M&S chairman blames self-service checkouts for rise in shoplifting

The market implication is less about shrink itself and more about the operating model trade-off: retailers have been optimizing labor away, but the hidden cost now shows up as more friction, more abandonment, and more security expense. That creates a second-order margin squeeze for value grocers/general merchandisers that leaned hardest into self-checkout density, because the benefit from labor savings can be partially offset by higher fraud, higher basket-time, and lower customer throughput at peak hours.

The beneficiaries are likely to be the loss-prevention stack and any vendor that can reduce false scans without adding labor. Expect renewed interest in AI-assisted vision, gated exits, receipt verification, electronic article surveillance, and store-level analytics. The winners are not the pure software names alone; it is the integrated security providers that can sell an ROI case framed around shrink reduction plus fewer staff interventions.

This also has a regulatory angle: if crime perceptions keep rising, retailers may be forced into more visible security measures, which can improve the near-term containment of losses but hurt the shopping experience and traffic conversion. Over 3-6 months, the catalyst is not just crime statistics but earnings commentary on shrink, labor, and checkout conversion; any company that quantifies a measurable drop in shrink after adding controls should rerate relative to peers.

The contrarian view is that the self-checkout thesis may be misdiagnosed as a technology failure when it is really an execution and design problem. If retailers tighten prompts, improve scan reliability, and add targeted intervention, they may preserve labor savings without a full rollback. That means the downside for the broader checkout-tech complex is probably overstated, but the upside shifts toward vendors that make self-checkout more secure rather than more convenient.