How Organized Retail Crime is Threatening the Retail Industry

Generally defined as "the coordinated theft of merchandise by two or more individuals for the purpose of reselling for financial gain," Organized Retail Crime (ORC) has consistently grown as a problem over the past decade and is projected to become even more of an issue in future years.

ORC costs retail businesses an average of $244,509 per case, the highest the case value has been in over 8 years. The same federation report cited that theft has continued to grow year by year since 2020, with a 3.7% increase from 2022 to 2023. In October 2023, Target announced it was closing 9 stores across 4 states due to organized retail crime. Walmart has closed over 24 stores in 14 different states throughout 2023 due to theft and underperformance.

The impact this crime is having on retailers everywhere means ORC isn’t something that can simply be ignored. Modern, tactical security solutions are needed to help retail businesses, both large and small, collaborate with law enforcement to stop organized retail crime, while still providing a safe and enjoyable shopping experience for customers. It’s not an easy problem to solve, but cloud video security systems may be the answer.

Understanding Organized Retail Crime

While Organized Retail Crime is presenting a notable problem for many retailers throughout the U.S., measuring the extent of the problem has provided some discussion-worthy challenges. ORC, while in previous years described as a clearly definable problem for retailers, has turned out to be far more conditional and nuanced. Definitions for ORC, while available, still lack consistency across state legislation. In certain cases, crimes categorized as ORC could be more accurately defined as cargo or employee theft.

Because of the nuanced nature of this type of theft, data surrounding ORC has shifted due to limited reporting and occasional erroneous claims made in the past. The National Retail Federation and major corporations have attempted to clarify discrepancies in reporting as the crime is more deeply studied. Due to the newness of studies surrounding ORC, it’s critical that retail businesses, both large and small, analyze the available facts and their conditions before determining the security solutions that may work best within the scale of their organization.

Finally, ORC is thought to have many of its incidents go unreported. This lack of reporting, as well as underground criminal networks concealing their activities that would otherwise be linked to ORC, add additional layers of difficulty when attempting to understand the full scope of the crime.

Read on to learn more about the impact ORC is having on today’s economic landscape, as well as how cloud video security can assist retailers’ loss prevention efforts and streamline investigations.
 

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New Report Shows Surge in Retail Violence
Warning signs for the holiday shopping season?

Violence in brick-and-mortar retail surges, threatening retention of staff ahead of the holiday shopping season, new research from LPRC & Verkada finds
More than half (52%) of retail workers say they are likely to leave their current job in the next 12 months due to personal safety concerns, according to new research conducted by the Loss Prevention Research Council (LPRC) and in partnership with Verkada.

The State of Retail Safety report reveals an alarming escalation in workplace violence from 2024, and offers critical insight into solutions that can protect retail workers, consumers and inventory without escalating tensions. Key findings include:

Safety concerns on-the-job escalate, corresponding with material increase in reports of violence: More than one in three (35%) retail workers reported feeling unsafe at work, up from 27% in 2024. Reports of physical assault increased 22% year-over-year, while aggressive behavior from past employees and current coworkers jumped 28% and 26%, respectively. Nearly 40% of workers worry about theft and verbal harassment most or every time they go to work.

Violence threatens retention in an industry that already faces high turnover: One in four retail workers (25%) report they've thought about looking for a new job due to personal safety concerns, up from 19% last year. Those who experienced violent incidents are even more likely to leave: 53% say they have considered new opportunities. Men, who are experiencing workplace violence at notably higher rates than women, are also significantly more likely to quit over safety concerns in the next year (63% vs. 39% of women). Store managers are feeling the impact of this retention challenge: nearly half (49%) report that safety concerns are a barrier to hiring, up significantly from 37% in 2024.

Locked cabinets create friction on both sides of the counter: Nearly half (46%) of retail workers say physical theft prevention tools like locked cabinets and checkout gates are more disruptive than effective, and 59% report they reduce their efficiency on-the-job. Customers agree: 60% of U.S. adults say physical theft prevention tools are more disruptive to the shopping experience than they are effective at deterring crime, and 74% say certain theft-prevention measures make them less likely to shop in-store. Retail workers in stores with these measures in place report higher rates of violence across every category measured, revealing an uncomfortable reality: customer frustration from these barriers may be fueling confrontations, as retail workers report 54% of verbal threats stem from angry customers.  prnewswire.com


End-of-Year Industry Push for Federal ORC Legislation
Retailers push anti-theft legislation before 2025 ends

The Retail Industry Leaders Association, National Retail Federation and several major chains Tuesday urged Congressional leaders of both parties to pass a bill addressing organized retail crime.

As the year winds down, retailers are drawing attention to anti-theft legislation that has languished in Congress for years. The bill has always enjoyed bipartisan support.

Industry groups including the Retail Industry Leaders Association and National Retail Federation plus major retail chains on Tuesday sent a letter to Congressional leaders in both parties urging the passage of the Combating Organized Retail Crime Act. Walmart is not on the list of signatories; the retail giant didn’t immediately respond to comment on why.

In previous years the industry focused on in-store theft and shrink, but that has changed somewhat. Safety concerns, online fraud and cargo theft, in addition to in-store theft, are now more in focus. Retailers’ top concerns are organized retail crime, shoplifting, repeat offenders, phone scams, return fraud and credit card-related theft, according an NRF crime report last month.

“This is about more than theft — it’s about safeguarding the people and systems that keep our economy moving,” RILA’s senior director of government affairs, Sarah Gilmore, said in a statement Tuesday. “CORCA ensures law enforcement has the resources to dismantle organized crime while helping businesses protect employees, customers, and the integrity of the supply chain.”

The anti-organized crime bill would expand federal enforcement of criminal offenses related to organized retail crime and of the scope of conduct that qualifies as an offenses; latitude for prosecutors under federal money-laundering statutes; and the establishment of an Organized Retail Crime Coordination Center where law enforcement could better coordinate.  retaildive.com


NY's Crackdown on Retail Theft:
Governor Hochul Announces New York State Police Organized Retail Theft Task Force Has Recovered More Than $2.6 Million in Stolen Goods

Retail Theft Decreased More Than 13 Percent Year-Over-Year in New York City, Larceny Down 13 Percent Across the Rest of the State

Governor Hochul today announced that the New York State Police Organized Retail Theft Task Force has recovered more than $2.6 million in stolen goods statewide since launching new initiatives to curb retail theft in April 2024. Across 1,006 operations, State Police and local law enforcement partners have made 1,224 arrests and filed 2,146 charges. This concerted, joint effort to tackle the pandemic-era surge in thefts has contributed to a 13.6 percent decrease in retail theft year-over-year in New York City and a 13 percent decrease in larceny outside of New York City from January through June of this year as compared to the same time last year.

Following a post-pandemic spike in reported retail theft in New York City and a statewide surge in reported larcenies, Governor Hochul invested more than $40 million in District Attorneys’ offices, local law enforcement, and retail theft teams within the State Police staffed by 100 dedicated Troopers. She also advanced new initiatives to strengthen laws, hold perpetrators accountable, protect retail workers and support small businesses, including:

• Elevating the assault of a retail worker from a misdemeanor to a felony, ensuring any person who causes physical injury to a retail worker performing their job is subject to enhanced criminal penalties.

• Allowing prosecutors to combine the value of stolen goods when filing larceny charges, and allowing retail goods from different stores to be aggregated for the purposes of reaching a higher larceny threshold when stolen under the same criminal scheme.

• Making it illegal to foster the sale of stolen goods to go after third-party sellers.

• Securing $5 million to fund tax credits to help small businesses invest in and alleviate the financial burden for added security measures.

The most recent crime data reported by the New York City Police Department show year-over-year decreases in several crime categories, including a 3 percent decrease in overall crime complaints, 20.5 percent decline in murders, 23.2 percent drop in shooting incidents, and 9.5 percent decrease in robbery. governor.ny.gov


Prop 36's Retail Crime Impact
Placer County announces new retail theft strategy ahead of the holiday season
The county's district attorney's office is holding a news conference on Wednesday to highlight its Retail Theft Initiative program and what it has achieved since the voter-approved Proposition 36 — a statewide measure allowing for harsher penalties for theft crimes — went into effect nearly a year ago.

The program involves a collaborative partnership among prosecutors, local chambers of commerce, law enforcement agencies and business leaders across Placer County, the district attorney's office said.

Prosecutors say a new data forensic strategy is being used by the program and that Placer County has taken on statewide cases from larger county counterparts. kcra.com


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