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What's missing from what Target and others are trying to have us believe is that employee theft and corporate ineptitude account for 56% of "shrinkage". Also, e
by c420 3y ago
What's missing from what Target and others are trying to have us believe is that employee theft and corporate ineptitude account for 56% of "shrinkage". Also, external theft is trending down while internal theft is trending up.
"While retailers and the NRF are increasingly saying crime is cutting into profits, losses from internal and external theft last year were largely on par with historical trends. They made up 65% of total shrink, the survey found.
External theft, which includes organized retail crime, was again reported as the largest source of shrink last year at 36.15%, but that was slightly below 37% in 2021. Internal theft, or goods stolen by employees, rose slightly to 28.85% from 28.5% in 2021. Process and control failures and errors made up 27.29% of shrink in 2022, up from 25.7% the year prior."
https://www.cnbc.com/2023/09/26/organized-retail-crime-and-theft-not-increasing-much-nrf-study-finds.html https://www.cnbc.com/2023/09/26/organized-retail-crime-and-t...
- credit_guy 3y ago> Target and others are trying to have us believe I doubt Target or other are "trying to have us believe". Closing a store is quite a big business decision, it's not likely they are doing that in order to promote a thesis. While I don't dispute your numbers, it is entirely possible that they are correct as an average, but Target has 2000 stores in the US, and they are closing only 9.
- Avshalom 3y agoIs it a big business decision or is it just 9 out 2000.
- credit_guy 3y agoClosing a store is definitely a big business decision. I mentioned 9 out of 2000, hoping that it is self evident that a statement about stable average theft over 2000 does not contradict the fact that in the extremes you can have a large increase in theft that results in unprofitable stores.
- actuallyalys 3y agoThe argument isn’t that they’re closing the stores to promote a narrative, but that after deciding to close a store, they will spin it as favorably as possible.
- chii 3y agoSo if the spin is not real, what is the reason, and why does it needs to be spun?
- aaomidi 3y agoThe people who would be shareholders are ones that would also be a lot more worried about crime in general. These people are also more usually on the side of cops. Especially when it comes to “rioting”. The events of 2020 has allowed for a new boogeyman to be used in these decisions and it basically softens the impact.
- rayiner 3y ago> The stores include the East Harlem location in New York City, two locations in Seattle, three locations in Portland, and three locations in San Francisco and Oakland. These are all growing or at least stable cities with strong economies. It seems unlikely that they were forced to close these stores for some reason and was forced to come up with a post hoc rationalization.
- vGPU 3y agoThey’re also (mostly) all known for their recent spates of looting.
- fshbbdssbbgdd 3y agoWhat’s favorable about announcing that you’re closing a store due to theft?
- BoorishBears 3y agoWhich does the market respond better to: - We closed a store due to a miserable economic outlook: https://www.forbes.com/sites/pamdanziger/2023/08/12/consumer-spending-slows-putting-the-rest-of-year-at-risk-for-retailers/?sh=4cc8042810e5 https://www.forbes.com/sites/pamdanziger/2023/08/12/consumer... - We closed a store due to crime Some people assume if you're denying the retailers' claims on theft, you're really just burying your head in the sand about crime... but no. Target is a corporation. A decision like this is not made so transparently and neatly that you can package up it up in a headline. Whatever ends up as the headline is what Target wants to signal, not just to the market, but to its own stores and employees.
- searealist 3y agoYou are labeling statistical noise as trends. I think it's you who is being manipulative, not Target.
- fasthands9 3y agoWhile I don't doubt those general numbers, it seems likely that the 27% of "control failures and errors" are relatively consistent among stores while "external theft" could be magnitudes higher in some locations in others. I live in Brooklyn and things like toothpaste and detergent are in lock and key in Target. I just end up ordering them on Amazon.
- ungruntled 3y agoWithin the last 6 months, a local Target I use has refitted most of the store with locked sliding doors for shelves and anti-theft tags for larger items. I noticed that high priced groceries like steaks also tend to be permanently ‘sold out’. There is an open street market nearby that sells products that match closely with what the target sells. Homeless tend to just hang out in front or inside. Wasn’t like this several years ago, so times are clearly changing.
- qeternity 3y ago> employee theft and corporate ineptitude account for 56% of "shrinkage" On average. Across all stores. Across the whole industry. In 2022. It's not missing. They are closing 9 stores where this clearly doesn't hold up. And those stores are in cities with extremely lax policies towards theft.
- aurareturn 3y agoOr maybe just occam's razor: the stores are unprofitable due to mostly theft, internal and external. So Target is closing them down.
- sputr 3y agoComparing rates to 2021 seems to me to be a bad faith argument, since they would almost certainly argue that the reason goes a little further back than that.