Crimes against small business in Australia: a preliminary analysis

Abstract

In 1999 the Australian Institute of Criminology and the Council of Small Business Organisations of Australia (COSBOA) planned a nation-wide survey. This survey, the largest ever of crime against small business, analysed responses from 4,315 small businesses in the retail food, retail liquor, newsagent, pharmacy and service station sectors. This paper reports preliminary results of and revictimisation. Of the Australia-wide sample, 51.5 per cent experienced crime victimisation. In order, the highest prevalence was of theft from premises, followed by burglary, vandalism, credit card fraud and employee theft. Respondents who had been victimised reported a mean (average) of 38 incidents (this includes multiple shoplifting incidents) while the median was four incidents (half the businesses experienced more than four and half less than four incidents). Many small businesses experienced repeat victimisation mostly for credit card fraud, vandalism, assault/ threat/intimidation, employee theft and burglary. Businesses were most vulnerable in the first four years of operation and medium sized businesses were victimised more than very small businesses. The mean loss was $7,818 per victim, while the median was $1,500. Four per cent of victims were forced to close for half a day or more following a crime. This represents a significant loss to our wellbeing. This is the first release of data from this pioneering study. The Australian Institute of Criminology will release further data as it is analysed. Adam Graycar Director Crime and its prevention are enduring public issues. This survey of crimes against small business complements ABS surveys which focus largely on harms perpetrated against individuals and their households. This survey aims to fill the gap in our knowledge regarding the character, magnitude and impact of offences perpetrated within and against the business community. Existing research, both domestic and international, alerts us to the greater risk of criminal faced by commercial premises vis-avis their residential counterparts (Bamfield 1994; Walker 1994; Mirrlees-Black & Ross 1995; Federal Bureau of Investigation 1996), especially small business enterprises (British Chamber of Commerce 1997; Gill 1998). Also highlighted is the significant (and largely nonquantifiable) economic and emotional weight borne by the business community as a result of crime. Smaller enterprises are particularly vulnerable, since they lack a competitive market edge and hence experience greater difficulty in absorbing the direct and indirect costs of (Fisher & Looye 2000). These findings are especially remarkable given that in Australia small to medium businesses comprise 99.6 per cent of the entire non-government commercial sector (ABS 1999a). As acknowledged by the ABS (1999b), a business sector's contributions to employment growth and employment generation are important measures of its economic importance. Longitudinal analysis consistently reveals the small business sector to be the strongest overall contributor to national employment growth (ABS 1999a, 1999b). It is therefore clear that the adverse impact of business is not merely confined to the front line, that is, the immediate target. Its effects are widespread and cumulative, impacting not only upon the victims' immediate and extended support network, but the general business sector (through elevated insurance premiums and security costs, reduced demand for, and provision of, goods and services, and slumps in confidence accompanying economic downturn) and the wider community (through reductions in gross domestic product and employment and investment). From a purely economic perspective, the impetus to prevent crimes against business generally, and small business in particular, is therefore great. The Present Study: Research Objective and Methodology Due to the lack of systematic empirical information on crime against business, the Australian Institute of Criminology initiated and undertook the first national survey of Australian businesses' experience of crime (Walker 1994). …