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$112 Billion Retail Theft Losses in 2022 Prompts Action October 07, 2023 (0 comments)


New York, NY--The National Retail Federation (NRF) unveiled alarming statistics on Tuesday, shedding light on the escalating issue of retail theft, which led to a $112 billion in losses in 2022. 

[Image via Unsplash]

The sharp uptick from $93.9 billion in 2021 has propelled numerous retailers to reevaluate and modify their operational strategies.

According to a Los Angeles Times report, David Johnston, NRF’s Vice President for Asset Protection and Retail Operations, voiced concerns over the "unprecedented levels of theft" and escalating in-store crime, emphasizing the dire nature of the situation. 

The annual survey conducted by NRF encapsulated responses from 177 retail brands spanning 28 sectors, representing over 97,000 retail locations with a cumulative annual sales of $1.6 trillion.

The report noted that the survey categorized the sources of shrinkage, a term denoting lost inventory, which totaled $112.1 billion in 2022. 

Theft constituted a significant chunk, accounting for 65% of the shrinkage. External theft, encompassing organized retail crime, contributed to 36% of the losses, while employee theft accounted for 29%. Process and control failures chalked up 27% of the losses, with the remaining 7% categorized as "other" or "unknown."

An outcome of the rising crime rates is the amplified focus on loss prevention, with 46% of retailers enhancing the use of third-party security personnel. 

Additionally, 34% of the survey participants have bolstered their payroll to support risk mitigation efforts. 53% have ramped up employee training to address potential violent encounters from theft or other criminal activities.

The report noted that the intensification of in-store violence has been a focal concern, with 88% of the surveyed retailers noting increased aggressiveness and violence from shoplifters compared to the previous year. 

The repercussions have driven 45% of retailers to curtail operating hours, 30% to alter in-store product offerings, and 28% to shutter store locations as a direct response to the crime surge.

In light of the escalating organized retail crime, notable efforts are underway to combat this menace. California's Attorney General, Rob Bonta, initiated a new scheme in June, rallying over a dozen retailers and online marketplaces to enhance information sharing amongst law enforcement, victimized retailers, and online platforms where stolen goods are peddled. 

This initiative aims at fortifying the prosecution efforts against organized retail crime, distinguishing it from sporadic shoplifting incidents.

As retailers grapple with the burgeoning threat of theft and violence, the focus gradually shifts toward creating a safer and more secure shopping environment to mitigate future losses.

Learn more in the entire Los Angeles Times report.

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