By Dr. Suzanne Minarcine
Faculty Member, Dr. Wallace E. Boston School of Business
Anyone who works in retail will readily admit that shoplifting is a growing problem. Retail store managers are becoming increasingly frustrated by thieves’ audacity and a lack of response from law enforcement.
The perception by many employees is that store management is ignoring the problem, as large quantities of merchandise leave their stores each day while no one does anything. Employees are forced stand idly by while thieves fill their shopping baskets and walk out the front door of the store due to non-confrontation policies. In many stores, it is no longer necessary for thieves to even attempt to conceal their actions.
Group Shoplifting Is an Increasingly Serious Problem for Stores and Communities
Group shoplifting is affecting large and small retailers. Networks of well-organized criminals have been documented walking into stores and taking whatever items they want from pallets of televisions to fine jewelry. These organized shoplifting rings operate in major cities and often target higher-end stores with merchandise the thieves can pawn or sell out of the trunks of their cars.
Similarly, “divide and conquer” groups come into smaller stores. One group distracts the store’s salespeople while the other group walks out with expensive goods.
Ben Dugan of CVS Health testified before the U.S. Senate. He stated that shoplifting is resulting in losses of over $200 million per year, but cumulative losses across the U.S. are expected to exceed $45 billion in 2021. No store is immune, and the stores pass on their losses to consumers in terms of higher prices.
Also, employees pay the price for shoplifting. Decreased profits mean there is less money available to return to employees in the form of salary increases, bonuses and benefits.
In addition, communities suffer when stores close. Walgreen’s closed five of its 53 locations in San Francisco because of these shoplifting problems.
Some of these group shoplifting thefts have been highly publicized, such as when 80 thieves pulled off a smash and grab at a Nordstrom in California. One shoplifter at a Walmart was recently awarded $2.1 million in a lawsuit against the retail giant, after she accused the retail giant of falsely targeting her and damaging her reputation.
Some shoplifters believe it is their right to steal from large corporations. They believe that corporations are not paying people livable wages, while CEOs are receiving fat paychecks and bonuses.
Stolen Goods Are Often ‘Boosted’ for Others or Resold for Profit
“Boosting” is shoplifting for hire and is done by teens and adults. With this type of shoplifting, individuals or small groups go into stores with “shopping lists” from people who do not want to pay the full price for goods.
Other people will steal goods and resell them on eBay or Amazon. However, Amazon has announced that it is cracking down on the sale of these illegally obtained goods.
Employees Can’t Stop Group Shoplifters Due to Store Policies
Retail employees who intervene in shoplifting face attacks from shoplifters and disciplinary action from their employers. Some stores do not allow security guards to intervene, even when they see people blatantly stealing.
Employees, including security guards, are no longer stopping shoplifters but rather supervising it. “Be a good witness” is what one national chain has told its employees. Most stores have “no touch” policies where employees cannot touch the shoplifter or intervene to keep the thief from exiting the store, and most stores also prohibit employees from pursuing the shoplifters after they exit the store.
Retail Stores Are Taking Stronger Security Measures to Avoid Group Shoplifting
Some stores have installed high-tech solutions, using video surveillance and facial recognition software to monitor what is going on in their stores. Parking lot cameras monitor the suspect leaving the store and identify the make and model of the vehicle.
Plainclothes security personnel are used in some locations, though a high-end store in an Atlanta mall has hired off-duty police officers to patrol the store, some using dogs trained to detect guns. In this same mall, luxury boutiques have limited the number of people who can come into their stores, so that customers can be closely monitored by employees. In addition, security guards are posted at the doors. Customers can no longer come into these stores and browse these stores at their leisure.
Costco Has a Lower Shrinkage Rate than Other Retail Businesses
Costco has one of the lowest shrinkage rates in the retail industry. The low shrinkage rate is in part due to their restricted store access, higher salaries and higher employee satisfaction levels that reduce inside theft.
Using one entry and one exit, with employees checking what is coming in and out, also helps in Costco’s loss prevention. High-ticket items have memory cards inside the packaging that track the movement of store items, and others are controlled by limiting displays to cardboard items that must be purchased and then redeemed at the service desk.
Some Laws and Court Backlogs Often Mean Shoplifters Who Are Caught Won’t Go to Trial
Proposition 47, passed in California, has reduced criminal penalties for shoplifting goods less than $950. Similarly, backlogs in court calendars across the United States mean that many of the shoplifters who are actually caught never even go to trial.
Overworked store managers may not feel they have time to deal with shoplifters when there will be no consequences for the shoplifters. Ultimately, solving the problem of group shoplifting is going to take a concerted effort among businesses and law enforcement.