A need for a system and method for preventing shrinkage in physical retail store environment using real-time camera feeds is fulfilled in the ongoing description by (a) configuring cameras in a retail store forming a distributed on-device-AI (DODA) model (b) sampling two-dimensional (2D) frames from cameras, (c) generating labels and location for at least one object identified using a first unsupervised deep neural network model (DNN), (d) visually classifying anatomical parts of the human body using a second unsupervised DNN, (e) enlarging and enhancing a product based on labels and location using a third unsupervised DNN, (f) generating an index of product associated with a person using a fourth unsupervised DNN by reidentifying objects from cameras, and (f) automatically classifying activity characterizing the movement of objects including a scan activity, an in-bag activity, a no scan activity, a mis-scan activity, and a theft activity to prevent shrinkage.