Retailers in U.S. sound alarm on organized theft
Retailers say shoplifting is getting more brazen in the U.S.: A California Nordstrom store was recently hit by a flash mob of more than 80 people who made off with designer goods, while more than a dozen people pilfered a Louis Vuitton location in a suburb of Chicago.
On Tuesday, the impact of shoplifting reached Wall Street, with Best Buy Co. shares plunging after the electronics retailer said widespread theft contributed to a decrease in one gauge of profitability. Last month, Walgreens said it would close five San Francisco stores after theft rates there spiked.
Organized retail crime costs retailers on average US$700,000 per US$1 billion in sales every year, according to the National Retail Federation. Another industry group, Buy Safe America, estimates that crime results in billions of dollars in lost economic activity each year.
Retailers and states say that theft is on the rise, although its prevalence is hard to measure on a national scale. California Governor Gavin Newsom said Monday that “the level of organized retail theft we are seeing is simply unacceptable” as he boosted police presence in major retail sites. The Illinois Attorney General’s Office said in September that organized retail crime “has increased dramatically over the last two years.”
Criminal-justice reforms have eased penalties for shoplifting in many cases in recent decades. Since 2000, at least 40 states have raised the thresholds for the value of stolen goods that triggers a felony charge, according to the National Association of Shoplifting Prevention, a group that seeks to raise public awareness of theft and push for solutions.
At the same time, options such as in-store pickup for online orders and proliferation of e-commerce have opened new avenues of attack, an August report from the NRF states. Platforms like Facebook Marketplace and Ebay are easy, anonymous places to resell stolen goods. Shoplifters are also utilizing store loopholes, returning stolen merchandise without receipts for credit or giftcards, the NRF said.
The most common items targeted are designer clothing and handbags, high-end liquor, laundry detergent, allergy medicine, razors and pain relievers, the NRF says.
“At the end of the day, it’s still about supply and demand,” said Tony Sheppard, director of loss prevention solutions at Thinklp, a software developer that helps companies prevent theft and manage its impact. “The demand for product online skyrocketed, and as a result, so too did the demand for stolen product.”