Australian retailers face rise in crime & cybersecurity woes
Retail crime and cybersecurity have emerged as significant concerns following recent developments and budget announcements in Australia.
In particular, the rise in retail crime has been a pressing issue, as John-David Klausner, General Manager, International at Loop, noted. Klausner highlighted that Australian merchants observed a 22% increase in high-risk return attempts during the recent peak shopping season. This aligns with Loop's 2024 report, indicating that 93% of global retailers view returns abuse or fraud as a significant impediment, with Australian shoppers admitting to a 40% engagement in returns fraud, which severely impacts retailers financially, causing losses of AUD $10.40 for every AUD $100 in returned merchandise.
The problem is not confined to returns alone, as shoplifting poses a similar threat. Klausner noted a 23.7% increase in store theft in New South Wales from 2021 to 2022. With New South Wales housing a significant portion of the Australian population, these numbers are worrisome for the retail sector. Fortunately, advancements in technology offer some promise in combating these issues. For instance, AI and sophisticated fraud detection tools can identify repeat offenders and prevent fraudulent activities. Major supermarkets such as Woolworths and Coles are implementing AI-powered self-checkouts and security gates, illustrating how technology can enhance security measures in retail settings.
Amidst these challenges, Klausner advocates for government investment in crime prevention technology, reinforcing the stance of retail associations who seek federal budget support. Such investments could be pivotal for Australian retailers striving to tackle theft and fraud, potentially safeguarding their businesses in these challenging economic times.
Parallel to the retail industry's security measures, the recent federal budget also draws attention to cybersecurity issues in Australia. Tony Burnside, SVP and Head of APAC at Netskope, underlined the inexorable link between privacy and cybersecurity. The federal budget, revealed shortly before an impending election, focuses on alleviating immediate economic pressures but appears to fall short in addressing cybersecurity concerns for small businesses.
Burnside highlighted a gap in government support for small businesses, which, despite their revenue under AUD $3 million, play a critical economic role and often manage substantial amounts of personal data. There are calls for these businesses to be held to higher standards under upcoming privacy regulations. However, Burnside expressed concerns over the adequacy of government funding to support these organisations in enhancing their digital and security capabilities. The budget allocates just AUD $60 million to this sector, which is perceived as insufficient to improve cybersecurity infrastructure substantially.
The voiced concerns from the retail and tech sectors illustrate a growing recognition of the need for robust security measures to protect against financial crime and data breaches. The call for increased investment indicates a collective urge from industry leaders for the government to address these issues more assertively, particularly as cyber threats continue to evolve and the retail environment becomes increasingly susceptible to sophisticated criminal activity. As the federal budget's allocation is scrutinised, the effectiveness of existing and future measures in protecting the retail sector and small businesses remains a critical issue for stakeholders across the country.
