The trend: The pandemic-era rise in retail shrink appears to be easing. Over the past several weeks, several retail executives have said they’ve seen gross margin gains as theft-related losses have subsided, per Retail Dive.

Target and TJX said their shrink rates have returned to pre-pandemic levels. Target noted that lower inventory shrink added about 90 basis points to margins, while TJX reported a 20 basis point benefit.

TJX attributed the gains to its associates, who “worked hard all year long to drive this improvement,” said CFO John Klinger, adding that it reflects “our culture of quickly addressing issues and maintaining a strong focus on fixing them.”

Dollar General pointed to an 80 basis point reduction in shrink as a key driver of its 107 basis point gross margin expansion. The retailer still sees room for improvement through better in-store execution and reduced store manager turnover.

Implications for retailers: The true scope of retail theft over the past few years is still up for debate. Some executives pointed to elevated shrink, while an NRF statistic was later retracted after being overstated, and surveys of loss prevention leaders suggested levels were largely flat.

Still, the direction is clearly improving. Multiple retailers are now reporting improvement, which is welcome relief as margins remain under pressure.

Just as importantly, the drivers of a better in-store experience—well-trained, engaged associates—also mitigate theft, highlighting how strong execution can improve both sales and shrink.

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