WASHINGTON – A decade has passed since the National Retail Federation (NRF) first surveyed its community of loss prevention and security executives about the impact organized retail crime has on their companies, and with the release of the 2014 survey, it’s evident that the $30 billion a year problem still threatens retailers of all sizes throughout the country.
According to the NRF’s 10th annual Organized Retail Crime Survey, eight in 10 (88.2%) retailers report that they have been a victim of organized retail crime (ORC) in the past year, down slightly from 93.5% last year. Although retail stores take most of the brunt of ORC activity, criminals are now finding ways to manipulate retailers’ online operations. For the first time, NRF asked about the impact organized retail crime has on their online operations: and nearly half (48.3%) say their online operations are affected.
“Few retail crimes reach the level of concern among retailers that organized retail crime does,” said Rich Mellor, NFR senior advisor for asset protection, in a press release. “For the better part of 15 years, savvy criminals and the enterprises they’re a part of have forced retailers to change how they deal with fraud, including maximizing efforts to partner with and educate law enforcement.”
Retailers are now investing more in combating organized retail crime. Overall, three-quarters (74.7%) of those surveyed say they are allocating resources. When asked about their company’s overall ORC case value for the past 12 months, 13.2% of retailers estimate the value to be more than $5 million; the average case value for those who have lost money to organized retail crime is $2.8 million.
As of May 2014, 25 states have enacted laws against criminals who are found to be associated with an organized retail crime gang, a significant feat that states and retailers have worked diligently on for more than 10 years. Because organized retail crime gangs have the means to transport stolen products through multiple states and even overseas, the need for federal legislation is greater than ever.
“We commend the retailers and states who have dedicated significant attention and resources to put retail crime laws in place, and we are hopeful that these state laws will lead to even greater success with prosecuting retail crime gangs in the future,” said Jon Gold, NRF vice president. “And while state laws are putting a dent in the level of ORC cases each year, we believe federal ORC legislation is still needed to help support the effective efforts at the state level since the criminals tend to operate across multiple states.”