What term is used to describe the loss of inventory experienced by retailers?

The term "shrink" is used to describe the loss of inventory experienced by retailers. This loss can occur due to several factors, including theft (often referred to as shoplifting), administrative errors, damage to products, or even vendor fraud.

By identifying and managing shrink, retailers can improve their profitability and efficiency, as losses in inventory directly affect the bottom line. Understanding shrink is crucial for crime prevention strategies, inventory management, and overall operational effectiveness.

In contrast, other terms like overstock refer to excess inventory that exceeds demand, inventory turnover is a metric that shows how often inventory is sold and replaced, and stockout indicates when a retailer runs out of a particular item, all of which describe different inventory challenges rather than losses.