Walgreens CEO says anti-shoplifting strategy backfired: 'When you lock things up…you don't sell as many of them’
Walgreens' CEO talked about the flip side of investing in increased security on a recent earnings call.
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I expect lighting, store position, lots of cameras, hidden security tags, diligent security and psychology would minimize losses and maximize the chances of catching people stealing items.
It’s organized theft rings with someone likely on the inside providing info. It’s not random people taking items because they’re broke.
There are organized groups, but they mainly operate through removing and slap-tagging (placing an adhesive barcode for a cheap product over an expensive one).
Some of them get very specific. When I worked at a major outdoors chain, they'd get a $3,000+ Hummingbird sonar unit and put on a tag for a $100 Hummingbird unit, so the cashier would see the correct brand name pop up on the screen.
When I was a teenager I worked at a grocery store. We’d replace the cases of red Bull barcodes with tuna fish can barcodes and go through self checkout with it.
Retailers fault thinking they can save $ by automating away jobs.
I'm surprised the scale didn't flag it
This was early self checkout
I'm sure it's all sorts - teams, meth heads, kids, desperates, employees whatever. These "loss prevention" units have to figure the best way to deter theft before it happens, detect theft when it happens, trespass / prosecute thieves, and minimize loss of sales all at once. It's a difficult calculus I'm sure.
It may be all sorts, but I suspect the biggest "shrinkage" cost is due to more organized crime. E.g. covers over the detergent, it's not because of people sneaking it for themselves, it's because some folks did a black market of stolen detergent.
