ICYMI: Curbing Theft Post COVID

Maureen Holohan was excited to go back to physical stores after the pandemic threat reduced, as she wanted to easily compare prices and check ingredients of beauty and health products for her and her children. However, this was short-lived as retailers like CVS and Target started locking up items like deodorant and laundry detergent to prevent theft. As a result, Holohan returned to shopping online or visiting stores where she wouldn't have to wait for someone to retrieve products. This locking of items has become a common practice across the retail industry to stop theft, but it may be turning off customers. Rite Aid is even considering putting all its products behind showcases and using off-duty police officers to guard the stores. But these measures may be too extreme and are causing frustration for shoppers like Sheila Schlegel, who feels that customer service has declined and clerks are overworked.

The increased security measures taken by retailers to reduce theft may have a negative impact on consumers of color, who may feel overpoliced and unwanted. Retail chains like CVS, Sephora, and Walmart made efforts to avoid racially biased practices, such as locking up products only for Black customers, after the murder of George Floyd in 2020. However, the current measures risk undoing these efforts.

According to Tiffany Gill, an expert in African American Women's History, fashion, and beauty culture, "whenever there is a push towards greater criminalization and narratives of increased crime, it is always consumers of color that bear the brunt." CVS Health Corporation and Sephora declined to comment, while Walmart stated that their stance on not locking up beauty products for women of color remains unchanged. Target confirmed that they are locking up more products, but instead of targeting specific items, they lock up entire categories.

The extent of money lost by retailers due to organized retail crime is unknown and it is unclear if the problem has significantly increased. However, the issue has gained more attention in recent years due to high-profile retail thefts and flash mob robberies that received national media coverage. The National Retail Federation, the largest retail trade group in the country, reported that its recent security survey of 60 retailers showed an average inventory loss rate of 1.4% last year, resulting in losses of $94.5 billion. The majority of the loss, 37%, was due to external theft, including organized shoplifting. The survey also revealed a 26.5% increase in organized theft incidents last year.

However, the solution of locking up items to deter theft may actually result in decreased sales, according to Joe Budano, CEO of Indyme, a technology company that provides security devices to retailers. He estimates sales could drop by 15-25% due to the locking of items. John Catsimatidis, owner of New York supermarket chains Gristedes and D’Agostino’s, has locked up more products such as aspirin and deodorant in the past year, but not as many as other drug store chains. He has also increased the number of security guards at some stores. While this may have resulted in some lost sales from impulse shopping, Catsimatidis believes that the added security has made shoppers feel more comfortable and has helped reduce theft, though he can't quantify the amount. He stated that it is not an exact science.

Store workers are struggling to carry out their jobs while monitoring theft. PetSmart manager, Isabela Burrows, noted that her store has had to lock up more items, but this has resulted in customer annoyance. Walgreens recognized that it may have taken its security measures too far, and wants to reduce them - although it acknowledges that retail theft remains a significant problem.

To address theft, some retailers are looking for less intrusive solutions. For instance, Lowe's is testing technology that activates power tools only when purchased, avoiding the need for locking them up. Nexite, a company that creates small Bluetooth tags, is working with retailers in the US and elsewhere to monitor inventory without locking up products. Indyme's Freedom Case requires customers to provide their phone number in exchange for a four-digit code to unlock the case. If the customer exhibits normal shopping behavior, they will retain self-service privileges. However, if they display suspicious behavior, store workers will be alerted to provide assistance. Some customers, such as Holohan, find such measures invasive and prefer not to give out their phone number.