Shrinkage may result from stealing or because employees are not doing their jobs as they should.

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Shrinkage is the loss of inventory that can occur due to theft by customers or employees, as well as errors in record-keeping, damage or spoilage of products, or other factors. This loss can have a significant impact on a business's profitability, and it is important for managers to take steps to identify and reduce shrinkage wherever possible. Shrinkage can result from both stealing by external parties or internal employees, but it can also occur due to other factors such as administrative errors or inadequate systems and processes.

Shrinkage May Result from Stealing or Because Employees Are Not