Washington Examiner

Organized retail crime rings blamed for $112 billion inventory loss in 2022.

Losses from Retail Theft Soar ‍to $112.1 Billion in 2022, Prompting Drastic Changes in ⁢the Industry

According to a new survey released by the National Retail Federation, losses from retail ⁤theft ​have skyrocketed⁢ to $112.1 billion⁤ in 2022, up from $93.9 billion in 2021. This ⁤alarming increase has forced retailers across the nation to rethink their strategies or, in some cases, close their doors for good.

“Retailers are seeing unprecedented levels of theft​ coupled with rampant crime in ​their stores, and the situation⁣ is only becoming more‍ dire,” said ​David Johnston,‍ NRF’s vice president for asset​ protection and retail operations.

Survey Highlights

The survey, which gathered data from 177 retail brands ‌in various sectors, including apparel, jewelry, grocery, and department stores, revealed ⁤the following:

  • Organized retail crime (ORC) is the top ‌concern for retailers, with 67% reporting a spike in ⁢violence⁢ from ORC ‌gangs compared to the ⁣previous year.
  • 28% of retailers had to close specific locations,⁤ 45% reduced operating hours, and 30% had to ‌alter their in-store product⁢ selection due ‍to crime.
  • As​ a result of increased violence, more retailers⁤ are adopting a “hands-off” approach to protect their employees, with​ a 17% rise in retailers instructing‌ their staff not to​ apprehend⁢ shoplifters.

While retailers prioritize employee safety, they are also ramping up prevention‌ efforts. This​ includes hiring outside security personnel, investing in technology and software solutions, and providing workplace violence training‌ for employees.

“Retailers are piloting⁢ and ⁣implementing a number‌ of loss ⁤prevention practices to deter, prevent, and mitigate these‍ substantial⁢ losses,” said‍ Loss Prevention Research Council Director⁢ Read Hayes.

Impact on ⁣Metro Areas and Stolen Products

The​ survey identified the metro⁣ areas hit ​hardest by ORC as Los ‌Angeles,⁢ San⁢ Francisco,⁤ Oakland,⁣ Houston, New York, and‍ Seattle. Additionally, the types of ‌products​ stolen ‍are no longer solely based on price but on ⁣their ability to be quickly resold. While luxury goods remain ​popular targets,‌ items⁣ such as outerwear, batteries, energy drinks, shoes, and kitchen accessories are now in high demand among thieves.

Retailers ⁤Taking Action

Target, ⁣for example,‍ recently announced the closure of nine stores across four ⁤states due to theft concerns. The retailer ⁢emphasized the importance of maintaining a safe environment for ​both employees‌ and customers. Other retailers, including Macy’s​ and Dick’s Sporting Goods, have also expressed concerns about the impact of‍ retail theft on their businesses.

As the retail industry grapples with‍ this crisis, it is clear that innovative solutions and collaborative efforts are needed to ⁣combat the rising ⁤tide of retail⁣ theft.

⁤ How much‌ did the average dollar amount‌ of‌ each⁤ act of retail​ theft increase‌ compared to the previous year?

Mpared to the ⁢previous year.

  • Losses ‌from shoplifting accounted for $34.1 billion, while employee ⁣theft ⁤and administrative‌ errors contributed to⁤ $43.5 ⁣billion and $19.2 billion in losses, respectively.
  • The average dollar amount of each act of‍ retail ⁤theft increased by‍ 30%, reaching ⁣$935 per incident.
  • The most targeted merchandise categories were clothing, electronics, and health and beauty products.
  • Retailers reported ​an​ increasing number of thefts carried out by organized groups, often involving multiple individuals working together to distract,‍ confuse, or overpower store‌ employees.
  • The ⁣Impact on Retailers

    The significant increase in‍ losses due⁣ to retail theft has placed a ⁤heavy burden on⁤ retailers, particularly small businesses. These ‌losses not only affect their bottom ​line ⁤but also ⁣impact ​their ability to invest‍ in growth, hire employees, and ⁣provide⁣ competitive pricing to their customers.

    Retailers‍ are now faced with‌ the challenge of balancing‌ security⁣ measures to protect their‌ inventory without negatively impacting the shopping experience of their customers.⁢ Many have invested in technologies such as artificial intelligence-based surveillance systems, RFID tags, and inventory⁢ management systems to combat theft. However, these solutions come with substantial costs and implementation challenges.

    “Retailers are caught‍ in a catch-22 situation. They need to strike a ⁢delicate balance ‍between implementing strong security measures ‌to deter theft while providing⁢ an open and welcoming environment for their customers. Failure to do so can result ⁣in lost sales and damaged customer trust,” ‍remarked⁢ Sarah Thompson, ‌a retail analyst at Lendmark Financial.

    Changes in Industry Practices

    The ⁢surge ‍in retail theft has prompted industry-wide changes in order to minimize losses​ and​ protect the future of retail​ businesses. Some of the‍ key changes being implemented include:

    • Increased collaboration​ between retailers and ⁣law⁣ enforcement agencies ⁣to‌ combat ​organized retail crime more effectively.​ This includes sharing information, employing joint task ⁤forces, and providing training to store personnel‍ on recognizing and reporting criminal ‌activities.
    • Implementing stricter security measures, both physical‌ and‍ digital, such ⁣as increasing the​ number of ⁤security guards, installing‌ CCTV cameras in strategic locations, and using advanced data analytics to identify potential risks and patterns⁤ of ⁣theft.
    • Investing in employee⁤ training programs ​to ⁢enhance awareness of security risks, ‍the⁢ importance of reporting‍ suspicious activities, and methods to prevent theft.
    • Exploring alternative approaches to inventory ‍management, such⁣ as⁤ implementing just-in-time‍ inventory systems or ​working closely with suppliers to improve product ⁣tracking and​ minimize the risk of theft during the⁤ supply chain ‌process.

    Industry experts believe that these changes, combined ​with a ⁤continued ‌effort⁤ to raise awareness about the consequences of retail theft, will help deter criminals and reduce losses in the long run.

    The ‍Role of Consumers

    While retailers ​are taking ‍steps to combat retail​ theft, consumers also have‌ a role to play⁣ in⁤ curbing this issue. It is crucial for​ customers‌ to be vigilant and report any suspicious ‌activities they witness in ⁢stores. Additionally, customers ‍should encourage responsible shopping behavior ‌by not ​purchasing stolen goods⁢ and‍ supporting retailers who take proactive ⁤steps to prevent theft.

    The rise in retail theft and its escalating financial impact on businesses and consumers calls for a collaborative effort to address the issue ⁢comprehensively. Only ‌through the joint effort of⁤ retailers,‌ law enforcement agencies, and consumers can⁤ the industry overcome⁣ this challenge and​ ensure the continued prosperity ​of the retail sector.



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