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Saturday, July 31, 2021

Retailers Report Rising Cases, Increased Losses from Organized Thefts

Organized retail crime continues to grow, with the number of dollars lost topping a key threshold for the fifth year in a row and three-quarters of retail companies that have been victims saying activity is up, according to the 16th annual ORC study released by the National Retail Federation.

“Retailers are seeing more cases and higher losses as organized crime continues to target stores, warehouses and cargo,” NRF Vice President for Research Development and Industry Analysis Mark Mathews said. “Retailers are investing millions to fight these crimes, but they need more help from law enforcement and, most of all, they need tougher laws that recognize the difference between petty shoplifting and professional crime for profit.”

The survey found 75 percent of loss prevention executives at a cross-section of large and mid-sized retail companies said ORC activity had increased in the past year, up from 68 percent last year. Losses averaged $719,548 per $1 billion in sales, a 2 percent increase from last year and the fifth year in a row the figure topped the $700,000 mark.

Close to two-thirds (61 percent) of retailers said their companies are prioritizing ORC more than they were five years ago, with 52 percent allocating more technology to reducing risks such as ORC-related thefts and 36 percent increasing loss prevention budgets.

Retailers cited relaxed law enforcement guidelines, changes in shoplifting laws and decreased penalties for shoplifting among the causes for increased ORC.

Stolen merchandise is sometimes returned for store credit, usually in the form of gift cards. Those cards can then be sold for cash, and 59 percent of retailers had found them for sale on websites, up from 51 percent last year.

To help fight return fraud, 52 percent of retailers had tightened or were planning to tighten return policies. Among other steps taken to fight ORC, 45 percent had changed or were planning to change point-of-sale policies, while 28 percent were doing the same with employee screening and 27 percent with the way they handle trespassing.

The top five cities for ORC in the past year in order were Los Angeles, Chicago, Miami, New York and San Francisco.

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