The mantra of loss prevention and retail for last decade has been 'leverage technology.' Stores have really done that using EAS tags and also surveillance cameras. Now there are even point-of-sale integrated camera systems with which they can do exception monitoring. These things just weren't possible in past years. Now stores can make better use of personnel and cover more space with the same amount of technological investment.

But still, theft happens -- or at least they try. You're hearing theft incidents will likely be up in 2008? Why?

One reason may be customer service. If stores have less money to spend, coverage on the floor will go down. So, a shopper will go in to a big box store and have to look for someone to wait on them. In previous years, there were plenty. The first line of defense has always been sales associates. In large stores, with a large amount of square footage and less people put on floor, that means more amateurs that might consider stealing will have the opportunity to try.

Also, internal theft may have increased. If stores are making do with fewer employees, there will be more opportunity for workers to be alone in a store. It is that kind of scenario that can lead to employee theft.

Vendor theft and fraud may also be impacted. As vendors bring merchandise into the store, a manager or staff person needs to check the merchandise in. If a store is busy, or understaffed, there will less chance for that to happen on a thorough basis. If a vendor says they have 100 units, but there are only 75, and a manager can't thoroughly check on that, there is 25 percent shrink right off the bat. So, the worry is that there won't be the level of cross-checking and auditing in place to prevent that kind of theft.