When the World Health Organisation (WHO) declared the coronavirus a ‘global pandemic’ on 11 March 2020, governments across the world began restricting the movement of people through social distancing, introducing local and national lockdowns to help slow the spread of the virus. One major result of this reduction in mobility was a vast decline in many types of crime.
At this time, there was widespread closure of shops in the general retail sector, which naturally decreased the opportunities for shoplifting. Supermarkets and other grocery retailers remained open, however, the promotion of social distancing and added security is likely to have discouraged shoplifters. Interestingly though, preliminary evidence of pre-lockdown spikes in shoplifting was likely facilitated by extra cover in crowded stores as customers stockpiled.
The National Association of Shoplifting Prevention, (NASP) in Melville, New York, reported that grocers in the area noticed an alarming increase in shrinkage due to the coronavirus pandemic, backed up by figures from the New York Police Department (NYPD).
Elsewhere, according to the Maricopa Police Department in Arizona, statistics on the occurrence of crime since the onset of the pandemic showed a strong uplift in the number of thefts, mostly incidents of retail shoplifting. They reported 63 theft arrests in March, an increase of 250% over the same period in 2019. Typically, they have found that shoplifting incidents included electronics and higher ticket items, however, during the height of the coronavirus lockdown, these thefts included lower-ticket household items such as cleaning supplies, food, and clothing.
Does fewer staff create an opportunity for theft?
Over the summer months, lockdowns across the UK and Europe had a huge impact across all stores. With retailers realizing mounting losses and social distancing meaning footfall is far from normal, many of these retailers now operate on a skeleton of their pre-Covid staffing levels.
Retailers suffering from this economic downturn have also had to cut back on security staff or position this personnel solely at the door to help with social distancing and store occupancy levels. As such, there are fewer store attendants to manage and deter potential shoplifters. In addition, there are fewer staff to carry out important product tagging requirements on the large and constantly changing inventory of stock, meaning more and more items on the shop floor are ripe for the picking.
Hidden identity and fewer repercussions
Further to the reduction in loss prevention measures, the now normalized worldwide practice of wearing masks has provided greater anonymity to thieves. Many argue this has emboldened shoplifters, making it even easier for them to shoplift, with retailers and retail representatives in the UK reporting that shoplifting has “noticeably increased” since the introduction of new face mask regulations.
During the pandemic, the British Security Industry Association (BSIA) announced that shoplifters caught trying to steal goods would face a “hands-off” approach and largely not be physically tackled. Instead, they would be told to put the items back and leave the store, with police only be called as a last resort under the “deterrence” strategy.
The story is much the same in the US. A report from ABC stated that convenience store owners in Philadelphia were claiming that the city’s lax law enforcement had resulted in an increase in shoplifting6. And in March, amid the height of the pandemic, the Philadelphia Police Commissioner said that the department would halt arrests for non-violent crimes, including theft, to prevent the overcrowding of jails which many convenience store owners claimed increased shoplifting.
A further influencing factor is the widespread introduction of automated self-checkout machines. About 40% of transactions and 20% of sales by volume now takes place on self-checkout stations and last year, the self-checkout market was projected to grow by a CAGR of 10.3% by 2024. The coronavirus pandemic is likely to have accelerated this further, also hailing a move towards less traditional payment methods such as contactless. It is widely known that the use of self-checkouts in retail directly results in increased shrinkage. When comparing stores with and without fixed self-checkouts, a research paper by Efficient Consumer Response (ECR) found that those with fixed self-checkouts had greater levels of loss, with some grocery case studies recording losses in the region of 33% to 147% higher. Furthermore, the report found that stores, where 55-60% of transactions went through Fixed SCO, can expect their shrinkage losses to be 31% higher. With an almost contact-free shopping experience, there is also a common belief that the ease of theft at self-checkouts inspires people who might not otherwise steal– a trend that would likely be amplified in an economic downturn when unemployment is on the rise.
Looking to the past to help with the future
As the coronavirus pandemic continues to impact all industries across the world, retailers are being forced to adapt as well as make long term predictions and plans. It can be helpful during an economic downturn to look back at similar crises in the past. Research from global recessions, particularly of 2008-2009, shows that as unemployment rises and spending tightens, shoplifting increases.
According to an annual survey of more than 1,000 retail chains globally, at the end of 2009, incidents of shoplifting had risen by 5.9% in comparison to an average of 1.5% in previous years. The problem was documented from retailers across all regions, with an increase of 4.7% in Europe, totaling losses of $44 billion.
It’s clear that in this climate, retailers would benefit from reviewing their product protection plans by evaluating high, medium and low-risk products and stores, introducing a loss prevention strategy in line with the demands, and driving best protection and return on investment.
Demonstrating best practice in Source Tagging
Tagging in retail environments has historically demonstrated a reduction of shoplifting events and repeated industry studies demonstrate these benefits. At past National Source Tagging Symposiums, sponsored by Checkpoint, attendees have reported impressive results. According to one VP of Loss Prevention at a major North American drugstore chain, “Source tagging alone reduced theft of high-risk items by 44% in our stores.” Another noted that “visible EAS labels are a great theft deterrent and source tagging protects the look and feel of premium packaging better than in-store tagging.”
For retailers already using EAS systems in-store, source tagging programs are a popular choice as it means EAS labels are efficiently applied in/on packaging at the point of manufacture. This ensures contactless protection for both staff and customers. Here, retailers can reduce the associated labor costs with tagging, maximize brand integrity and increase sales through on-shelf availability, while ensuring store personnel are free to focus on the priorities in-store. By optimizing the performance of retail EAS solutions, increasing sales and reducing theft, retailers can work to protect their stores and ultimately, the bottom line.
A global leader in Source Tagging solutions
With more than 25 years of experience implementing source tagging programs, Checkpoint has the resources and expertise to help retailers understand and implement a source tagging program that works for their business. We understand the importance of working closely with our customers and their vendors to effectively assess supply chain and retail challenges and create a program that responds to their needs. This not only takes into consideration the design implications of label placement, but the technological innovations required to capture and relay important information to enhance traceability and critically, stock availability.
With the biggest source-tagging team in the world, we are uniquely placed to help retailers maximize the benefits of their source tagging programs to reduce shoplifting and improve operational efficiency across the supply chain.
