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A national lobbying group has walked back its shocking estimate that “organized retail crime” was responsible for nearly half of the $94.5 billion of store merchandise missing in 2021, a figure that helped fuel claims that the United The state was experiencing a wave of shoplifting nationwide.
The group, the National Retail Federation, last week redacted that claim from a widely cited report released in April, after the trade publication Retail Dive revealed that flawed data was used to arrive at the wrong figures.
The move comes as retail chains like Target continue to claim they are victims of acts of theft at large stores, cutting into their profits, forcing them to close stores or Customers have been inconvenienced by keeping products away.
The claims have been fueled by widely shared videos of some examples of brazen shoplifters, including photos of masked groups breaking windows and snatching expensive purses and cellphones. But the data show that this perception of rampant criminality was a mirage.
In fact, according to police data, retail theft in most parts of the country has decreased this year compared to a few years ago. Some exceptions exist, including New York City. But in most major cities, incidents of shoplifting have declined by 7 percent since 2019.
Trevor Wagner, chief economist at the Computer and Communications Industry Association, who has researched the retail data, said organized retail crime, in which multiple individuals steal products from multiple stores and later sell on the black market, is a real phenomenon. But he said organized groups were likely responsible for about 5 percent of the store merchandise that disappeared from 2016 to 2020.
He stressed that there is “a lot of uncertainty and inaccuracy” in measuring losses, as it is difficult to distinguish what is shoplifting and what is organized crime.
Mr. Wagner testified in Congress in June about the discrepancy in the National Retail Federation’s report.
Even though it withdrew the figures and revised the report, the federation, which has more than 17,000 member companies, insisted in an emailed statement that its focus on the problem was justified.
“We stand behind the widely understood fact that organized retail crime is a serious problem that is affecting retailers of all sizes and communities across our country,” the statement said. “At the same time, we recognize the challenges the retail industry and law enforcement face in gathering and analyzing an accurate and agreed upon set of data.”
The issue is “gross annual shrinkage” – the industry term for the value of merchandise that disappears from stores without being paid for through theft, damage and inventory tracking mistakes.
Federation spokeswoman Mary McGinty said the error was caused by an analyst at K2 Integrity, a consulting firm that helped prepare the report.
The analyst, who declined to be named, paired the 2021 National Retail Federation survey with a quote from Ben Dugan, former president of the advocacy group Coalition of Law Enforcement and Retail, who said in 2021 Senate testimony that organized retail crime “is responsible for retailers’ losses of $45 billion annually.”
Mr Duggan was referring to the federation’s 2016 national retail security survey, Ms McGinty said, which was actually referring to the total cost of shrinkage in 2015 – not just the amount lost due to organized retail crime.
Alec Karakatsanis, a civil rights lawyer who has studied and criticized how the media has covered organized retail crime, said the withdrawal underscores how some news organizations, which have largely covered stores, The issue of piracy, covered, was “used as a tool by some vested interests.” “To create a lot of fear about this issue, when in reality, it was quite clear that the facts were not adding up.”
One of the most prominent examples came in October 2021, when Walgreens said it would close five stores in San Francisco, citing repeated incidents of organized shoplifting. The company’s decision comes months after a video, viewed millions of times, showed a man openly stealing products from Walgreens with a garbage bag in hand as others watch.
But an October 2021 analysis by The San Francisco Chronicle showed that police department data on shoplifting does not support Walgreen’s explanation for the store closures.
Ultimately, Walgreens walked back its claims. In January, a company executive said that Walgreens may have overstated the effects on its business, saying: “Maybe we cried too much last year.”
Mr. Karakatsanis said the exaggerated narrative of widespread shoplifting was weaponized by the retail industry as it lobbied Congress to pass bills regulating online retailers, which he claims accounts for most of the stolen goods. The products end here.
Commentators and politicians have seized on this issue. Earlier this year, California Governor Gavin Newsom, a Democrat, responded to reports of rampant theft in the state by calling for tougher prosecution of shoplifters and a plan to invest millions of dollars to fight “organized retail theft.” Did. Florida’s Republican Governor Ron DeSantis signed a bill last year aimed at retail theft, and former President Donald J. Trump, who has called for violence, told Republican activists in California this year that police should shoot shoppers as they were leaving a store.
Mr. Wagner, chief economist for the Computer and Communications Industry Association, said the National Retail Federation’s report in April immediately struck him as wrong. The error was troubling, he said, because the federation has long been seen as a reliable provider of data to the industry.
What made the federation’s mistake even more surprising, Mr. Wagner said, was how different the data was from the group’s own previous findings.
In 2020, the federation said in a report that organized retail crime cost retailers an average of $719,548 per $1 billion in sales — a number that’s nowhere near the nearly 50 percent claim made in the April report.
Another National Retail Federation survey showed that all out-of-state theft – including theft unrelated to organized retail crime – accounted for a 37 percent decline, a figure still well short of the 50 percent miscalculation made in April. Billions of dollars will be reduced.
“It would be a bit like the Census claiming that almost half of the US population lives in the state of Rhode Island,” Mr Wagner said.
