Organized retail crime (ORC) is a growing concern for retailers of all sizes. Groups of professional thieves are systematically targeting retail establishments to steal easily resold merchandise such as pharmaceuticals, groceries, diapers and beauty supplies. The value of each hit is intentionally kept small enough to avoid attracting attention from law enforcement, but add it all up and the cost to the industry is enormous.
According to the most recent National Retail Security Survey, shrink is now a $100 billion problem. The annual survey of retail loss prevention experts found that almost nine out of 10 participating retailers reported an increase in overall risk for their company, with fraud increasing both in-store and online. In 2021, respondents saw a 27% increase in organized retail theft incidents. Eight in 10 of those affected reported an increase in violence and aggression associated with these crimes.
Keeping Staff, Customers, and Bystanders Safe
In a growing number of jurisdictions, lawmakers are directing police officers to focus resources on violent crime. As a result, in many cities officers do not respond to calls about petty theft below a certain dollar amount. Criminals know this and see ORC theft as low-risk and high-reward, so more thieves are coordinating brazen thefts of goods from store shelves that can easily be resold online. Even though they don’t expect much resistance, they are typically prepared to use force if necessary.
Most retail chains direct employees not to intervene in an ORC event unless specifically designated to do so because of the potential for violence. Usually only a loss prevention team member, security guard or someone specifically trained and designated to stop criminal activity would attempt to stop such a crime in the act.
How are retailers protecting their employees, customers and merchandise against these kinds of threats? Many are investing big-time in security, locking up valuable merchandise and hiring more security guards in stores. Some large chains are also developing sophisticated security operations centers with dedicated teams to gather evidence on ORC ringleaders so prosecutors can put together a stronger case.
In addition to establishing standard operating procedures that focus on minimizing the potential harm to customers, employees and bystanders, retailers can also install practical physical security solutions and train staff to take meaningful action to reduce losses and help investigators.
For example, more stores are installing panic buttons to make it easier and quicker for staff to notify a Security Operations Center (SOC) that a crime is in progress, so they can monitor what’s happening via video and determine how to respond. In jurisdictions where police may not respond to small-scale retail crime, they will respond to violence. If the SOC staff see that the situation escalates and the criminals become violent, they can call 911 to get help. They can also share the video evidence with law enforcement in real time or after the fact to build a case.
Another helpful tool is automatic license plate recognition (ALPR). This can help identify vehicles involved in a robbery, which can be useful when the same vehicle is used in more than one attack. The SOC can program an alert to come in when a suspicious vehicle enters the parking lot or parks in front of a store. Modern ALPR tools not only read license plates but can also identify vehicles by make, model and color. If a white truck has just been involved in an ORC incident, connected systems can alert SOC teams if a matching vehicle is spotted on camera.
ALPR technology has become not only more powerful but also less expensive and easier to install. The latest innovations include wireless, solar-powered cameras that can be installed almost anywhere, at a fraction of the cost of the older tech. This allows retailers to expand the surveillance perimeter beyond the front door. If a vehicle enters the perimeter that has been linked to previous criminal activity, the SOC can keep an eye on what happens from the safety of the command center.
Collaboration is Key
Curbing the ORC threat requires a coordinated effort. It’s not something any one store can do alone. The key is to build a bigger case. Large retail chains are already compiling and sharing data on ORC crime within their store networks. By next year, we’ll begin see collaborative databases allowing independent businesses or chains to opt in to share alerts about suspicious vehicles that come in via ALPR.
In isolation, each incident may be relatively small, but the impact adds up. Law enforcement, district attorneys and retail investigators need to band together to gather evidence and strengthen cases brought against the gang leaders who mobilize people to steal and resell products.
For example, at the beginning of this year, 29 people were arrested in a multi-state ORC theft ring that cost stores more than $10 million in losses over a period of less than four years. Each time the gang hit, they stole products worth a few thousand dollars or less, which made it easier to fly under the radar — for a while.
Investigators say one person was leading the operation, hiring people to steal goods and others to sell them through well-known ecommerce sites. She even paid for travel expenses so her gang could steal from stores in other states, and also paid to bail her people out of jail promptly so that they wouldn’t talk to police. Cracking this case was possible only because the retailers that were affected were able to collect and share evidence to prove that the problem was much bigger than the loss of a few cartloads of allergy medication or tooth whitener.
Your physical security technology can play a critical role in this. With video analytics such as ALPR and facial recognition, you may be able to provide information to help identify repeat offenders. Video surveillance footage may also help you get a rough estimate of how much has been stolen so that you can quantify losses.
Modern evidence-sharing platforms also include privacy tools like facial masking to hide the identities of anyone caught on camera who is not a person of interest in the investigation. That way you can protect the privacy of your employees and customers. Some security software platforms also include sophisticated tools to tag, search and visualize data so you can more easily identify trends or clues that may help the investigation.
An Ongoing Concern for Retailers
Organized retail theft affects us all. In addition to losses and trauma experienced by those who are directly affected, when ORC gangs walk out with shopping carts full of stolen goods it can lead to product shortages for others who want or need those items. Retailers may also need to increase prices to cover the cost of the lost product and any damage.
The problem will continue as long as thieves believe they can get away with it and make a profit. Let’s not make it easy for them. Retailers can mitigate the risk of ORC to staff, customers and profitability by investing in security enhancements, process improvements and training. Collaborating on investigations, gathering and sharing evidence, and dedicating resources to unmasking repeat offenders will also help fight back against this trend.
Scott Thomas is National Director of Sales, Signature Brands, at Genetec. He and his team are responsible for sales to the retail, financial, hospitality, gaming and cannabis vertical markets via Genetec’s network of system integration partners. Thomas is a member of the Rolling Stones Culture Council and the Loss Prevention Magazine Advisory Board.