The Wall Street Journal had a piece over the weekend about how, as people return to physical stores, retail theft is rising, cutting into companies' profits.
“Theft is growing at a faster rate than sales,” Dean Rosenblum, a senior U.S. retail analyst at Bernstein Research, tells the Journal, which quotes Rosenblum as saying that "theft is becoming a big enough problem that it’s starting to affect margins, which is why retailers are talking about it more frequently."
There are, the story notes, two kinds of theft - shoplifting and organized retail theft, which is a much bigger problem.
The story points out that while shrink in 2021 fell back to 2018 levels, "external theft, which includes organized retail crime in addition to regular shoplifting, has become a bigger piece of the pie. Organized retail crime, involving rings that steal from stores in bulk and then peddle the goods online, cost retailers nearly $720,000 for every $1 billion in sales in 2019, the most recent year the NRF published such figures. That was an increase of 50% from 2015, it said."
- KC's View:
The Journal story says that there are some legislative responses in play: "New legislation signed into law by President Biden last year, called the Inform Consumers Act, will make it harder for criminals to resell stolen goods online. The Combating Organized Retail Crime Act of 2023 currently making its way through Congress seeks to pool expertise and provide more tools to prosecute criminals and recover stolen goods."
But I do think this falls into the broader category of the fabric of society unraveling, and people - for a wide variety of reasons - stop adhering to the social compacts that used to bind us together. Or at least most of us together.
This is easier said than done, but I've always subscribed to the William Bratton (who ran police departments in Boston, New York City and Los Angeles) approach to this issue - one of the most important ways one stops major crime is to stop the small crimes. That approach is out of favor at the moment, and we see the result. Retailers have to increase their own security measures to make sure their stores are safe and secure, but they deserve the support of law enforcement when attempting to protect their businesses.