Retail chains are taking steps to fight theft. This professor compares some measures to redlining
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It’s not hard to find headlines about organized retail theft — and shoplifting in general — from stores around the country.
It’s also not hard to find retailers responding to that theft, be it with more items getting locked up, or more surveillance and other security in shops.
To get a sense of what’s actually happening inside stores, The Show talked to Kathleen Kennedy, an associate professor of practice in the Norton School of Human Ecology at University of Arizona, a faculty member in the Retailing and Consumer Science Program and a former retail executive.
Interview highlights
MARK BRODIE: Kathleen, let’s start with retailers putting more items under lock and key. Is this something you’re seeing more of?
KATHLEEN KENNEDY: That’s one of the responses the retailers are reporting that they’re doing. And particularly in response to trying to get retail losses, retail shrinkage down.
So they’re doing a number of things. It’s not the top thing that they’re doing, but it is something that’s very noticeable to shoppers.
BRODIE: What would you say is the top or are the top couple of things that they’re doing?
KENNEDY: Let’s start out with the fact this is what retailers report, that they don’t have any obligation to talk about everything.
And so the first thing they’re doing is in some locations they’re cutting back on store hours. So late night hours tend in many retail locations to be higher crime periods at higher levels of of shoplifting. So that’s the most common thing. And about half of all retailers report that they’re shifting store hours.
The second thing they’re doing, not locking inventory up but taking inventory out of particular stores. And that’s happening in some unusual ways, which is, one high theft item, for example, is Tide laundry detergent. So in some stores, grocery retailers are replacing the product that people are stealing — Tide — with just having store brand.
The final thing they’re doing — and this is happening in isolated places, and only in certain markets — they may close. Retail chains, large change may be closing one or two more stores than normal.
BRODIE: When you talk about certain stores maybe having certain products removed or things like that, hours shifted — are we typically seeing that in the “bad” neighborhoods or “bad” parts of town? Wow are retailers deciding where they’re going to be doing those things?
KENNEDY: First of all, my experience with retailers and what retailers report is they’re very practical, pragmatic. It’s a financial decision. Where are we making money? Where are we not making money? So it’s usually straight on the numbers.
The challenge with what we’re talking about, which is retail shrinkage, is that it comes from three different things. Retailers absolutely know how many and how much value of inventory is missing.
What they don’t know is how much of that is due to shoplifting. How much of the internal theft? How much of that is due to, organized crime, which has gotten a lot of publicity lately? But how much is due to that?
Those those three things fall into the category of larceny, crime.
And the last category is there’s not great tracking in some retail businesses, losses due to damage, administrative errors, other factors. And in retail to do with perishable goods, you can have a situation where maybe there’s not good tracking on food loss and produce department.
Only a very small percentage of retail theft — whether it’s internal theft, shoplifting or organized crime related — is observed. So all the reports that we see are typically based on estimates.
BRODIE: Well, and we’ve seen so much attention paid to shoplifting especially, organized retail theft. Like how big of a deal is that actually?
KENNEDY: Well, all of this is a big deal to retailers because it’s expensive. How much of this organized theft got overexaggerated in one retail survey from the National Retail Federation, who does an annual survey on retail laws simultaneously in certain cities and locations. There’s 20 to 30 of these locations in the US.
There has been a rise in noticeable — you know, where there would be camera videotape of smash and grabs in a store — or there have been some major crime rings that have been caught and prosecuted.
But if you look at the statistics for this, the according to the FBI, there’s not been an increase in larceny. Retail larceny is where this all fits together. And there’s no sign that this is a national trend. But in certain locations, it’s a significant trend.
BRODIE: When you talk about just sort of shoplifting — run-of-the-mill shoplifting, I guess, for lack of a better word — how much of that is due to self-checkouts that that stores have put in in an effort to maybe save some money?
KENNEDY: Retailers claim that it’s about a third of a third of the shoplifting, is happening, self-checkout. And certain locations are getting new surveillance cameras put in place that remind shoppers if they don’t scan an item. And this is a needed adjustment. Other retail chains are adding people to check receipts when you leave a store.
BRODIE: So you mentioned that retailers tend to be very pragmatic in the decisions that they make. And I’m wondering, when they’re deciding whether to take certain items off the shelves or lock up certain items or increase surveillance, is there a concern that they’re doing that sort of thing in areas where particular populations might be targeted or feel targeted because of those kinds of things that retailers are doing?
KENNEDY: Well, I can only speak to my own concerns on this. I believe we have a form of redlining happening in retail. … And by redlining, I mean geographic areas, store trade areas that are being treated differently because of the demographics of that service area. Product categories that appeal to particular shoppers that may be locked up because of who they appeal to and a guess that they’re going to be high theft categories. Once they’re locked up, they’re no longer high theft categories.
So I give you a simple example. I think that young shoppers, teens and young adults products that appeal to them more likely are going to be locked up. So you can see some biases in what’s going on.
What is difficult to prove as an outsider or a researcher is, is this fair or unfair? If I can say that. Is this being done based upon what’s happening with that specific product, or is it being done in a way that probably is not best for society, meaning this product will appeal to this type of shopper and therefore this type of shopper tends to be a shoplifter? Therefore, we’re going to lock it up.
And we did see a documented case of this with Black hair care products. I think as a society, we should probably look at some of the things that are happening in terms of retail operations that are equivalent to restrictions that happened in banking with redlining mortgages.
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