Major US retailers say organized retail crime has turn into a multi-billion dollar problem, however the effectiveness of their strategies to tackle this problem and data validity have generally been questioned.
Lately, firms similar to Home storage, Lowe, Walmart, Best offer, Walgreens AND CVS they’re alarming about organized gangs of thieves looting their stores and resell goods on online marketplaces.
They poured money into anti-theft strategies like plastic casings, metal detectors, motion-detection monitors and AI-powered cameras, and warn that if the issue doesn’t improve, consumers could find yourself paying the worth.
“Theft is an issue. It’s higher than previously,” Walmart CEO Doug McMillon told CNBC in December. “If this is not corrected over time, prices will probably be higher and/or stores will close.”
The issue, nonetheless, is not as clear cut as retailers and industry groups make it out to be.
Research by the National Retail Federation shows a decline in retail sales cost retailers $94.5 billion in 2021 z $90.8 billion in 2020but the information is largely qualitative and can’t be verified because it was collected from an anonymous group of shops.
As well as, the $94.5 billion in losses relate to the general decline, which is the difference between the inventory the corporate records on its balance sheet and what it could actually sell. This difference applies to items which have been stolen from stores, but in addition includes inventory that has been damaged, lost or stolen by employees.
NRF figures show that external retail crime accounts for just 37% of those losses, or about $35 billion.
Not less than one major retailer has recently admitted that the issue could have been exaggerated.
“Perhaps we cried an excessive amount of last yr,” Walgreens chief financial officer James Kehoe said in a phone call with an investor in January when asked in regards to the shrinkage. “We’re stabilized,” he added, saying the corporate was “pretty comfortable with where we’re.”
Even so, law enforcement and retailers say organized retail crime stays an issue and say they’re behind their data.
“I can say that in our world we all know that crime is on the rise. We see this every single day in our stores,” Scott Glenn, Home Depot’s vp of asset protection, told CNBC. “Our internal information shows us that this is year-on-year, growing at a double-digit rate.”
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