The Negative Impact Of Crime On Business

Updated on 18 November 2022

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impacts of crime on business

Crime can have devastating effects on businesses. The majority of businesses and their staff in South Africa have been directly affected by crime. Crime is also on the rise, so it’s something that all business owners need to be carefully aware of.

There are various types of crime that can affect businesses. These different areas of crime can also be done at varying scales. While some crimes are considerably worse than others, the bottom line is that any incident of crime has a harmful effect on any business. This includes both direct and indirect effects.
In this guide, we’ll cover some of the main ways that businesses are impacted by crime. We include an overview of the three main types of crime that businesses face.

The Impact Of Crime On Business

Crime can wreak havoc on small business owners. Every incident of crime, whether it’s stolen merchandise or stolen cash, will directly impact a business bottom line. In a country where crime statistics are so high, small business owners need to be incredibly careful about how they monitor and control the different types of crime that exist.

Not only does crime add a direct cost to the business through the loss of merchandise or money, but it also adds indirect costs. This can include costs like security expenses, repairs needed after a burglary, insurance costs, temporary business closure, and a loss of work hours.
As businesses grow, so does the risk of crime which could impact these businesses. This can make many business owners cautious of growing too fast. Many small business owners who have experienced crime are unwilling to invest too much into business growth or expansion.

This is because these business owners often feel a greater need to invest in security measures rather than protect their existing business assets and operations.
While crime can be experienced by all businesses, its most common in “high-crime” areas, such as informal settlements, busy main streets and city centres. Small businesses that face multiple incidents of crime are often forced to either close or relocate their business as a result.

Crime can also affect a business customers. If crime is rife in the area, and the business has been the victim of burglaries in the past, the business might lose customers as a result.

Three Types Of Crime Impacting Businesses

There are three main ways that crime can affect businesses. Each one will require its own unique monitoring and prevention methods.

Crime By Employees

Many businesses face internal cruise issues, where employees commit theft from the business. This could include issues like undercharging customers and pocketing the difference in cash, or employees leaving their shifts with the business’s products. It’s important that businesses have very strict systems in place to monitor inventory and cash flow. This can help to detect employee theft situations. Being very careful during the hiring and screening process is also necessary for reducing the risk of employee theft.

Crime By Outsiders

Shoplifting and burglary are one of the most common concerns for small business owners. Any theft in merchandise is a major issue for a business – whether it’s a simple shoplifting or a large- scale warehouse burglary. Business owners need to employ adequate security measures to avoid these kinds of theft issues. This includes measures like alarm systems, cameras, security gates, mirrors, good lighting, and strong locks.


As businesses are placing more of their operations online, the risk of cybercrime increases. Hackers could steal valuable information from your business, like your credit information or customer list. Viruses and malware are used to target businesses IT systems and initiate cyberattacks.

It’s essential to have strong antivirus software and to keep your software up-to-date in order to avoid these types of crimes. Businesses should also focus on using cloud-based software solutions, and closely monitor employees who have access to sensitive business information.

As a business owner in South Africa, you can’t avoid the possibility of crime. However, you can take proactive measures to protect your business from crime, or reduce the impact that crimes could have on your business. Being aware of crime is essential for planning and managing a safer, more sustainable business.

Every cost that a business experiences matters, so even the smallest shoplifting incidents can add up to create major issues. Being proactive about crime prevention is important for improving the chances of your business’s long-term success.

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