A growing number of U.S. retailers are ringing alarm bells on organized looting that is gripping many major urban markets across the country.
"Across retail, we are definitely seeing more and more particularly organized retail crime," Best Buy CEO Corie Barry said on a quarterly earnings conference call with Wall Street analysts.
Barry noted that the retailer was determining how to "lock up" products while also ensuring "a good customer experience." The Best Buy chief executive confirmed that some store locations had hired security guards.
"What I would really stress here is, for our employees, these are really traumatic experiences. Obviously, their safety is our first priority," she said.
"They are happening more and more across the country. It's really been a horrible change in the trajectory of the business, and one we are working hard to try and stem."
Organized Looting Hurting US Retail Industry
A wide variety of brick-and-mortar retailers across the country are seeing a significant jump in shoplifting.The Coalition of Law Enforcement and Retail recently predicted that organized retail theft has cost companies approximately $45 billion in annual losses, up 50 percent from a decade ago.
In addition to smash-and-grab efforts, criminals are changing their tactics, too.
Gail Morris, director of investigations at Williams-Sonoma, Inc., noted that culprits return stolen goods without receipts and claim it was a gift. But that is not the scheme they are employing.
“They try to socially engineer care center people on the phone. They may say they have something that doesn’t work and return a box of rocks because we just look at the tracking number,” Morris stated. “It’s a scheme that has been around for years, but it’s easier to get away with because businesses are heavily focused on their ecommerce channels.”
Americans Concerned About ‘Porch Pirates’
It is estimated that 92 percent of Americans will receive a package delivered for Christmas. But this generosity and convenience may also cause some concern amid the rise of “porch pirates.”The annual report noted that 23 percent have had a package stolen. Still, this has not deterred consumers, as 28 percent report they plan on doing more online shopping this Christmas.
Many are also taking the necessary precautions to avoid becoming victims of theft. Twenty-seven percent are sending their deliveries to work or a relative's house, while 40 percent have installed a doorbell camera or motion lights.
Consumers Pay Higher Prices
In the end, it is the customer’s pocketbook that bears the cost. The issue of organized looting forces retailers to pass the cost of lost goods onto the customers, industry experts say.When the consumer price index (CPI) is at a more than 30-year high of 6.2 percent, this is something that shoppers cannot afford. In the meantime, more consumers are changing their shopping habits, whether frequenting stores in the daytime or heading online.