According to the National Retail Federation's organized retail crime study, 97% of retailers have experienced organized retail crime in the past year and 68% have seen an increase in organized retail theft. Out of the retailers who had experienced organized theft, retailers' lost $703,320 for every $1 billion in sales on average, which is the fourth year in a row that their losses were more than $700,000, according to the report.
Sixty-five percent of retail respondents said that organized retail crime is a higher priority compared to five years ago, per the report. The study also found 56% said they were setting aside more technological resources to the issue and 44% will bump up their loss prevention spending.
According to the report, 73% of retailers have lost merchandise due to cargo theft, followed by 59% of theft that occurred on the way to distribution centers. The report also found that stolen goods are sometimes returned for store credit, typically for gift cards, and 51% of retailers have found those gift cards for sale online.
Shrinkage remains a significant problem across the retail sector. Last year, another National Retail Federation report estimated that shrinkage totaled $50.6 billion and that robberies were the top cause, followed by employee theft, shoplifting and organized retail crime.
Per the NRF's organized retail theft report, 38% of retailers had changed or were planning to change return policies and 37% were revising their point-of-sale policies. Meanwhile, 27% were reviewing their employee screening practices and 24% the way they address trespassing, the report indicated.
To combat that, some firms are developing technology to help reduce shrinkage. Back in June, Kenco Label & Tag Co. and Primera Technology debuted a new Kenco-LP tag to assist retailers in tracking products across inventory and returns processes, preventing employee and shopper theft, changing prices and spotting fraudulent returns without damaging garments.
"Organized retail crime continues to present a serious challenge to the retail industry," NRF Vice President of Loss Prevention Bob Moraca said in a statement. "These criminal gangs are sophisticated, but so are retail loss prevention teams. Retailers are committing more resources and constantly evolving their tactics to fight this ongoing challenge."