keep theft losses as low as possible. But the store is not going to put their customer-facing employees at risk.
Theft definitely affects bottom line. In the retail business it is called "shrinkage."
Theft, however, is not exclusive to retail. Anyone with a credit or debit card has likely had their card compromised, meaning a bad actor has either stolen your card or has somehow obtained your card number, and made purchases.
Because of banking regulations, your card issuer is almost always responsible for reimbursing those losses. But it's a big hassle going through the claims process. And like the shrinkage that affects stores, these fraud losses have a huge impact on banks' profits.
Having a card or card number stolen has caused some bank customers to stop using them. For them, however, the alternative is to carry cash which, obviously, can't be replaced if lost; or to write checks, which some establishments will no longer even accept. I have not written a check in a grocery store in years, and that used to be the norm for me.
If you go to a big sporting event or an arena concert, it is likely the concession stands will only accept plastic --a debit or credit card.
On the other hand, some smaller merchants have stopped taking plastic because of the charges they have to pay to the issuers and card networks. At my local farmers market, most of the vendors will accept plastic, but they will give you a discount if you pay cash.
What's a shrewd consumer to do? For me, I still use a debit card for everyday purchases, and assume the risk of compromise. It has happened to me a couple of times and it has been a hassle to deal with, but I was reimbursed.
I also have a credit card, but I mostly use it for larger purchases. I know a lot of people who use their credit card almost exclusively and pay off the balance each month. If the card is lost or stolen and there is an unauthorized purchase, the claims process is similar to that of a debit card, but because it is a credit account and your card is not tied to your checking account, you don't put your operating funds at risk.
And I still carry a small amount of cash, which I use at places like the farmers market that either do not take cash or charge extra for using plastic.
Most important, I try to keep my eye on all of it to prevent fraud and theft. But it's not easy.
