The world has always had its share of liars, cheats, and thieves. However, as reflected in this year’s 26th Annual Retail Theft Survey, retail theft – is once again – exceeding old norms. This year’s survey reports on 23 major retail companies, representing 23,204 stores, with retail sales of $669 billion (2013). The survey participants were all large retail companies (Department Stores, Mass Merchants, Big Box) who practice true loss prevention strategies, yet they still apprehended 1.18 million shoplifters and dishonest employees in 2013, and recovered more than $199 million from those apprehensions.
The results of these continuing theft losses by shoplifters and dishonest employees result in lower profits by retailers, higher prices to consumers, loss of tax dollars, and even the closing of some stores.
In this article we are going to take a closer look into the shoplifting problem. What caused the rise in shoplifter apprehensions and recovery dollars in 2013, and what companies can do to reduce their vulnerability to shoplifting.
Shoplifting Survey Stats
. Apprehensions: Survey participants apprehended 1,102,635 shoplifters in 2013, an increase of 2.5% from the prior year.. Recovery Dollars: Dollars recovered from shoplifting apprehensions totaled over $144 million in 2013, an increase of 4.5% from 2012. This was the 11th increase in shoplifting recovery dollars in the past 12 years.
. For the 17th consecutive year, dollars recovered from shoplifters where no apprehension was made (over $98 million) increased. In 2013, this increase was an amazing 22.2%.
. Case Value: The average shoplifting case value in 2013 was $130.89, which was an increase of 2.0% from 2012’s average case value.
We asked our survey participants what they thought was the cause(s) behind the continued increase in shoplifting apprehensions and recovery dollars in 2103 and they contributed the following to increased shoplifting activity:
– Continued growth and complexity of Organized Retail Crime (ORC) activity
– Lackluster economy and continued higher unemployment levels
– Carrying higher dollar product lines/items
– Less sales associates on the selling floor to prevent thefts
– More focus by Loss Prevention staff
– Overburdened Criminal Justice System
Hayes International believes the following contributes to the shoplifting problem:
. Organized Retail Crime is Increasing: Losses from Organized Retail Crime are reported to be over $30 billion annually, triple what they were just 10 years ago. These thieves work in teams often using distraction to commit their theft of items such as over-the-counter medicines; razors; baby formula; batteries; CDs & DVDs; tools; and designer clothing. It is not uncommon for retailers to tell of experiences where groups of professionals, hardcore, or international shoplifting gangs ‘hit’ their stores using ‘booster-bags’ and similar shoplifting devices. Losses routinely are reported in the thousands of dollars per incident.
. Stolen Merchandise Easier to Sell: Many thieves have found that selling their stolen items through various on-line auction sites results in quicker sales and much higher prices than the traditional selling of items on the street or at a local flee market. This easy access to a much larger audience has resulted in shoplifting becoming a highly popular way to quickly get cash.
. Reduced Sales Floor Coverage / Customer Service: Less employees on the sales floor servicing customers, creates greater opportunities for thieves to steal.
. Increase in Fraudulent Returns/Refunds: Losses from fraudulent returns/refunds are estimated at $16 billion a year. Thieves create fraudulent receipts with desktop publishing software and color printers, and then return stolen items to the store for their full retail value (vs. 50% or less when sold over the internet or on the street).
. Reduced Social Stigma & “Low Risk/Non-Offensive” Crime: While the amateur shoplifter is finding the social stigma of shoplifting to be lessening, many professional and hardcore thieves find shoplifting is both a highly profitable and low jail-risk endeavor. Shoplifters know that violent crimes can draw jail time, while the prosecution of non-violent crimes such as shoplifting is not always encouraged by law enforcement, and therefore seldom results in ‘jail time’.
Is Shoplifting a ‘victimless crime’?
Absolutely not! While no one knows the actual negative impact that shoplifting has on the economy and general public, all evidence indicates that this crime is much more serious than many believe! Based upon our retail industry data analyses and extensive research over the past two decades it appears that this crime has steadily grown to the point that we now estimate that 700,000-900,000 shoplifting incidents occur daily within the United States. Furthermore, we conservatively estimate the daily take for this group of thieves is between $36 and $48 million.
Shoplifting is a big business that is costing both the retailer and the general public plenty! Stores suffer as result of lost profits; employees lose their jobs as result of cutbacks in staff or layoffs brought about because of those lost profits; consumers are penalized by higher retail prices; and the general public pays through increased taxes incurred as result of lost sales tax revenue on merchandise that was stolen. Furthermore, shoplifting also has a violent side! Today it is not uncommon to find serious injuries or even death happening to both store personnel and customers in those instances where suspected shoplifters violently resist being apprehended.
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How can companies reduce their vulnerability to shoplifting? Listed below are a few suggestions:
. Provide good customer service: Shoplifters want and need privacy; so take it away from hem. When they respond “I’m just looking”, teach employees to say “Ok great, I’ll keep my eye on you in case you need any assistance”. Honest customers are ok with this (you are there if they need help), and this is the last thing a shoplifter wants to hear.
. Have employees walk the sales floor: Keep visible, and keep displays neat and organized (so missing items can be more easily noticed).
. Have good sight lines on the sales floor: Do not block the view of high value and highly popular items, and keep these items near employee work areas.
. Limit Items on sales floor: Limit the number of certain items (high value, highly pilferable) placed on the sales floor. This will reduce vulnerability to large losses of these items and make it easier to identify missing items.
. Use technology: Such as EAS (electronic article surveillance), merchandise alarms, CCTV, ink/dye tags, product tie-downs, and bulky packaging. Also ensure policies/ procedures regarding technology are adhered to.
. Know your merchandise: Especially highly popular items, high value items, what’s stolen most often and what’s easily stolen. Study why items are taken, evaluate their locations and packaging – then make changes. $