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Organized Retail Crime (ORC) on the Rise

18 Jun

Two trusted bodies recently released surveys that show the serious extent of organized retail crime in the U.S. Organized retail crime is on the rise in the country and retailers should take preventive measures. It is also important for the lawmakers to take decisive actions.

Hayes International published its “24th Annual Retail Theft Survey” showing that over a million dishonest employees and shop lifters were arrested in 2011, leading to the recovery of over $161 million. The survey involved 24 large retail groups whose sales exceeded $589 billion. Hayes International provides consulting services on shrinkage control and loss prevention.

Within the past decade, apprehensions and recovered dollars have risen in eight years. According to the survey, a rise in organized retail crime plays an important part in increasing shoplifting activities.

The National Retail Federation’s eighth annual organized retail crime survey also showed how prevalent the situation is. The federation surveyed 125 retail companies, 96 percent of which had fallen victim to ORC within the past year. The results showed a rise from the previous year when 94.5 percent of respondents had experienced ORC. Over 87 percent of those surveyed believed shoplifting had risen within the last three years.

The survey revealed that the criminals involved in organized retail crime tended to target such high-end electronics as cell phones, laptops and televisions. However, retailers should safeguard against shoplifting of almost all products, including small, lower cost items, for example: pregnancy tests, diabetic testing strips, kitchen aid mixers and energy drinks.

Organized retail crime involves multiple operatives who cover large areas in the regions where they operate. They move from one store to another in a stretch of interstate and steal so many products that they sometimes rent storage units. They later sell the stolen merchandise at flea markets or online.

Preventive Measures

Retailers should take measures to avoid falling victim to organized retail crime, including:

  • Having good sight lines on sales floors. It is particularly important to have clear view of popular and high-value items, which should preferably be kept close to employee work areas.
  • Keeping organized and neat displays to make it easy to see missing items.
  • Limiting easily pilferable and high-value items on the sales floor. Apart from making it easy to notice any missing items, this will also avoid the risk of large losses.
  • Using appropriate technology, including ink/dye tags, CCTV, merchandise alarms and electronic article surveillance.

A growing trend is the use of cameras that integrate point of sale software and loss prevention hardware, which also helps to deal with insider fraud. For example, the camera makes a record when a cashier with “no sale” transaction opens the cash draw.

All retailers must not assume they are immune to organized retail crime. They must take suitable measures right from the hiring stage to the installation of appropriate security systems.

Image by Mubina H and licensed through Creative Commons.

Michael Gardner is a sales rep at CardPrinter.com, an online retailer of Fargo plastic badge printers and identification systems. To learn more about Fargo printers including the DTC4500 visit: http://www.cardprinter.com/products/dtc4500-duplex-ID-card-printer.

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