Final answer:
Losses from theft by both outsiders and employees in the retail sector are commonly referred to as 'shrinkage'.
Step-by-step explanation:
Retailers sometimes refer to losses from both theft by outsiders and theft by employees as shrinkage. This term encompasses a variety of inventory losses including theft, damage, and errors in paperwork, and is a challenge for many retail businesses. While downsizing refers to reducing the number of employees or the size of a business, restitution involves the compensation for loss or damage, and pillage refers to the act of looting or stealing, usually during wartime or conflict.