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Illustration by Security Management

Retailers See Rise in Organized Retail Crime

Retailers continue to face serious challenges from organized retail crime, which averaged more than $700,000 per $1 billion in sales a new survey found.

“Every year, the vast majority of retailers surveyed report being a victim of [organized retail crime], and 2019 is no different,” according to the National Retail Federation’s (NRF’s) Organized Retail Crime Survey. “This year, 97 percent said they’ve been victimized in the past 12 months. Despite retailers’ best efforts, the industry has yet to see a meaningful reduction in the impact of these crimes.”

The 2019 survey found that for the fourth year in a row, average losses topped more than $700,000 per $1 billion in annual sales. There is not one specific reason for the continuing rise in crime, but survey respondents said that rising felony thresholds and increasingly violent organized retail crime gangs are all factors.

“About a quarter of respondents said their companies have made changes to address [organized retail crime] or plan to do so, including changes to point-of-sale policies and return policies,” according to the survey. “And roughly half are allocating additional technology resources and increasing their loss prevention budgets to address risk overall.”

Organized retail crime gangs “typically steal a mix of high-end designer products and easy-to-fence everyday necessities,” the NRF explained. “Top items stolen included designer clothing, infant formula, razors, designer handbags, laundry detergent, denim pants, energy drinks, allergy medicine, and high-end liquor, among others.”

Surveyed organizations also said that while local law enforcement was helpful in responding to organized retail crime, a U.S. national law is needed because crime often crosses state lines—making it a federal crime.

Many U.S. states have also increased the threshold for what constitutes a felony, which means criminals can steal more before being subject to stronger penalties for the theft.

“Among retailers surveyed, 51 percent had seen an increase in average organized retail crime case values in states where that has happened,” the NRF said.