Source: https://www.nytimes.com/2023/09/26/business/target-store-closures-theft.html
Archive: https://archive.ph/JAeMX
Target press announcement: https://corporate.target.com/press/...t-Closes-Select-Stores-to-Prioritize-Team-Mem
By Jordyn Holman
Sept. 26, 2023, 3:00 p.m. ET
Target announced on Tuesday that it was closing nine stores across four states, saying theft at the locations was harming its business and threatening the safety of employees and customers.
The stores being closed next month include one in Manhattan’s East Harlem, which has been open since 2010, and multiple locations in San Francisco, Seattle and Portland, Ore.
“We know that our stores serve an important role in their communities, but we can only be successful if the working and shopping environment is safe for all,” the retailer said in a statement.
In recent months, Target has been vocal on the topic of theft within its stores, particularly about organized retail crime, in which a large amount of merchandise is stolen with the aim of its being sold on the black market.
While speaking on an earnings call in August, Target’s chief executive, Brian Cornell, said that the company “continues to face an unacceptable amount of retail theft and organized retail crime.” He said that in the first five months of the year, thefts in its stores that involved violence or threats of violence rose 120 percent.
Executives at other retailers like Macy’s and Dick’s Sporting Goods have also been warning Wall Street about the impact theft is having on their business.
On Tuesday, the National Retail Federation released its annual survey of big brands, which found that the average rate of shrink — the industry term for the value of merchandise that disappears from stores without being paid for, through theft, damage and inventory tracking mistakes — increased to 1.6 percent of sales in 2022, from 1.4 percent in 2021. The average rate of shrink was 1.6 percent in 2019 and 2020.
Thirty-six percent of shrink comes from theft, according to the survey, while 29 percent of it is attributed to employee theft. Twenty-seven percent came from process, control failures and errors, according to the survey.
Although the rate of shrink remains similar to what it was in 2019 and 2020, some retailers are saying they find theft a greater cause for concern. This year, two-third of respondents said they were seeing even more violence and aggression from those participating in organized retail crime.
In May, Michael Fiddelke, Target’s chief financial officer, said if the shrink trend continued, the retail chain would lose $500 million in profit. The company has also been spending more on security, including using third-party guard services.
Some unions that represent retail workers have said that store workers have faced more instances of unruly customers and various acts of crime, including assaults, on the job since the start of the pandemic.
But some in the industry caution that there isn’t enough reliable data around the topic. Retailers often talk more about shrink during times of economic distress, analysts say, when their profits are already being squeezed. Retailers also don’t always report crimes in their stores, making it difficult to know how often they are occurring.
There have also been some retailers who later say that their concerns about shoplifting were overblown. That was the case with Walgreens, which said in January that “maybe we cried too much last year” about the issue of theft.
Executives, who have talked publicly about theft and organized retail crime, have said that they need help from government officials and law enforcement to solve what they see as a widespread problem. Target said it called on officials to support a bill in Congress that would create a task force of federal agencies to address retail crime. It said it was also hosting store walks with various government officials, including members of Congress, state legislators and local community partners, to educate them on how the company was trying to address the issue.
Target has said the safety of its employees has been threatened in other ways this year. In June, the company adjusted its Pride Month displays in some locations by moving some of its merchandise to the back of the store after it said workers were getting screamed at by customers.
On Tuesday, Target emphasized that while it was closing some of its stores, there were other locations nearby for people to shop. It said “eligible team members” would be offered jobs at other Target locations.
Store closings will take place on Oct. 21.
Jordyn Holman is a business reporter, covering the retail industry and consumer behavior. More about Jordyn Holman
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Archive: https://archive.ph/JAeMX
Target press announcement: https://corporate.target.com/press/...t-Closes-Select-Stores-to-Prioritize-Team-Mem
Target, Citing Theft, to Close Nine Stores
The retailer will close locations in New York, San Francisco, Seattle and Portland, saying its business had been hurt and the safety of employees and customers was at risk.By Jordyn Holman
Sept. 26, 2023, 3:00 p.m. ET
Target announced on Tuesday that it was closing nine stores across four states, saying theft at the locations was harming its business and threatening the safety of employees and customers.
The stores being closed next month include one in Manhattan’s East Harlem, which has been open since 2010, and multiple locations in San Francisco, Seattle and Portland, Ore.
“We know that our stores serve an important role in their communities, but we can only be successful if the working and shopping environment is safe for all,” the retailer said in a statement.
In recent months, Target has been vocal on the topic of theft within its stores, particularly about organized retail crime, in which a large amount of merchandise is stolen with the aim of its being sold on the black market.
While speaking on an earnings call in August, Target’s chief executive, Brian Cornell, said that the company “continues to face an unacceptable amount of retail theft and organized retail crime.” He said that in the first five months of the year, thefts in its stores that involved violence or threats of violence rose 120 percent.
Executives at other retailers like Macy’s and Dick’s Sporting Goods have also been warning Wall Street about the impact theft is having on their business.
On Tuesday, the National Retail Federation released its annual survey of big brands, which found that the average rate of shrink — the industry term for the value of merchandise that disappears from stores without being paid for, through theft, damage and inventory tracking mistakes — increased to 1.6 percent of sales in 2022, from 1.4 percent in 2021. The average rate of shrink was 1.6 percent in 2019 and 2020.
Thirty-six percent of shrink comes from theft, according to the survey, while 29 percent of it is attributed to employee theft. Twenty-seven percent came from process, control failures and errors, according to the survey.
Although the rate of shrink remains similar to what it was in 2019 and 2020, some retailers are saying they find theft a greater cause for concern. This year, two-third of respondents said they were seeing even more violence and aggression from those participating in organized retail crime.
In May, Michael Fiddelke, Target’s chief financial officer, said if the shrink trend continued, the retail chain would lose $500 million in profit. The company has also been spending more on security, including using third-party guard services.
Some unions that represent retail workers have said that store workers have faced more instances of unruly customers and various acts of crime, including assaults, on the job since the start of the pandemic.
But some in the industry caution that there isn’t enough reliable data around the topic. Retailers often talk more about shrink during times of economic distress, analysts say, when their profits are already being squeezed. Retailers also don’t always report crimes in their stores, making it difficult to know how often they are occurring.
There have also been some retailers who later say that their concerns about shoplifting were overblown. That was the case with Walgreens, which said in January that “maybe we cried too much last year” about the issue of theft.
Executives, who have talked publicly about theft and organized retail crime, have said that they need help from government officials and law enforcement to solve what they see as a widespread problem. Target said it called on officials to support a bill in Congress that would create a task force of federal agencies to address retail crime. It said it was also hosting store walks with various government officials, including members of Congress, state legislators and local community partners, to educate them on how the company was trying to address the issue.
Target has said the safety of its employees has been threatened in other ways this year. In June, the company adjusted its Pride Month displays in some locations by moving some of its merchandise to the back of the store after it said workers were getting screamed at by customers.
On Tuesday, Target emphasized that while it was closing some of its stores, there were other locations nearby for people to shop. It said “eligible team members” would be offered jobs at other Target locations.
Store closings will take place on Oct. 21.
Jordyn Holman is a business reporter, covering the retail industry and consumer behavior. More about Jordyn Holman
Previous, similar posts:
