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New Tagging Technology Aims to Combat the $100 Billion Issue of Inventory Shrink

With the right tagging, retailers may be facing a lesser battle when it comes to inventory loss.

In an effort to combat “shrink,” or the loss of inventory due to issues like shoplifting, Kenco Label and Tag Co. and Primera Technology have released a new tagging system.

Kenco-LP technology combines a physically tamper-proof plastic tag with a completely unique security ID for each retail product. The serial number references information about a garment’s specs, pricing, store location and whether it is eligible for return, the companies said in a joint release.

Through a quick scan, retailers can track the location of products as they move between store locations, too.

Shrink issues cost retailers across the globe as much as $100 billion (about 1.82 percent of global sales) during 2018, according to the Sensormatic Global Shrink Index, compiled by Tyco Retail Solutions and PlanetRetail RNG.

A host of behaviors can contribute to the loss of inventory at retail. Wardrobing (when goods are purchased, worn and returned for a refund), the creation of fraudulent receipts, tag switching, cross-retail returns and of course, shoplifting by consumers or employees, can all result in lost product or unsalable goods.

Kenco Label and Tag Co. asserted that its patented tag technology is fully impervious to tampering without obvious damage to the product. A laminate sheath encases each paper tag, holding the plastic fastener in place.

The printing system for the full-color tags is manufactured by Primera Technology, which builds specialty printers for the creation of tags and labels. Software captures the data from each tag and gives retailers the ability to audit their merchandise at will, and is designed to integrate with existing POS systems.

The full Kenco-LP system is available for purchase for $1,750, which includes the printer, security tags, fasteners, cartridges and other elements needed to implement the tagging program. The technology will debut publicly at NRF Protect 2019, a retail loss prevention trade show in Anaheim, Calif., next week.