Organized retail crime (ORC) is increasingly alarming the retail industry, with Target recently highlighting a staggering $1.2 billion projected loss due to inventory shrinkage, primarily from ORC. Target CEO Brian Cornell revealed that violent incidents in brick-and-mortar stores, resulting in significant theft, are increasing and span across diverse merchandise departments. Cornell emphasized the dual impact: products stolen are no longer available for customers who depend on them, and the threat to the safety of guests and employees.
ORC has escalated in recent years, with thieves stealing goods to resell at lower prices in the face of rising inflation. In 2021, goods stolen from stores resulted in $94.5 billion in losses, an increase from $90.8 billion in 2020, according to a study by the National Retail Federation (NRF). NRF’s analysis found that 16% of the 132 crime groups surveyed used at least one violent tactic in stores. The escalating trend has prompted many retailers to identify ORC as a growing concern over the last five years.
The ORC crisis is not just a financial drain but also endangers employees and customers, disrupts store operations, and damages communities. This intensifying problem led some retailers to exit high-crime cities like San Francisco in 2023, impacting the retail and local community.
Retailers, including Target, are implementing countermeasures such as enhanced worker training and hiring more “asset protection” personnel. While lockable cases for high-theft items like mouthwash are one part of the solution, there’s recognition that the problem is complex and multifaceted.
Despite these efforts, it’s recognized that this is not exclusively a retail problem but one that implicates broader community and societal factors. The rise in ORC is symptomatic of larger issues such as criminal justice reform, stretched police resources, and changing sentencing guidelines. The problem is further exacerbated by the involvement of sophisticated local, national, and transnational criminal organizations that target not only retail stores but also the entire supply chain.
ORC on the supply chain starts at port loading docks, off ships, on trucks, and through container thefts on the railways and highways. The problem is persistent, spans supply chains, and hits retailers in their stores with acts of violence. People are being killed.