7 ms·

Target expects organized retail crime-fueled losses to jump by $500M this year

29 points by jameslk 3y ago

impish9208 3y ago
Previously posted the actual statement from Target here: https://news.ycombinator.com/item?id=35973619 https://news.ycombinator.com/item?id=35973619
quitit 3y ago
As I watch stores and fast-food outlets switch to store designs which are highly secure to protect workers from violence and product from theft and damage. I wonder if it is changes in societal norms which are forcing retail to catch up. We've had bad areas before, we've had widespread poverty before. What is new are certain normalisations that it's ok to escalate to violence with staff and that damaging property is fair for settling disagreements, disappointments or even normal as seen in various TikToks trends. Are open counters and accessible product going to be something that goes away in retail, or is this just a reaction to rising cost of living expenses? Seems like we're entering an era where retail approximates a midpoint between looking like a bank and a vending machine.
- vorpalhex 3y ago
  > Are open counters and accessible product going to be something that goes away in retail No, expensive areas with private security and access control will still have open racks of merchandise, people walking around to assist you and generally be lovely. Poor areas without those things will look more and more dystopian, be more hostile and generally offer less items and less help. I suspect the automated self checkout will takeoff. One of the reasons to publically fund the police was to remove the market for private security. Once upon a time it wasn't uncommon to hire a spare coachman to "ride shotgun" which meant literally manning a shotgun. I suspect deliveries to these areas may see the "shotgun messengers" return...
  - coffeebeqn 3y ago
    The next step is a robot police next to the self checkout that will grab shoplifters
    - vorpalhex 3y ago
      Solution is easier than that. Charge people $99/year to enter the store. It won't be sold that way. It'll be bundled. You'll pay your fee for free shipping and some music/video access and oh also here are retail stores just for "members".
      - mcphage 3y ago
        Or go back to the old fashioned model of "you tell the clerk what you want, and they fetch it for you". The last store I'm aware of that did that faded away in my lifetime. (Brand Names, although maybe it still exists somewhere). I remember going to Toys-R-Us as a kid, and to purchase video games, you took a ticket off of the wall, and paid for it, and then exchanged the ticket for the actual item at a locked booth near the exit.
        Avshalom 3y ago
        We've been moving back to that. Curbside/instore pickup (and now curbside returns) is a thing at most of the major retailers. It got a big push during pandemic store closures but e.g. Target had been doing it since 2014ish
        mcphage 3y ago
        I didn’t even make that connection, but you’re right—that’s basically the same thing.
      - Avshalom 3y ago
        Costco/Samsclub are already there.
  - houseatrielah 3y ago
- lmm 3y ago
  The future of culture is even harder to predict than other aspects of the future. But for my money we're in for the long haul. Americans no longer feel like they're all part of the same society. Look at countries in colonial Africa where tribal identity is much stronger than national identity for the kind of environment that leads to.
robotnikman 3y ago
I fear that this will give Amazon even more of an advantage over brick and mortar stores.
- bombcar 3y ago
  We have our best men on closing that gap: https://m.youtube.com/watch?v=KM2UzqO33AY https://m.youtube.com/watch?v=KM2UzqO33AY
- add-sub-mul-div 3y ago
  They've laundered the victimhood to their customers.
- cameldrv 3y ago
  Amazon also benefits because that’s where a lot of the stolen merchandise gets fenced. You get a good deal on laundry detergent there because it was stolen from Target.
rahimnathwani 3y ago
Approximate annual figures: $100bn revenue $25bn gross margin $3bn net profit If they could magically eliminate the $1bn of shrinkage, net profit would be 33% higher.
- Kye 3y ago
  This kind of scale requires eliminating the human element. It's harder to steal from or hurt a person. It's easier to steal from a faceless corporation or abuse someone in a position dehumanized by decades of "that's where you'll end up if you don't study hard."
  - rahimnathwani 3y ago
    "It's harder to steal from or hurt a person." I'm not sure. Mom+pop shops suffer from shoplifting (and even armed robberies), even though in many cases the owners are living hand to mouth, and can't really afford the losses. A human can convince themselves of anything (about corporations, about immigrants, about any 'other' group), if it helps them self-justify the actions they want to take.
    - Kye 3y ago
      Harder, not impossible. Though there's probably data out there, and it might show I'm wrong. Maybe it's the same or worse, proportionally.
AndrewKemendo 3y ago
> based on calculations from the company’s financial filings. With the anticipated increase, shrink this year would surpass $1 billion. >It can be difficult to quantify theft, since shrink includes inventory loss from other causes, such as employee theft or damage, too. Based on this story it seems like they could just totally fabricate this number? Surely such numbers would spur a deluge of police reports or at the minimum a wave of insurance claims. Are those signals also present?
- qeternity 3y ago
  Could they fabricate the numbers? Perhaps, although this is what auditors do. More bizarrely is what incentive they would have to artificially reduce their reported earnings? You seems to be suggesting that you know more about Target’s business than Target does, and I have to believe you’ve already come to the conclusion that retail theft hasn’t increased because that’s a social narrative that suits you.
  - lmm 3y ago
    > More bizarrely is what incentive they would have to artificially reduce their reported earnings? The overall shrink number is known and auditable, but they have plenty of incentive to adjust which proportion of shrink they attribute to external theft vs internal theft vs damages if they think one will play better with shareholders than the other. (E.g. external theft is likely to be an industry-wide problem, whereas an increase in internal theft might indicate that Target specifically is struggling to hire high-quality staff)
    - qeternity 3y ago
      RTFA. They haven’t done any of this. The headline is for their shrink number, which they said is fueled by theft. But theft and looting is 10x more difficult to solve than other shrink. It plays worse with investors. If their stores are indeed becoming dangerous, that might also reduce sales from normal customers. All other kinds of shrink they can implement internal processes to reduce. This narrative makes no sense.
  - 3y ago
ortusdux 3y ago
Last I heard, they were famous for their loss prevention. Has this changed, or are other stores worse off?
nahnahg 3y ago
[dead]
abudabi123 3y ago
I have seen a couple barcode scan all the items for one product, wasn't in the department store long enough to see the bigger picture. At a guess, the data would be used to trick the department store's information system at some offset in cyber to collect cheese, maybe to collect faked refund.
chucklenorris 3y ago
Wtf is going on in US? Are poor people that desperate that they consider getting shot for groceries? Especially considering how insane policing in US looks like. I live in a poor country and this is not a problem, not at this rate anyways. There are plenty of self serve stores and there's a big push for self checkout too although people hate it.
- maxerickson 3y ago
  Large retailers don't have armed security. At least, not mostly. Things are still at the point where they are more worried about liability than the stuff getting stolen. The $500 million is less than 1% of their cost of goods. It's an easy place to look for improvements, but it isn't really a threat to their business. I definitely think things have gotten worse. I've directly noticed a couple of thefts at my local Walmart in the last couple of years and hadn't seen any in previous years. In one case I saw a person just push their cart through a self checkout area. In the other, the self checkout I walked up to had an incomplete transaction sitting there.
  - mcphage 3y ago
    Self-checkout seems to remove some of the human connection in shopping—there isn't even a face to the corporation anymore.
- fatnoah 3y ago
  > Are poor people that desperate that they consider getting shot for groceries? The liability and reputational cost of a store security guard injuring a shoplifter, or even getting injured themselves is so high that they might not even be allowed to physically intervene. Naturally, knowledge of this spreads.

29 points by jameslk 3y ago

Previously posted the actual statement from Target here: https://news.ycombinator.com/item?id=35973619 https://news.ycombinator.com/item?id=35973619

quitit 3y ago

As I watch stores and fast-food outlets switch to store designs which are highly secure to protect workers from violence and product from theft and damage. I wonder if it is changes in societal norms which are forcing retail to catch up. We've had bad areas before, we've had widespread poverty before. What is new are certain normalisations that it's ok to escalate to violence with staff and that damaging property is fair for settling disagreements, disappointments or even normal as seen in various TikToks trends. Are open counters and accessible product going to be something that goes away in retail, or is this just a reaction to rising cost of living expenses? Seems like we're entering an era where retail approximates a midpoint between looking like a bank and a vending machine.

vorpalhex 3y ago
> Are open counters and accessible product going to be something that goes away in retail No, expensive areas with private security and access control will still have open racks of merchandise, people walking around to assist you and generally be lovely. Poor areas without those things will look more and more dystopian, be more hostile and generally offer less items and less help. I suspect the automated self checkout will takeoff. One of the reasons to publically fund the police was to remove the market for private security. Once upon a time it wasn't uncommon to hire a spare coachman to "ride shotgun" which meant literally manning a shotgun. I suspect deliveries to these areas may see the "shotgun messengers" return...
- coffeebeqn 3y ago
  The next step is a robot police next to the self checkout that will grab shoplifters
  - vorpalhex 3y ago
    Solution is easier than that. Charge people $99/year to enter the store. It won't be sold that way. It'll be bundled. You'll pay your fee for free shipping and some music/video access and oh also here are retail stores just for "members".
    - mcphage 3y ago
      Or go back to the old fashioned model of "you tell the clerk what you want, and they fetch it for you". The last store I'm aware of that did that faded away in my lifetime. (Brand Names, although maybe it still exists somewhere). I remember going to Toys-R-Us as a kid, and to purchase video games, you took a ticket off of the wall, and paid for it, and then exchanged the ticket for the actual item at a locked booth near the exit.
      - Avshalom 3y ago
        We've been moving back to that. Curbside/instore pickup (and now curbside returns) is a thing at most of the major retailers. It got a big push during pandemic store closures but e.g. Target had been doing it since 2014ish
        mcphage 3y ago
        I didn’t even make that connection, but you’re right—that’s basically the same thing.
    - Avshalom 3y ago
      Costco/Samsclub are already there.
- houseatrielah 3y ago
lmm 3y ago
The future of culture is even harder to predict than other aspects of the future. But for my money we're in for the long haul. Americans no longer feel like they're all part of the same society. Look at countries in colonial Africa where tribal identity is much stronger than national identity for the kind of environment that leads to.

robotnikman 3y ago

I fear that this will give Amazon even more of an advantage over brick and mortar stores.

bombcar 3y ago
We have our best men on closing that gap: https://m.youtube.com/watch?v=KM2UzqO33AY https://m.youtube.com/watch?v=KM2UzqO33AY
add-sub-mul-div 3y ago
They've laundered the victimhood to their customers.
cameldrv 3y ago
Amazon also benefits because that’s where a lot of the stolen merchandise gets fenced. You get a good deal on laundry detergent there because it was stolen from Target.

rahimnathwani 3y ago

Approximate annual figures: $100bn revenue $25bn gross margin $3bn net profit If they could magically eliminate the $1bn of shrinkage, net profit would be 33% higher.

Kye 3y ago
This kind of scale requires eliminating the human element. It's harder to steal from or hurt a person. It's easier to steal from a faceless corporation or abuse someone in a position dehumanized by decades of "that's where you'll end up if you don't study hard."
- rahimnathwani 3y ago
  "It's harder to steal from or hurt a person." I'm not sure. Mom+pop shops suffer from shoplifting (and even armed robberies), even though in many cases the owners are living hand to mouth, and can't really afford the losses. A human can convince themselves of anything (about corporations, about immigrants, about any 'other' group), if it helps them self-justify the actions they want to take.
  - Kye 3y ago
    Harder, not impossible. Though there's probably data out there, and it might show I'm wrong. Maybe it's the same or worse, proportionally.

AndrewKemendo 3y ago

> based on calculations from the company’s financial filings. With the anticipated increase, shrink this year would surpass $1 billion. >It can be difficult to quantify theft, since shrink includes inventory loss from other causes, such as employee theft or damage, too. Based on this story it seems like they could just totally fabricate this number? Surely such numbers would spur a deluge of police reports or at the minimum a wave of insurance claims. Are those signals also present?

qeternity 3y ago
Could they fabricate the numbers? Perhaps, although this is what auditors do. More bizarrely is what incentive they would have to artificially reduce their reported earnings? You seems to be suggesting that you know more about Target’s business than Target does, and I have to believe you’ve already come to the conclusion that retail theft hasn’t increased because that’s a social narrative that suits you.
- lmm 3y ago
  > More bizarrely is what incentive they would have to artificially reduce their reported earnings? The overall shrink number is known and auditable, but they have plenty of incentive to adjust which proportion of shrink they attribute to external theft vs internal theft vs damages if they think one will play better with shareholders than the other. (E.g. external theft is likely to be an industry-wide problem, whereas an increase in internal theft might indicate that Target specifically is struggling to hire high-quality staff)
  - qeternity 3y ago
    RTFA. They haven’t done any of this. The headline is for their shrink number, which they said is fueled by theft. But theft and looting is 10x more difficult to solve than other shrink. It plays worse with investors. If their stores are indeed becoming dangerous, that might also reduce sales from normal customers. All other kinds of shrink they can implement internal processes to reduce. This narrative makes no sense.
- 3y ago

ortusdux 3y ago

Last I heard, they were famous for their loss prevention. Has this changed, or are other stores worse off?

nahnahg 3y ago

[dead]

abudabi123 3y ago

I have seen a couple barcode scan all the items for one product, wasn't in the department store long enough to see the bigger picture. At a guess, the data would be used to trick the department store's information system at some offset in cyber to collect cheese, maybe to collect faked refund.

chucklenorris 3y ago

Wtf is going on in US? Are poor people that desperate that they consider getting shot for groceries? Especially considering how insane policing in US looks like. I live in a poor country and this is not a problem, not at this rate anyways. There are plenty of self serve stores and there's a big push for self checkout too although people hate it.

maxerickson 3y ago
Large retailers don't have armed security. At least, not mostly. Things are still at the point where they are more worried about liability than the stuff getting stolen. The $500 million is less than 1% of their cost of goods. It's an easy place to look for improvements, but it isn't really a threat to their business. I definitely think things have gotten worse. I've directly noticed a couple of thefts at my local Walmart in the last couple of years and hadn't seen any in previous years. In one case I saw a person just push their cart through a self checkout area. In the other, the self checkout I walked up to had an incomplete transaction sitting there.
- mcphage 3y ago
  Self-checkout seems to remove some of the human connection in shopping—there isn't even a face to the corporation anymore.
fatnoah 3y ago
> Are poor people that desperate that they consider getting shot for groceries? The liability and reputational cost of a store security guard injuring a shoplifter, or even getting injured themselves is so high that they might not even be allowed to physically intervene. Naturally, knowledge of this spreads.