Increasing Theft and Violence Continue to Harm Retailers, Retail Workers, and the Communities they Serve

Gainesville, Florida, September 26, 2023 – According to the National Retail Federation’s 2023 National Retail Security Survey (NRSS), retail crime continues to harm retailers, their employees, and the communities they serve. This survey, conducted in partnership with the Loss Prevention Research Council, shows that retail theft, violence, and other types of retail crime increased throughout the industry in 2022.

“Addressing violent crime and protecting employee safety remain retailers’ greatest priority” according to Dr. Read Hayes, Director of the LPRC and Research Scientist at UF. Dr. Hayes has been in the industry for nearly 40 years, and suggests that “retailers are facing challenges [he] would never have imagined a decade ago.” Unfortunately, according to David Johnston, NRF Vice President of Asset Protection and Retail Operations, the “situation is only becoming more dire.”

According to the NRSS, 88% of retailers reported shoplifters are more aggressive and violent when compared to one year ago. The report also reveals that 72% of retailers report violence during the commission of a crime is more of a priority compared to one year ago, while 65% report guest-on-associate violence is more of a priority.

“Retail violence and aggression is often related to organized retail crime, especially localized forms of ORC,” according to Dr. Cory Lowe, Senior Research Scientist at the LPRC and principal investigator on the NRSS for the LPRC. The report defines ORC as “theft or fraud conducted with the intent to convert illegally obtained merchandise, cash, cargo or cash equivalent for financial gain.” Nevertheless, 67% of retailers reported that aggression and violence associated with organized retail crime has increased in the past year.

According to Lowe, individuals and groups engaged in ORC often target items that have several of the CRAVED characteristics; that is, they are “concealable, removable, available, valuable, enjoyable, and/or disposable.” These characteristics make them ideal targets for individuals seeking to convert merchandise to cash. For example, items such as laundry detergent pods, handbags, fresh and frozen seafood, athletic shoes, over-the-counter medication, infant formula, and skin and beauty products are often targeted, according to the NRSS. This year, retailers identified Los Angeles, San Francisco/Oakland, Houston, New York and Seattle as the cities and metropolitan areas most affected by ORC.

Of course, all of this contributes to increased retail shrink. According to the NRSS, the average industry-wide shrink rate increased from 1.4% in fiscal year 2021 to 1.6% in fiscal year 2022. This represents approximately $112 billion in losses in 2022, up from an estimated $94 billion in 2021.* However, shrink differs considerably by sector. For example, pharmacy, grocery, department stores, and mass merchandise stores reported shrink rates of over 2%, on average. Alternatively, retailers in the jewelry, watch, home furnishings and furniture, and footwear sectors reported shrink rates of less than 1.5%, on average.

Dr. Lowe cautions readers to avoid conflating the retail shrink problem with the harms of retail crime because “shrink is comprised of both criminal and non-criminal sources.” For example, in fiscal year 2022, retailers attributed 36% of shrink to external theft; 29% to employee theft; 27% to process, control failures, and errors; 6% to unknown sources; and 1% to other sources, on average. However, the second problem according to Lowe, is that “shrink does not account for many of the other harms associated with retail crime, especially violent crime.”

Given the challenges described in the report, retailers are dedicating additional resources to address retail crime and losses. As mentioned previously, workplace safety remains a key priority among retailers, and 54% report they are increasing employee workplace violence training. However, 34% reported increasing internal payroll to address risks, 46% have increased their use of third-party security, and 54% reported they are increasing their budgets for technology and software solutions.

“Retailers remain committed to innovating to protect vulnerable people, places, and property” according to Dr. Hayes. As the NRSS shows, retailers are increasingly turning to mobile surveillance units to protect parking lots, and are using radio-frequency identification (RFID) technology to provide better inventory insights. However, “retailers are continuing to explore innovative technologies” according to Dr. Hayes, and are “trialing technologies such as body-worn cameras and computer vision analytics.” 

However, retailers have also adjusted their policies in response to these changes. According to the NRSS, 41% of respondents reported that none of their employees are authorized to stop or apprehend shoplifters. According to Dr. Lowe, retail companies adopt these “hands off” policies because retail offenders often pose a serious threat to retail employees and guests. However, this puts “retailers in a difficult position because it creates the impression among retail offenders that no one will intervene in retail crimes.”

While there is a “role for technology, tactics, and company policies to play in addressing these issues, these are only part of the solution,” according to Dr. Lowe. For fiscal year 2022, retailers attributed the largest portion of retail shrink to shoplifting, burglary, robbery, and other crimes committing by non-employees. Lowe suggests that “those who victimize retailers and retail workers come from, and return to, the surrounding communities,” because of this, “changes to public policies and practices must be part of the solution.”

*The 2021 figures have been updated to reflect the U.S Census Bureau’s April 2023 revisions to retail sales; therefore, losses differ from what was reported in the 2022 NRSS.


About the NRSS

The 2023 National Retail Security Survey was conducted online by senior loss prevention and security executives in the retail industry. This year’s results contain insights from 177 retail brands, which accounted for $1.6 trillion of annual retail sales in 2022, and represent more than 97,000 retail locations across the United States. The study was done in partnership with the Loss Prevention Research Council and is sponsored by Appriss Retail. Click here to view the report.


About the NRF
The National Retail Federation passionately advocates for the people, brands, policies and ideas that help retail thrive. From its headquarters in Washington, D.C., NRF empowers the industry that powers the economy. Retail is the nation’s largest private-sector employer, contributing $3.9 trillion to annual GDP and supporting one in four U.S. jobs – 52 million working Americans. For over a century, NRF has been a voice for every retailer and every retail job, educating, inspiring and communicating the powerful impact retail has on local communities and global economies. nrf.com


About the LPRC
The Loss Prevention Research Council was founded in 2000 by leading retailers and Dr. Read Hayes, an NRSS co-founder, in an effort to support the evidence-based needs of loss prevention decision-makers. To date, the LPRC has conducted over 300 studies with retailers and other research partners. The LPRC strives to provide comprehensive research and development opportunities, and collaborative spaces for members that enable the innovation of retail loss and crime control solutions. lpresearch.org


LPRC and ISCPO Partnership Press Release:

With disruptions causing over $4 trillion dollars in profit loss according to Reuters, supply chain challenges continue to affect retailers, manufacturers, and other logistics companies alike. Strategic partnerships and collaboration are needed to ensure the maximum safety & efficiency during these demanding times.

As of January 10th, 2022, the LPRC and ISCPO have drawn up a partnership in the spirit of collaboration to cultivate a Supply Chain Community for both organization’s members and the overall supply chain industry.

The Loss Prevention Research Council (LPRC), a twenty-two-year-old industry leading research organization that collaborates with over 70 retail member organizations, 80 protective solution companies, law enforcement, industry partners, and academic leaders, for the goal of providing evidence-based solutions addressing loss, safety, and fraud prevention, and the International Supply Chain Protection Organization (ISCPO), a non-profit professional association that connects members from a wide array of sectors across the global supply chain including retail, wholesale, eCommerce, manufacturing, insurance, risk management/legal, distribution, operations, and logistics, as well as, law enforcement and government agencies, established to promote collaborative efforts of networking, benchmarking and resource development for security and asset protection professionals across the global supply chain, have decided to enter into a partnership to maximize the value of both organizations and the industry at large.

Both the LPRC and ISCPO each bring tremendous value to this new endeavor. With natural disasters, workplace violence, and many other supply chain logistical issues at the forefront of industry concerns; the LPRC/ISCPO partnership is ready to combat these issues by mobilizing their communities to identify, research, and address these acute and chronic issues. Now with a joint Supply Chain Protection Working Group, industry leaders and solution providers, will continue to have monthly engagements to help work through a variety of industry issues, and come together to research specific concerns and solutions.

The LPRC and the ISCPO are both proud and excited to enter this partnership and to embark on a journey to bring mitigation strategies, problem solving solutions & research to the supply chain industry as a whole.

Should you have any questions about this partnership please feel free to reach out to:

Rhett Asher – ISCPO President & Chairman

Email: Rhett.asher@iscpo.org

Diego Rodriguez – LPRC Supply Chain Protection Working Group Facilitator & LPRC Representative

Email: Diego@lpresearch.org

North American retailers experienced the highest average shrinkage – unexpected losses due to crime, administrative reporting, and exceptions to standard operating practice – in three decades as reported by the National Retail Federation in 2020. The need to collaborate in a non-competitive manner has become increasingly more important to retailers. The Loss Prevention Research Council (LPRC) continues to provide science-based programs and systems that have a positive effect on controlling these unnecessary expenses, and the heightened interest from the retail community has been overwhelming.

Dr. Read Hayes, University of Florida Research Scientist/Criminologist and LPRC Director, has announced a partnership with Lighthouse Consultants (LHC) to support ongoing efforts to engage with the retail community.

LHC is made up of an industry-leading and experienced group of professionals: Chad McIntosh, former VP LP and Risk Management at Bloomingdales, Stephen O’Keefe, former VP LP and Risk Management at Walmart Canada, Russ Tate, 35+ years of loss prevention and security solution experience, and Jeff Powers, loss prevention and security consultant. LHC will partner with LPRC to help drive membership and awareness of their unique and compelling, science-based, results-driven expertise.

“LPRC is proud and excited to be working with LHC as we focus on the next level expansion of our research and results community,” said Dr. Hayes.

For more information about how to join the LPRC, please contact info@lpresearch.org.

As a response to the current pandemic, the LPRC is providing retailers and practitioners with a COVID-19 resources page. This landing page includes:

  • Our most recent webinar, COVID-19: How Retail Offenders Take Advantage of Crisis Situations
  • Our special CrimeScience episode, COVID-19 and Retail’s Forecast
  • Federal and state resources
  • COVID-19 Initiatives Calendar
  • Access to our ongoing projects
  • News and announcements on the current pandemic
  • A contact form for any specific questions for our research team

 

Access the new page by clicking here.

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LPRC director Dr. Read Hayes was recently interviewed by NBC News about how Amazon’s Ring doorbells have affected porch piracy. Read what he has to say in this in-depth article here.

The Fear of Crime webinar, presented by Research Team Leader Kenna Carlsen, is now available in the Knowledge Center! Learn about trends in fear of crime, including identifying those individuals who report the most fear, and understanding common factors influencing it.

Click here to watch.

 

LPRC Director Dr. Read Hayes and Innovation Manager Jordan Burchell were featured in this informative piece by WSB-TV! Partially filmed during IMPACT 2019, WSB-TV explores the true costs behind organized retail crime, and how places like the NextRetail Research Center can help.

LPRC’s Working Group Awards are given to leaders and co-leaders who demonstrate strong participation, maintain a positive and interesting call environment, and whose deliverables affect a cross-section of retail formats.​ Their commitment and dedication improves our research and results community, and for that we are grateful. The LPRC is pleased to announce the 2019 Working Group Award Recipients:

 

Retail Fraud Working Group

  • Leader(s): Trish Svebek, Dollar General
  • Co-leader(s): Sean O’Brien, Target / James Kendall, Target

Organized Retail Crime Working Group

  • Leader(s):  Jessica Zwart, Target / Bobby Haskins, Auror
  • Co –Leader(s): Ben Dugan, CVS / Abe Gonzalez, Bloomingdale’s

Product Protection Working Group:

  • Leader(s): Adam Hartway, InComm/ Scott Ziter, Price Chopper
  • Co –Leader(s): Andrea Guthrie, Dick’s/ Jeremy Henderson, TJX

 

With self-checkout machines suddenly everywhere you may be wondering…with no one to watch shoppers, don’t they just steal stuff?

The answer, in short, is yes. While technology can improve a lot of things, it can’t change human nature.

But, say retail industry experts, for many stores, the machines are worth the hassle. Indeed, shops ranging from superstores like Target and Walmart to convenience chain CVS to local mom-and-pop groceries have all been adding machines. One recent study suggested globally, self-checkout could continue to grow 10% a year for the next five years.

So what gives? While shoppers may love or hate self-checkout, for stores it often comes down to one thing: Machines mean fewer cashiers, and that can translate to big savings, even if it encourages some shoppers to take the five-fingered discount.

Continue reading: http://money.com/money/5657848/shelf-checkout-encourages-shoplifting/