Loss Prevention Research Council Weekly Series Episode 140 - USA Retail Crime Trends and Shopping While Drunk
On this episode, Dr. Hayes discusses the recent ICSC Summit for Organized and Violent Crime, where we hosted industry partners and retailers to help create a wider strategy for prevention of these issues, Tony D’Onofrio calls in from Italy to discuss theft trends in stores, mentioning margins in retail and masking in NYC. Lastly, Tom brings us home with new updates for AI in retail including text to video and generative video AI, and discusses the recent banking issues in the US.
Shoplifting Climbs as In-Store Shopping Returns
https://www.wsj.com/articles/shoplifting-climbs-as-in-store-shopping-returns-ad3b8734
Let me start this week with a new article from the Wall Street Journal titled “Shoplifting Climbs as In-Store Shopping Returns.”
According to the article, Retailers say theft is rising as more people shop in stores, cutting into profits that were already under pressure.
“We definitely had an uptick since last year,” Macy’s Chief Executive Jeff Gennette told analysts earlier this month. “It’s an industrywide trend.”
Target Corp. said in November that it expected the problem, known in the industry as shrink, to reduce gross margins for the recently completed fiscal year by more than $600 million. TJX Co.’s and Macy’s Inc. also called out higher shrink rates in recent calls with analysts.
“Theft is growing at a faster rate than sales,” said Dean Rosenblum, a senior U.S. retail analyst at Bernstein Research. Mr. Rosenblum said theft is becoming a big enough problem that it’s starting to affect margins, which is why retailers are talking about it more frequently.
“Seven years ago, internal theft was the largest category of loss by retailers,” said David Johnston, the NRF’s vice president of asset protection and retail operations, referring to theft by employees. “Now, it’s external theft.”
Retailers are combating the problem by adding security guards and cameras to stores, locking up goods and making use of facial recognition software to help identify repeat offenders.
Mr. Gennette said Macy’s is using radio frequency identification tags to better track inventory, adding more security personnel to stores and securing high-end brands with locked cables and sensors.
TJX finance chief John Klinger told analysts in February that an unexpected increase in shrink hurt margins by 0.60 percentage point in the recent quarter. That follows higher shrink charges in the same quarter a year ago. The company said it expects shrink to remain similar to current levels for the next two years.
“Retailers are locking up everything from shaving cream to soap,” said Oni Powell, a 46-year-old office manager who lives in Porter Ranch, Calif. “These should be things that are quick and easy to grab and go. But now I’ve got to find an employee to unlock them for me.”
A month ago, New York City police asked shoppers to take off their face masks before entering stores, a measure intended to help them better identify criminals. The plea came after four unidentified men stole roughly $1.1 million of goods from a Queens jewelry store.
NYC Mayor Adams leans right again, says masks are protection against police not COVID
https://fism.tv/nyc-mayor-adams-leans-right-again-says-masks-are-protecting-against-police-not-covid/
Switching stories but staying on the topic of crime, interesting news from FISM TV on what New York’s Mayor Eric Adams is saying.
New York City Mayor Eric Adams said last week that some store customers who wear masks are more likely trying not to get caught shoplifting than stopping the spread of COVID.
Mayor Eric Adams: "Let's be clear, some of these characters going into stores that are wearing their mask, they're not doing it because they're afraid of the pandemic, they're doing it because they're afraid of the police. We need to stop allowing them to exploit the safety of the pandemic by wearing masks, committing crimes.
[NYC Mayor Eric Adams], who pushed one of the strictest and longest mask mandates in the country, is now pushing the use of facial recognition technology to reduce rampant crime across the Big Apple. With the help of facial recognition software, he says he hopes to crack down on not only shoplifting but repeat offenders who may be linked to more serious and violent crimes.
USA Consumers Spent $14 billion While Drunk
https://chainstoreage.com/survey-us-consumers-spent-14-billion-shopping-while-drunk
Finally, interesting read from Chain Store Age also this week.
Shoppers under the influence appear to have influence on retail sales.
According to new data from the Finder Consumer Confidence Index, 17% of roughly 2,100 surveyed U.S. consumers have made a purchase while under the influence of alcohol in the past 12 months, spending roughly $309 each for a total of $14 billion.
The top drunk shopping categories are shoes, clothes or accessories, and food, with 47% of respondents who have shopped drunk saying they bought items in these categories. Other popular drunk spending categories were alcohol, cigarettes, and gambling, all tied with participation of 34% of eligible respondents.
Motor vehicles come out as the most expensive category at an average spend of $2,038, although it was the lowest-ranked category (besides “other) with 16% of respondents who have shopped drunk in the past year purchasing a motor vehicle while intoxicated.
