The 2023 National Retail Security Survey commissioned by the National Retail Federation collected responses from 177 retail brands covering 97,000 retail locations in the U.S. collectively responsible for $1.6 trillion in annual retail sales in 2022. The value of theft, ranging from shoplifting to looting, amounted to $112 billion, up from $94 billion in 2021. The emergence of organized retail crime is responsible for the 15 percent increase in shrinkage rate in 2022, rising to 1.6 percent.
David Johnston, Vice-President for Asset Protection and Retail Operations at the National Retail Federation, stated, “Retailers are seeing unprecedented levels of theft coupled with rampant crime in their stores and the situation is only becoming more dire.” He added “Far beyond financial impact of these crimes is the violence and the concerns over safety that are a priority for all retailers.”
Two-thirds of respondents noted a high level of violence and aggression among participants in organized retail crime as evidenced by store video images that have been posted on national media. Almost half of respondents have a “hands off” policy regarding apprehension of shoplifters to avoid confrontation and violence. Preventive measures adopted by retailers include increased staffing by company personnel and the use of third-party security services. More than half of companies reported providing workplace violence training for store personnel.
During the past three years, the range of products targeted by organized retail crime has expanded from high value clothing and accessories to common products that have resale potential including kitchen accessories, designer footwear, batteries, infant formula and even energy drinks.
In severely impacted communities including Los Angeles, San Francisco, Houston, Seattle, Portland and New York, legislators are considering lowering the felony theft threshold, eliminating cash bail. Local authorities are assigning police to specialized units to deter organized retail crime. Municipalities will lose revenue from taxes and tourism as stores and restaurants close and hotels post lower occupancy rates as a result of cancellations of trade shows and conferences.
The cost of over $112 billion incurred in 2022 attributed to shoplifting and looting is borne by shareholders of companies and customers alike. Pass-on costs through retail margins, higher insurance premiums and increased taxes to compensate for losses extends the range of victims of widespread retail crime to the entire population.