Target announced it would be shutting down select stores across the country, citing violence tied to ongoing organized retail theft. In Philadelphia, more than 50 people were arrested after looters ransacked multiple stores over two nights.The string of incidents resulted in the temporary closure of all state-run liquor stores in the 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 has been released showing just how much theft is costing these businesses.
The annual Retail Security Survey from the National Retail Federation (NRF) 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% 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.
Retailers are seeing unprecedented levels of theft coupled with rampant crime in their stores, and the situation is only becoming more dire. Far beyond the financial impact of these crimes, the violence and concerns over safety continue to be the priority for all retailers, regardless of size or category
David Johnston, National Retail Federation
In August, Target CEO Brian Cornell said his company has seen a 120% increase in shoplifting incidents with violence or threat of violence since the beginning of the year.
Forty-five percent of the retailers surveyed said they have reduced specific store operating hours to combat the crime. Twenty-eight percent reported closing specific stores, as Target is doing. The retailer is 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.
