Crime Hurts Retailers During the Holidays

December 2, 2011 -

Crime is taking a bite out of retailers' fairly decent sales numbers for the holiday season so far, according to trade group the National Retail Federation. According to estimates from the group, around 40 percent of theft is caused by organized crime rings, "returns" fraud, and shoplifting. Crime has costs U.S. retailers tens of billions of dollars already according to the group.

"This year, the indicators we have seen year-to-date all show that retail crime has been on the rise. Organized retail crime, which is professional shoplifting and return fraud, where people return things back to the store, is up," said Joseph LaRocca, the NRF's Vice President Of Loss Prevention. "The shoplifting activity is consistent with last year so the number is very high."

According to data from the group collected every year, retailers lost $35.3 billion in 2010 and $33.5 billion in 2009. Shoplifting accounted for the lion's share of "lost merchandise," while organized crime, return fraud, inventory mistakes and labeling errors accounted for the rest. 

Retailers are trying to use new technology to thwart much of the illegal activity this year including hiring specialized loss prevention personnel and by using digital cameras to track those who try to steal. These high-tech cameras are in more stores than ever this year mainly because they have become less expensive. While the cameras seem to help, they won't stop everyone and some thieves are downright clever - finding blind spots and using other tactics to thwart security..

"We have seen shoplifting gangs continue to evolve in terms of their skill and technology. Over the years, we have seen an increase in organized crime activity," said LaRocca. "In 2010, 89% of retailers polled were victims of organized shopping crime. In 2011, it was 94.5%. So, we have seen organized retail crime on the rise and the skill of these groups and the types of tools they use continue to advance."

Many retailers also now have a special database to catch people who return items they never purchased in the first place. The stores are doing this by keeping track of who returns the most items in order to figure out who may be playing the system.

But the most effective way to prevent losses from theft is the employees, according to LaRocca. He says that a vigilant worker is the best defense in thwarting crimes before they ever happen.

Source: CNBC


Comments

Re: Crime Hurts Retailers During the Holidays

Oh, I know! Let's deal with this the MPAA/RIAA way! All customers are thieves and therefore must provide a DNA sample, submit to an extensive (and potentially harassing) pat-down, and understand that even if they didn't steal anything, they're likely to get legal threats.

Re: Crime Hurts Retailers During the Holidays

never mind the fact with a few moments pressure most managers fold and give a person with no receipt a refund on often clearly stolen merchandise.

my GF has run into that while working at Macys. Her managers will force through nearly any return even if theres no receipt, no payment proof of any kind, and the item has clearly been tampered with to remove the security tags... brilliant!

they need to go back to "no receipt no return of any kind" unless it can be pulled up in the system.

this store credit/replacement is just stupid, and as i said, most managers just don't care enough and will issue a refund anyways.

Re: Crime Hurts Retailers During the Holidays

Yeah.. I recall one return when I worked retail, not only was there no recipt, but the person had obviously lifted the item from another store and cut it up to look like it was multiple smaller items, then tried to return each of them in plastic bags.

The manager accepted the return under the idea that it resulted in a happy customer how might return and actually buy things someday.

Re: Crime Hurts Retailers During the Holidays

I was actually going to bring this up.

Most stores, if you threaten to go up the corporate ladder to complain, will eventually just fold and tell the store-level employees to just do the damn return and stop bothering them with such petty concerns. At GameStop I've dealt with this first hand. People who don't even understand the return policy in the first place, but will go straight to screaming in your face because some other employee told them that they can have money for free and they deserve their money back because they said so! Never mind that we can't just resell a 300$ PS3 that's been ripped out of the box and crudely stuffed back in a bag from another store.

Places like Wal-Mart, especially, take returns on everything. They have a reputation of being that store with the employees who just don't care enough to follow procedure or even bother checking where or when it was bought. On top of their price matching guarantees and careless ad department, Wal-Mart is often giving away money. I've had co-workers shop there because some botched sales ad allowed them to get a brand new 60$ game for 15$.

I'm sure there are actually tons of thieves out there that do contribute to this issue, but I'm fairly sure that a large percentage of that money lost is due to poor control of returns and exhanges.

Re: Crime Hurts Retailers During the Holidays

Giving how often receipt information is stored digitally there's no reason for that to happen.

Re: Crime Hurts Retailers During the Holidays

trick is, some stores STILL don't store this stuff digitally! or only retain it for less than 24 hours to a week.. wth?!

all that money they invest in new security and they still allow these ripped off items to be returned for REFUNDS!! i asked for  a REPLACEMENT on something i purchased once that ended up dieing quick (a Wireless adapter for the Xbox controller to the PC at best buy) and they gave me hell. i even had a receipt, and the purchase was only like 3 days old! the clerk tried desperately to find some reason not to take it back until the manager just told'em to do it.. i didn't want a refund, i just wanted a working product...

i can half forgive another instance, again receipt in hand, where at a small game shop the clerk tried to deny me a replacement for a borked Retrogen handheld given their equip is crap. but i hadn't even had the thing 2 days, the store was RARELY busy, and she insisted somehow she never remembered having a Blue one.. it was the only one they had! and it was the SAME clerk i had when i bought it! how do you forget the only one you had in stock? then she tried saying it was damaged.. A. it never had a seal, the box was magnetically closed, and B. i never even removed the protective film from the screen! thankfully i know what the defect is (i say is, because the product is designed with a MASSIVE and completely FUBAR flaw that'll break it with normal use within minutes just by inserting a cartridge) so i rigged the new one and have had it working spectacularly since. awesome device, but that flaw is just unbelievably stupid and easy to fix.. for $60 usd you'd think it wouldn't exist..

sometimes i think i'd be better off going back without receipts, cause i swear a person without it gets through the line faster!

but yeah, funny how they don't have the stuff stored as they should in many stores, and even with proper documentation they love to give ya a hard time.. but without.. nearly no problem.

damn, i ranted again.. sry.

 
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