In a May earnings report, Brian Cornell, CEO of Target, said that a loss of inventory is expected to reduce the company’s profits by more than $500 million compared to the previous year. While he said there were “many potential sources,” theft and organized retail crime were becoming “increasingly important drivers.”
The corporate disclosure was a rare public recognition of the already large and increasing issue that theft is posing for retailers since the coronavirus pandemic. Industry insiders say that Target’s figure is just the tip of the iceberg, and that shrink—a word for inventory loss—many chain stores were experiencing was largely attributable to retail crime.
While one might think that the issue had arisen due to inflationary pressures pushing more people to shoplift, experts say that petty theft usually accounted for a small proportion of inventory loss. Large sums were being lost through organized retail crime (ORC)—something every consumer has likely experienced the effects of.
They portrayed a vicious cycle in which the pandemic had turbocharged a move towards online shopping, which itself incentivized a greater amount of retail crime, but that retail crime was now also incentivizing more consumers to shop online.
Read more at Newsweek.com
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