Shoplifting has always been a problem for retailers. However, the emergence of coordinated and organized robberies at high-value stores, even during business hours, has put the industry on edge.
In November, a group of 14 people barged into a Louis Vuitton store in Oakbrook, Illinois, while customers were inside and drove away with $100,000 in merchandise. The entire incident was captured on surveillance video at the store.
The same month, a group of at least 18 people used a sledgehammer and an electric bicycle to break into a closed Nordstrom store at LA’s famous high-end The Grove shopping mall. They stole several thousand dollars in merchandise. In Minneapolis, as many as 30 people robbed a Best Buy on Black Friday, one of the busiest shopping days of the year.
Typically, groups of people target stores that sell higher-value items such as electronics, designer handbags, and designer clothing, and then resell the merchandise on secondary marketplaces such as eBay, OfferUp, and Facebook Marketplace, or even back into the legitimate supply chain.
“These are individuals who make a living by stealing and reselling. This isn’t a one-time opportunistic or need-driven robbery “Cory Lowe, a retail crime expert and research scientist at the Loss Prevention Research Council, an industry coalition that studies retail crime, its impact, and solutions to combat it, agreed. Retailers are concerned about the rise in organized group-led “smash-and-grab” robberies in multiple cities across the country, according to Lowe.
As retailers increase security measures to keep employees and customers safe, they must also deal with another consequence of organized theft: the high cost to retailers.
According to a report, power tools are so popular with professional shoplifters at Home Depot that the home improvement retailer last year launched a line of power tools that won’t work unless they’re scanned and activated at the checkout register.
According to Home Depot, the additional security measure is intended to deter the illegal resale of power tools. According to the National Retail Federation, some of the most popular items targeted by professional gangs of shoplifters are designer clothing, laundry detergent, designer handbags, allergy medicine, razors, high-end liquor, pain relievers, baby formula, laptops, deodorant, and high-end appliances.
Best Buy CEO Corie Barry stated in November that the retailer has seen an increase in theft by gangs of thieves at its stores. According to her, some of these incidents have involved weapons such as a gun or a crowbar.
She stated that Best Buy was putting in place a number of measures to reduce theft and protect employees and customers. These include locking up more products and, when necessary, hiring security.
Across the country, drugstore chains have closed stores in areas where shoplifting is prevalent. Walgreens, for example, has closed a few stores in San Francisco due to rampant shoplifting.
Then there’s the broader community impact to consider. Shopping generates sales tax, which is then used to fund essential public services such as school budgets, medical facilities, and local police and fire departments.
Despite the fact that organized shoplifting sprees were on the rise prior to the pandemic, Lowe claims that post-Covid lifestyle changes have made it easier for offenders to get away with the crime.
A number of other factors have also contributed to the recent increase in dangerous retail robberies. These include decreased in-store staffing, which results in less surveillance, and the ease with which thieves profit from a lack of regulation on reselling stolen items online.
According to the National Retail Federation’s 2021 National Retail Security Survey, more than two-thirds of 55 retailers polled said the pandemic increased the overall risk of fraud and crime for their businesses. According to the report, 57 percent of retailers polled reported an increase in organized retail crime during the pandemic.
In 2020, 50 percent of retailers polled reported an average dollar value loss of merchandise of at least $1,000, up from 29 percent in 2019. According to the NRF, organized retail crime costs retailers an average of $700,000 per $1 billion in sales.