ALEXANDRIA, Va.—The National Retail Federation has released a report that shows retail crime is up, and more retailers are planning additional investments in security, reports RetailDive.com.
When retailers were surveyed by NRF, just over a third (36%) said they are increasing their loss prevention budget, and 59% are more aware of people returning stolen merchandise for store credit or gift cards and then selling the credit or gift cards on the secondary market.
In 2019, 97% of surveyed retailers said they had experienced organized crime in the past year, and 51% said they’d seen gift cards from the return of stolen goods appear online. That same year, retail shrink reached $61.7 billion, an increase from $50.6 billion in 2018. As a result, one-third of respondents have revised their return policies, 29% have changed their point-of-sale policies and 20% have updated their trespass policies.
According to NRF, organized retail crime costs retailers $719,548 per $1 billion in sales on average, an increase from $703,320 in 2019. In fact, 2020 marks the fifth consecutive year that organized crime has cost retailers more than $700,000 per $1 billion in sales.
The survey also found that more than six in 10 retail respondents think a federal organized retail crime law is needed to address the issue. In the meantime, they’re investing in resources to combat the organized criminals, who target stores, warehouses and cargo.
Cybersecurity also continues to be a headache for the industry, according to the report. Among the most recent major retailers falling victim to cybercrimes was DSW, the shoe store chain, which lost access to its store inventories after a software vendor suffered a ransomware attack in the third quarter. Cybersecurity experts have long warned that third parties like vendors, consultants and suppliers pose serious cybersecurity risks for retailers.
Learn more about protecting stores from data attacks in “Under Siege” in the April 2020 issue of NACS Magazine.