re: What is best control of shrinkage?

Seems you already have plenty of funny answers...

Shrinkage is the difference of your "book" inventory vs your "physical" inventory

Book inventory is like a ledger that has a running total of the value of your inventory, so a simple formula would be +purchases-sales-markdowns-returns, etc=Book inventory.

You would physically add up your inventory to see what the real value is, and then compare it to the book inventory to see what the inventory shrinkage is. Most companies do it monthly,quarterly or yearly.

Shrinkage is considered a loss, and most businesses do whatever they can to control and lower it, and often give managers bonuses and awards if the shrinkage loss is kept low.

Common causes of high shrinkage are : Employee Theft, Customer Theft, Vendor errors/theft, Paperwork processing when receiving/paying invoices, and not recording inventory changes/prices accurately.