Retail theft increases as lockdown effects linger


For those older enough to remember, you may find it rather bewildering when reflecting on the carefree 1980s and what has occurred globally over the last 21 months. Few have escaped the financial and mental impact that extended, and reoccurring lockdowns have had on individuals to safeguard community health.
Small businesses in the hospitality and retail sectors have endured the brunt of the blow–with retail stores experiencing lower revenues and substantial increases in costs and retail theft.
In our discussion today, we look at the plight of retailers battling on numerous fronts to stay afloat during these challenging times. We discuss the impacts of lockdowns, non-essential store closures, reduced business, government compliance requirements and an old-foe—shoplifting.
Finally, we take a look at several preventative and proactive strategies store owners can implement to help battle retail crime and lower shrinkage—let’s get started.


Retail profitability drops while lockdown shoplifting spree rages.

Lockdowns have been tough, and since March 2020, people everywhere have been forced to hunker down and go without access to regular, everyday goods and services.  

The effects of restrictions are staggering. In Massachusetts alone, Metro West Daily News reports, the impact on the local economy calculated at $1 billion— a massive 69% increase in shoplifting. Thieves are getting smarter, more daring and violent. 

Initial figures revealing the cost of the various lockdown stages have been staggering, with a 2021 Forbes report estimating the cost to the global economy at $24 trillion. The impact goes beyond the mounting global debt pile, unemployment, the rising cost of living, tyrannical lockdowns, social breakdown and supply chain disruptions—all of which have taken their toll on the global community—understandably, none of which are good news for business.

While customers are doing without—they are saving, and this is where the economics of the pandemic gets interesting. For some, the pandemic has meant an immediate loss of income, while others transitioned to working from home. Retail outlets deemed non-essential were required to close.

The impacts directly attributable to the pandemic and subsequent lockdowns are:

  • Total or partial loss of business revenue
  • Employee layoffs
  • Reduced stock availability
  • Transportation issues
  • Insufficient income to cover costs
  • Increase customer and staff anxiety
  • Mental illness
  • A notable rise in retail crime

As the message of the pandemic changes and the way of life shifts back to a new normal, shoppers are once again returning only to find the retail landscape has undergone a significant and permanent change.

Post-pandemic, retailers now face significant new challenges, they are:

  • Reduced customer disposable income
  • Production delays
  • Supply chain issues
  • Smarter, more determined shoplifters
  • Increased compliance requirements
  • Staff shortages

A recent report featured in the LA Times points to the glaring issues that show our supply chain is buckling due to staff shortages and port closures—goods are piling up at the docks while fully laden ships queue outside ports, sometimes for weeks on end. 

Mandates and strike action throughout the supply chain have resulted in considerable delays in parcel deliveries nationally and internationally.


Opportunity or need—why is shoplifting increasing during the pandemic?

With insight into what’s happening behind the scenes, it is easier to understand the socio-economic factors driving the increase in shoplifting and the sophisticated crime syndicates. An interesting study by Western Michigan University pre-pandemic discusses the economic motivators for shoplifting and concluded contributing factors resulted from;

  • Financial hardship—loss of employment or individuals from low-income households
  • Personal stresses—depression or loneliness
  • Psychological—drug use and sexual problems
  • Entitlement—keeping up with the latest trends 

The above findings are reinforced by a recent study by the Frontiers in Psychology which discusses the emotional, psychological and behavioural impact of the COVID-19 pandemic.

While the pandemic has increased the number of individuals experiencing economic hardship, as mentioned earlier, sophisticated crime syndicates are driving retail crime to new levels motivated by opportunity.

Staff reductions both on the frontline—in-store and within the supply chain have provided sophisticated thieves with the opportunity to steal and steal more often and with greater ease.

Most often than not, opportunity seems what drives the increase in retail theft, short and simple—as a result; retailers are struggling to run their business in three critical areas;

  1. Lower monthly turnover
  2. Reduced staff levels
  3. Product availability

Due to a reduction in consumer demand, store owners often feel compelled to reduce staff levels to balance finances to survive. 

However, unfortunately, reducing staff levels further exacerbates the problem with unscrupulous individuals determined to take advantage of overwhelmed sales staff.

Throughout the supply chain, delays in delivery and lost and stolen freight all impact business operations.

US Transportation secretary Pete Buttigieg commented on the national supply-chain breakdown and revealed that supply-chain disruptions will likely continue well into 2022.


Preventative measures to protect your business from retail theft.

Despite the obvious signs the retail sector is under attack from various sources, there are steps you can take to combat shoplifting and protect your business.

  • Invest in smart technology
  • Improve staff awareness
  • Grow your online presence
Smart technology to secure your store.

Fortunately, there are several ways businesses can secure their store—we’ve gone into more detail in a recent article, but we will quickly review some of the strategies for convenience.

  • Install wireless or 4/5G cameras to monitor customers entering and leaving your store
  • Initiate an inventory control system—start barcoding and monitoring stock levels to help better identify where inventory shrinkage occurs.
  • Secure high-value items such as clothing and electronic goods by installing a retail security system and tagging vulnerable items.
  • Parcel tracking and freight insurance—crucial if your business accepts orders online or over the phone.
Combat theft by Improving staff awareness.

Choosing the right employees is more important than ever—here are some things you can do;

  • Background checks—determine whom you hire wisely; poor choices can cost your business dearly.
  • Incentivise staff—make staff more accountable and reward those interested in improving their customer service and sale skills.
  • Implement systems—systemising employee procedures—a checklist of practices at the point of sale helps guard against credit card fraud and human error while promoting awareness and lowering inventory shrinkage.
  • Create a positive work culture—a happy work culture is crucial to the smooth running of your business; happy employees are productive employees and more likely to look after your business interests.


Safeguard your future growth online and lower shrinkage.

Many small businesses neglect their online presence—not realising their website potential to drive new and existing customers back to your store and increase sales.

Here are some simple tips on improving brand awareness;

  • Craft your message—a well-crafted about page to solidify your business message and connect with your audience
  • Focus on benefits—focusing on audience benefits rather than features is more likely to resonate with them and positively impact sales.
  • Keep in touch—regular contact with your customers and loyal audience with weekly emails and informative news will help build better rapport and trust.
  • Invest in growth—build your online audience and lower marketing costs with a content marketing strategy. Finding the right balance is crucial so consider engaging a qualified digital marketing team to help drive your marketing campaign.


Final thoughts

While significant challenges lie ahead for the global economy, supply chains and increased governmental compliance, there are ways businesses can safeguard their future.

By applying the above mentioned and proven strategies, it is possible to guard against attempts by shoplifters and professional criminals to steal your merchandise.

Prevention does have a price—balancing your approach, remaining positive and investing in your businesses future is a sure-fire way to keep your finances healthy and reach your business goals.

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