Ex­perts: Wal­mart out­sources its se­cu­rity costs to tax­pay­ers

Po­lice re­ported to the stores 9 times a day on av­er­age last year

The State (Sunday) - - Front Page - BY CODY DULANEY cdu­[email protected]­tate.com

Po­lice come to ar­rest the per­son ac­cused of steal­ing a $2 Chap­stick and in­ves­ti­gate the theft of $10 sun­glasses. They’re asked to set­tle do­mes­tic spats, break up park­ing lot dis­putes and re­move dis­or­derly drunks.

These calls to po­lice — thou­sands of which are made each year — chew up hours of the Columbia Po­lice De­part­ment’s time. And they all start at Wal­mart.

Four Wal­mart lo­ca­tions rely on Columbia po­lice more than any other es­tab­lish­ment in the city, ac­cord­ing to The State’s re­view of CPD crime data from 2014 to present. The big-box re­tailer gen­er­ated far more calls to po­lice com­pared to much larger shop­ping cen­ters such as Columbiana Cen­tre, which is home to more than 100 stores, and other com­pa­ra­ble re­tail­ers like Tar­get.

Last year alone, Columbia po­lice re­sponded to a Wal­mart, on av­er­age, nine times a day. That’s one call ev­ery three hours.

And tax­pay­ers are set­tling the bill.

“Wal­mart looks at se­cu­rity as an ex­pense,” said Burt Flickinger, a lead­ing re­tail con­sul­tant based in New York. “They out­source that cost to the tax­payer.”

In the past four years, the vast ma­jor­ity of Wal­mart calls, about 40 per­cent, in­volved sus­pected theft. Only 8 per­cent dealt with vi­o­lence or some kind of dis­tur­bance.

Columbia po­lice rec­og­nized the prob­lem in July and stopped re­spond­ing to mis­de­meanor sho­plift­ing calls if the sus­pect had al­ready left the store, said Maj. Dana Oree. Busi­nesses are now told to file a po­lice re­port on­line.

“Just with that sub­tle change, we’ve been able to see a dif­fer­ence,” he said.

Now, of­fi­cers are re­spond­ing to roughly 20 per­cent fewer in­ci­dents of Wal­mart sho­plift­ing, he said. But some ques­tion whether that goes far enough.

Wal­mart rep­re­sen­ta­tives rec­og­nize the prob­lem, too, say­ing the com­pany has in­vested mil­lions in peo­ple, pro­grams and tech­nol­ogy to po­lice their own

THERE ARE A FI­NITE NUM­BER OF OF­FI­CERS WHO HAVE A FI­NITE AMOUNT OF TIME TO DEAL WITH WHAT­EVER HAP­PENS TO COME UP IN ANY GIVEN SHIFT.

Seth Stoughton, as­so­ciate pro­fes­sor of law at USC and a for­mer po­lice of­fi­cer in Flor­ida

stores.

The prob­lem isn’t unique to Columbia. The sheriff’s de­part­ments of Richland and Lex­ing­ton coun­ties both said Wal­mart was the most ac­tive lo­ca­tion for deputies in the same time pe­riod. And in 2016, Time mag­a­zine re­ported that 14 per­cent of the Cam­den Po­lice De­part­ment’s in­ci­dent re­ports orig­i­nated at the Wal­mart there.

Other me­dia re­ports from around the coun­try show a sim­i­lar trend of Wal­marts us­ing a dis­pro­por­tion­ate share of po­lice re­sources.

Enor­mous store lay­outs, hap­haz­ard dis­play of mer­chan­dise and the lack of park­ing lot guardian­ship might help ex­plain the high calls for ser­vice, ac­cord­ing to po­lice and se­cu­rity con­sul­tants. There are easy fixes. Lo­cal and county gov­ern­ments could send Wal­mart a bill for its dis­pro­por­tion­ate use of po­lice ser­vices. That’s what hap­pened in Beech Grove, Ind., where the town’s mayor deemed the lo­cal Wal­mart a pub­lic nui­sance and threat­ened it with fines of up to $2,500 for ev­ery mi­nor of­fense re­ported to po­lice.

Or Wal­mart could hire off-duty po­lice of­fi­cers, like many other busi­nesses do in the city. Off­duty of­fi­cers have all the same re­sources to write po­lice re­ports, make ar­rests and trans­port peo­ple to jail — but the of­fi­cer is paid by the busi­ness in­stead of tax­pay­ers.

But there are no known plans to do ei­ther in Columbia.

“Wal­mart has been get­ting away with it for a long time and con­tin­ues to get away with it. Peo­ple have a hard enough time pay­ing their own bills. They can’t af­ford to be sub­si­diz­ing the wealth­i­est fam­ily in the coun­try,” Flickinger said of Wal­mart’s founders, which has a col­lec­tive net worth of nearly $175 bil­lion.

‘ANY­ONE AND EV­ERY­ONE’

Other big box stores don’t have the same prob­lem. Wal­mart has twice as many stores in Columbia com­pared to Tar­get, but on av­er­age, still gen­er­ated six times as many po­lice calls per store.

A sin­gle Wal­mart lo­ca­tion, 5420 For­est Drive, logged nearly as many calls to po­lice as the much larger Columbiana Cen­tre mall on Har­bi­son Boule­vard.

“There is, and has al­ways been, such a dis­par­ity in the way that Wal­mart uses po­lice re­sources com­pared to the way that other sim­i­lar es­tab­lish­ments like Tar­get might,” said Seth Stoughton, as­so­ciate pro­fes­sor of law at USC and a for­mer po­lice of­fi­cer in Flor­ida.

Stoughton, who is also a mem­ber of the Columbia Po­lice’s Civil­ian Ad­vi­sory Coun­cil, has re­viewed data on this topic be­fore.

“It’s re­ally not much of an ex­ag­ger­a­tion,” he said. “Wal­mart will sup­port the ar­rest and pros­e­cu­tion of any­one and ev­ery­one, and that’s just not the case with most busi­nesses.”

It could take an hour or more for an of­fi­cer to re­spond to a Wal­mart call, eval­u­ate the sit­u­a­tion, write a re­port and, if nec­es­sary, trans­port an of­fender to jail. That is time taken away from pa­trolling neigh­bor­hoods and keep­ing peo­ple safe, Stoughton said.

“There are a fi­nite num­ber of of­fi­cers who have a fi­nite amount of time to deal with what­ever hap­pens to come up in any given shift,” he said.

Law en­force­ment agen­cies pri­or­i­tize calls, but that doesn’t en­tirely solve the prob­lem with such a high vol­ume com­ing from Wal­mart, he added. And while busi­nesses are told to file po­lice re­ports on­line for in­ci­dents of mis­de­meanor sho­plift­ing, they can still re­quest an of­fi­cer to show up.

Stoughton wrote a pa­per on the prac­tice of hir­ing of­fi­cers out to pri­vate en­ti­ties, and he be­lieves it’s rea­son­able to ask busi­nesses that use po­lice re­sources dis­pro­por­tion­ately to hire off-duty of­fi­cers.

“I’m very com­fort­able with the idea of re­quir­ing, en­cour­ag­ing or work­ing with Wal­mart so that the bulk of their needs for po­lice ser­vices would be ful­filled by off-duty of­fi­cers, in­stead of di­vert­ing on-duty re­sources,” he said.

But it’s also a mat­ter of per­spec­tive.

“As a tax­payer, I think it’s fair. But as a tax­payer, Wal­mart might not think it’s fair.”

BEEF­ING UP SE­CU­RITY

Wal­mart is the state’s largest em­ployer, pro­vid­ing jobs to more than 32,000 South Carolini­ans. The com­pany’s mas­sive op­er­a­tions prop up an ad­di­tional 13,000 jobs for sup­pli­ers in the state. And in South Carolina last year, the com­pany paid more than $9.4 mil­lion in taxes, Wal­mart spokesman Casey Sta­heli said.

“The premise that we out­source (se­cu­rity) to law en­force­ment would im­ply that we some­how don’t con­trib­ute to the com­mu­nity,” Sta­heli said. “Like ev­ery mem­ber of the com­mu­nity, we also have a right to re­ceive com­mu­nity ser­vices.”

But in the past four years, the Columbiana Cen­tre paid close to $1 mil­lion more in taxes than the city’s four Wal­mart lo­ca­tions com­bined. Still, the mall at­tracted far fewer po­lice calls.

Hun­dreds of peo­ple en­ter Wal­mart lo­ca­tions ev­ery day, and theft con­trib­utes to the vast ma­jor­ity of po­lice calls, Sta­heli rec­og­nized. The value of items stolen can vary greatly — from a 24-yearold woman steal­ing two

shirts at $21 each in the Wal­mart on For­est Drive in 2016, to a 23-year-old man at­tempt­ing to walk out with four tele­vi­sions to­tal­ing $8,700 at the same lo­ca­tion in 2015.

Most stores have a thresh­old for what they’re will­ing to let slide, Sta­heli said. But he wouldn’t say whether the $2 tube of lip balm meets that thresh­old.

Wal­mart has taken steps to fix the prob­lem by in­vest­ing mil­lions in hir­ing and train­ing staff to po­lice the stores, he said.

They’re called “as­set pro­tec­tion as­so­ci­ates” and they are spe­cially trained to look for and pre­vent sho­plift­ing. They’re the em­ploy­ees wear­ing yel­low vests who check re­ceipts as peo­ple leave the store. Oth­ers work un­der­cover and be­hind the scenes.

How­ever, beef­ing up in-store se­cu­rity only leads to more po­lice calls, say law en­force­ment and se­cu­rity con­sul­tants. They wind up catch­ing more peo­ple try­ing to steal.

Wal­mart uses in­ter­nal store data cou­pled with crime data to de­ter­mine whether to con­tract with lo­cal po­lice for off-duty of­fi­cers, a spokes­woman said. But she would not say when the last time that hap­pened in Columbia, or if it will hap­pen again.

THAT’S WHY WAL­MART FREAKS OUT OVER STUFF THAT COSTS $2.99. THEY FEEL LIKE THEY CAN’T LET ANY­ONE GET AWAY WITH ANY­THING BE­CAUSE IT DE­STROYS THEIR BUSI­NESS. AND IF YOU LOOK AT THE NUM­BERS, IT’S TRUE. … YOU DON’T HAVE TO STEAL MUCH TO START RE­ALLY HIT­TING THE BOT­TOM LINE. Charles Fish­man, au­thor of The Wal-mart Ef­fect

‘IT DE­STROYS THEIR BUSI­NESS’

Theft is a big prob­lem for Wal­mart.

Wal­mart U.S. CEO Greg Fo­ran es­ti­mated the com­pany loses $3 bil­lion each year to loss of in­ven­tory, ac­cord­ing to re­ports from Reuters. That’s about 3 per­cent of its in­ven­tory, more than dou­ble the in­dus­try av­er­age, Bloomberg News re­ported.

Store poli­cies could ex­plain why Wal­mart ex­pe­ri­ences more crime than sim­i­lar re­tail­ers, said Michael Scott, di­rec­tor of the Cen­ter for Prob­lem-ori­ented Polic­ing.

The cav­ernous lay­out of the huge ware­houses of­ten presents op­por­tu­ni­ties for theft. Shelves tower high above peo­ple, pre­vent­ing the abil­ity to wit­ness sus­pi­cious be­hav­ior. Mer­chan­dise isn’t pro­tected or prop­erly main­tained. And many stores aren’t do­ing enough to pro­tect their park­ing lots.

“All of those prac­tices … re­ally ex­plain why you get such a high call vol­ume at Wal­mart,” Scott said.

But in re­al­ity, much of the de­ci­sion mak­ing is

based on eco­nom­ics, said Charles Fish­man, who wrote The Wal-mart

Ef­fect, a book about the com­pany’s im­pact on com­mu­ni­ties.

With Wal­mart’s “low, low prices,” the profit mar­gins are ra­zor thin — about 3 per­cent, Fish­man said. So when a per­son steals some­thing that costs $3, they’re re­ally steal­ing $100 in sales.

“That’s why Wal­mart freaks out over stuff that costs $2.99. They feel like they can’t let any­one get away with any­thing be­cause it de­stroys their busi­ness. And if you look at the num­bers, it’s true. … You don’t have to steal much to start re­ally hit­ting the bot­tom line,” Fish­man said. “But why is it the job of Columbia po­lice to worry about $2.99 in theft in­side a Wal­mart store?”

Re­tail se­cu­rity con­sul­tants say busi­nesses have to draw the line on theft some­where.

“If you al­low that to hap­pen, it be­comes rampant. It goes unchecked,” said Jeff Zis­ner, CEO of AEGIS Se­cu­rity and In­ves­ti­ga­tions, a Cal­i­for­nia-based firm that spe­cial­izes in re­tail se­cu­rity and loss pre­ven­tion.

Ma­jor cor­po­ra­tions al­ready spend mil­lions on se­cu­rity and loss pre­ven­tion, he said. But if the goal is to re­duce calls to po­lice, the best — and likely cheap­est — op­tion is to hire off-duty of­fi­cers, he said.

Columbia Mayor Steve Ben­jamin doesn’t like the idea of forc­ing that onto a pri­vate busi­ness.

“I think you’re get­ting into dan­ger­ous ter­ri­tory to start pro-rat­ing pub­lic safety,” Ben­jamin said. “We want to make sure our re­sources are go­ing to­ward the most sig­nif­i­cant pub­lic safety threats. But ob­vi­ously re­spond­ing to sho­plift­ing does not rise to that level.”

Ben­jamin ap­plauded the po­lice de­part­ment’s move to en­cour­age busi­nesses to file re­ports of mis­de­meanor sho­plift­ing on­line, say­ing that’s a good first step.

“I’m not sure there’s an easy an­swer to this,” he said, adding he is al­ways will­ing to dis­cuss ways to im­prove. “But it has to be in the in­ter­est of keep­ing peo­ple and their prop­erty safe, even if they are cor­po­rate cit­i­zens.”

Some Columbia City Coun­cil mem­bers don’t think it’s an is­sue.

Coun­cil­man Moe Bad­dourah said if the prob­lem rose to such a level where off-duty of­fi­cers were needed, Columba Po­lice Chief Skip Hol­brook would bring that to the at­ten­tion of coun­cil. Un­til then, he can’t dis­crim­i­nate be­tween busi­nesses.

Coun­cil­man Sam Davis was ap­a­thetic, say­ing it’s up to Wal­mart. And if of­fi­cers wanted to earn more money on the side, that’s fine, he said.

On the other hand, Coun­cil­man Daniel Rick­en­mann said he wants to bring the is­sue up at a city Pub­lic Safety Com­mit­tee meet­ing.

“I think it war­rants a dis­cus­sion with our po­lice chief and an out­look of some kind of plan,” he said. “That’s a tremen­dous amount of time spent (at Wal­mart). If these num­bers are ac­cu­rate, it cre­ates a sense of con­cern.”

Po­lice and se­cu­rity con­sul­tants say com­mu­ni­ties should ask them­selves two ques­tions: What level of po­lice ser­vice should a per­son or busi­ness rea­son­ably ex­pect for their taxes, and what level of se­cu­rity is rea­son­able to ex­pect some­one to cover them­selves?

Ev­ery per­son and busi­ness does a lit­tle of both. They pay the cost of keep­ing them­selves and their prop­erty safe and se­cure, and pay taxes so the po­lice have the re­sources to do what they can’t.

“Wal­mart has the abil­ity to stop the prob­lem,” Fish­man said. “They’ve de­cided they can’t af­ford to.”

TIM DO­MINICK tdo­[email protected]­tate.com

The Wal­mart on For­est Drive was the most ac­tive lo­ca­tion for Columbia po­lice from 2014 to present, gen­er­at­ing about three po­lice calls per day.

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