Dive Brief:

• Organized crime accounts for some $30 billion of retail shrink, and more retailers than ever are reporting they’ve had to combat the problem, according to the National Retail Federation’s 11th annual Organized Retail Crime Survey. This year’s survey includes responses from executives from department/big-box stores, discount, drug, grocery, restaurant, and specialty retailers. 

• Nearly all (97%) say they’ve been victimized by organized crime theft, up from 88.2% last year, according to the NRF’s survey of 67 senior retail loss prevention executives.

• More states are also battling the problem; 30 now have laws on the books dealing specifically with organized retail crime gangs, according to the report.

Dive Insight:

Retailers are noticing the increased support on the federal and state level to address the problem of organized retail crime. Some 15.4% say they’ve seen more federal law enforcement efforts, up from 9.6% last year. Meanwhile, 43.1% have seen more support from local and county officials, and 24.6% have seen more support from the state level.

The increase in organized crime in retail is making federal law enforcement more important than ever because the crimes very often cross state lines, with complex fencing operations with locations that are sometimes hard to pin down. And generous return policies that attract customer loyalty also attract thieves; two-thirds (66.7%) of respondents say thieves are returning stolen merchandise for store credit, and then selling that merchandise credit to secondary market buyers or sellers.

In addition to a boost in law enforcement, retail companies themselves are beefing up their own efforts, according to the report. Nearly half (47%) are allocating more resources to the problem, up from 41.3% last year. That has meant a 31.8% in dedicated staff, up from 22.7% last year.

More companies are investing in tools and resources to combat the growing problem. Overall, 47% of those surveyed say they are allocating additional resources of some kind, up from 41.3% last year. Specifically, the survey found 31.8% of retailers are allocating additional resources to staffing, up from 22.7% last year, and nearly one-quarter (24.2%) are adding additional budget resources.

That’s probably because the appreciation of the scale of the problem is more often coming from the top: 62.7% of those surveyed said that senior leaders in their companies understand the severity and complexity of the issue, up from 60.5% last year. 

But all this additional understanding and even the stepped-up resources aren’t quite enough yet, the NRF says.

“Even with state-of-the-art technology available, trained employees on the ready, extensive partnerships with all levels of law enforcement and additional resources on hand, retailers continue to grapple with the challenges that come with fighting organized retail crime,” NRF loss prevention VP Bob Moraca said in a statement. “Brazen and often dangerous criminals are finding new ways every day to manipulate the retail supply chain; from the docks where merchandise comes in to criminal flash mobs that involve several individuals running into a store at once, the methods used by crime gangs today run the gamut. These new criminal methods are making it even more crucial for retailers and law enforcement to work together to combat this crime.”