Retailers report record $112B in lost inventory amid theft, violence

THIS WEEK TARGET ANNOUNCED IT WOULD BE SHUTTING DOWN SELECT STORES ACROSS THE COUNTRY – CITING VIOLENCE TIED TO ONGOING ORGANIZED RETAIL THEFT.

AND IN PHILADELPHIA – MORE THAN 50 PEOPLE WERE ARRESTED AS MULTIPLE STORES WERE RANSACKED BY LOOTERS OVER TWO NIGHTS- RESULTING IN THE TEMPORARY CLOSURE OF ALL STATE-RUN LIQUOR STORES IN THE PHILLY AREA AFTER SEVERAL WERE BROKEN INTO.   

AS THESE INCIDENTS PUT A SPOTLIGHT ON ISSUES THE RETAIL INDUSTRY IS FACING – A NEW SURVEY OF 177 RETAIL BRANDS SHOWS JUST HOW MUCH THEFT IS COSTING THESE BUSINESSES.

THE ANNUAL RETAIL SECURITY SURVEY – RELEASED THIS WEEK BY THE NATIONAL RETAIL FEDERATION – SHOWS STORES SUFFERED A RECORD $112.1 BILLION IN LOSSES LAST YEAR – UP ABOUT $18 BILLION FROM A PREVIOUS HIGH OF $94 BILLION IN 2021. THE SURVEY NOTES THAT THEFTS – BOTH EXTERNAL AND INTERNAL – MAKE UP ABOUT 65 PERCENT OF WHAT RETAILERS REFER TO AS SHRINK –  OR LOST INVENTORY.

THE NRF SAYS RETAILERS ARE SEEING UNPRECEDENTED LEVELS OF THEFT AND RAMPANT CRIME IN THEIR STORES.

MORE THAN TWO THIRDS OF RESPONDENTS SAY THEY ARE SEEING HIGHER LEVELS OF VIOLENCE AND AGGRESSION FROM THIEVES THAN THE PREVIOUS YEAR

IN AUGUST – TARGET CEO BRIAN CORNELL SAID HIS COMPANY HAS SEEN A 120 – PERCENT INCREASE IN SHOPLIFTING INCIDENTS WITH VIOLENCE OR THREAT OF VIOLENCE SINCE THE BEGINNING OF THE YEAR

45 PERCENT OF THE RETAILERS SURVEYED SAID THEY HAVE REDUCED SPECIFIC STORE OPERATING HOURS TO COMBAT THE CRIME.

28 PERCENT REPORTED CLOSING SPECIFIC STORES – AS TARGET IS DOING – SHUTTING NINE LOCATIONS INCLUDING STORES IN CITIES LIKE NEW YORK, SEATTLE AND SAN FRANCISCO.  

THOUGH THEFT IS A PROBLEM MANY RETAILERS ARE FACING, A RECENT ANALYSIS BY CNBC SAYS IT MIGHT NOT ALWAYS BE THE MAIN REASON BUSINESSES ARE EXPERIENCING LOWER PROFIT MARGINS. THE NETWORK SAYS OTHER FACTORS LIKE EXCESSIVE DISCOUNTING COULD PLAY A BIGGER ROLE.