NRF Survey: Organized Theft Taking Bigger Bite Out of Retailers

About six in 10 (61%) respondents reported their companies are prioritizing organized retail crime more than they were five years ago.

WASHINGTON, D.C. — Organized retail crime (ORC) has been surging, according to the 16th annual Organized Retail Crime study by the National Retail Federation (NFR).

Each year the study queries loss prevention executives from a cross-section of large and midsized retail companies. NRF conducted the latest installment of the survey prior to the full economic impact of the coronavirus pandemic was seen. The trade group says it may not reflect the impact, if any, that the pandemic has had on organized retail crime.

The survey found that ORC activity increased 68% in a year-over-year comparison. Losses averaged $719,548 per $1 billion in sales. It was the fifth year in a row that losses topped the $700,000 mark.

“Retailers are seeing more cases and higher losses as organized crime continues to target stores, warehouses and cargo,” NRF Vice President for Research Development and Industry Analysis Mark Mathews says. “Retailers are investing millions to fight these crimes, but they need more help from law enforcement and, most of all, they need tougher laws that recognize the difference between petty shoplifting and professional crime for profit.”

Current losses compare with only $453,940 in 2015, and the increase of nearly 60% comes as many states have raised the threshold of what constitutes a felony, allowing criminals to steal more before being subject to stronger penalties than a misdemeanor. Among retailers surveyed, 64% have seen an increase in average ORC case values in states where that has happened, up sharply from 51% who said the same each of the past two years.

Almost two-thirds (61%) of retailers said their companies are prioritizing ORC more than they were five years ago, with 52% allocating more technology to reducing risks such as ORC-related thefts and 36% increasing loss prevention budgets.

The NRF survey found that 52% of retailers were planning to revise return policies to make it harder for criminals to exchange stolen goods for store credit. Forty-five percent of those surveyed said that they were examining methods regarding how they might revise their policies for point-of-sales transactions.

The top five cities for ORC in the past year in order were Los Angeles, Chicago, Miami, New York and San Francisco. To download the complete report, go here.

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