Top 5 Cities for Retail Theft in US
Retail theft is a growing problem across the nation, but five cities in particular are seeing a spike in retail crime, according to a report from the National Retail Federation (NRF).
Los Angeles came in as the city with the highest rate of retail crime, while San Francisco and Houston were the next two. New York City and Seattle rounded out the top five.
Retail crime is a growing problem in the U.S., amounting to $112.1 billion in losses last year, up from $93.9 billion in 2021, according to the NRF.
For the new National Retail Security Survey’s list for overall retail crime, data was collected from 177 retail brands across 28 sectors. It defined theft as any action “conducted with the intent to convert illegally obtained merchandise, cash, cargo or cash equivalent into financial gain, typically through their online or offline sales.”
This year, 78 percent of the companies said organized retail crime was more of a priority than in 2022, but the severity of the issue was largely determined by location.
The cities with the highest rates of retail theft tend to be those with higher overall population and crime numbers, but it also reflects a need for local authorities to enforce harsher consequences, according to Melodie van der Baan, CEO and co-founder of inventory selling platform Max Retail.
“Local governance is a large reason for increases in shoplifting in certain regions,” van der Baan told Newsweek. “If consequences for such crimes are light in a given area, perpetrators continue to act in those cities.”
Additionally, store employees are encouraged not to interfere with theft, even when it takes place right in front of them, due to the risk of physical harm or legal damage to the company, leading to even greater numbers of thieves getting away with their crimes.
Impact of Retail Crime
Surging levels of retail crime have caused several chains to close stores or increase prices due to lost inventory. It also causes an increased risk for retail workers, who are facing some of the theft and violence.
“Retailers are seeing unprecedented levels of theft coupled with rampant crime in their stores, and the situation is only becoming more dire,” National Retail Federation Vice President for Asset Protection and Retail Operations David Johnston said in a statement. “Far beyond the financial impact of these crimes, the violence and concerns over safety continue to be the priority for all retailers, regardless of size or category.”
Target announced it would be closing nine stores due to its skyrocketing shoplifting levels.
“We cannot continue operating these stores because theft and organized retail crime are threatening the safety of our team and guests, and contributing to unsustainable business performance,” Target previously said in a statement on September 26.
Walmart dealt with similar issues and decided to shutter four stores in Chicago. The company’s CEO also warned that price increases could be on the way up as inventory disappears.
“If that’s not corrected over time, prices will be higher, and/or stores will close,” Doug McMillon said in a CNBC interview last year about the crime rates.
Walmart has closed 21 stores across 12 states as the crime continues to plague stores.
While the surge in crime has been noted especially over the past several years, it ultimately comes down the companies’ ability to predict this behavior and remain profitable in spite of it.
Retailers that focus on high margins and inventory optimization will ultimately be the ones that succeed, even as crime rates stay high.
“Theft is a crime as old as time,” van der Baan said. “It is the responsibility of the retailer to predict shrink. They can mitigate it with solid management and processes at the store level.”
