Retail Crime Losses Increase in 2022, Prompting Changes in Business Operations

Retail Crime Losses Increase in 2022, Prompting Changes in Business Operations

Losses from retail crime rose in 2022, leading retailers across the United States to adapt their business practices, according to a survey conducted by the National Retail Federation (NRF). The survey, which gathered insights from 177 retail brands across various sectors, including apparel, jewelry, grocery, and department stores, revealed that total retail sales experienced a shrink of $112.1 billion in 2022, up from $93.9 billion in 2021. The average shrink rate for the fiscal year was 1.6%, an increase from 1.4% the previous year.

Theft accounted for 65% of retail shrink in 2022, with organized retail crime contributing to 36% of the losses and employee theft causing 29%. Process control failures and errors were responsible for 27% of the shrink, while the remaining 7% fell under the categories of “other” or “unknown.”

To combat the rising retail crime, many retailers reported increased spending on loss prevention measures. Approximately 46% of respondents increased the use of third-party security personnel, while 34% increased payroll to support risk management efforts. Additionally, 53% of retailers stated that they have implemented or plan to implement employee workplace violence training to address the risk of violent encounters associated with theft or crime.

The survey also highlighted concerns over in-store violence, with 88% of retailers reporting that shoplifters were more aggressive and violent compared to the previous year. NRF’s vice president for asset protection and retail operations, David Johnston, emphasized that the safety of employees and customers remains a top priority for retailers of all sizes and sectors.

In response to retail crime, social and physical disorder, or violence, 45% of retailers reduced their operating hours, 30% altered their in-store product selection, and 28% were forced to close store locations. Target recently announced plans to close nine stores, including three in the San Francisco Bay Area, due to violence and theft.

The survey identified Los Angeles as the most affected metro area by organized retail crime, followed by San Francisco, Oakland, Houston, and New York City. The specific percentage of thefts caused by organized retail crime was not provided in the survey.

In June, Attorney Gen. Rob Bonta launched an initiative to combat organized retail crime in California. Several retailers and online marketplaces, including Target, Albertsons, and Amazon, signed a pledge to enhance information sharing among law enforcement, retailers, and online platforms to aid in the prosecution of organized retail crime.

The partnership aims to address multibillion-dollar criminal enterprises that orchestrate complex schemes, rather than focusing on occasional shoplifting incidents.

 

CrimeDoor
Author: CrimeDoor

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