[MattGrommes]

I believe shrinkage is most commonly used by retailers to mean theft by employees. Shoplifting is customer theft.

[sparky]

Shrinkage encompasses all of the above [1]. The retailer I worked at for a few years (::shudder::) used this definition.

[1] http://en.wikipedia.org/wiki/Shrinkage_(accounting)

[juiceandjuice]

Shrinkage is any loss of product, hence shrinkage of inventory.

(I worked at a grocery store for four years, the same company my dad has worked at since 1977)