New York retailers have self-reported $4.4 billion in losses due to theft in 2022.

Albany Times Union
November 24, 2023

ALBANY — New York state retailers are waging a fight against shoplifting and organized theft that they say has cost their industry around $4.4 billion in 2022 alone — leading to dire predictions of store closures, hiked consumer costs and increased violence across the state.

Many of New York’s elected leaders, including Gov. Kathy Hochul, have long signaled their interest in tamping down crime rates amid politically charged conversations on public safety that have driven recent election cycles. Retailers and trade associations, in urging greater legislative intervention on organized theft, have tied the financial losses to safety concerns and quality of life issues.

The evidence is visible in many stores: security personnel are posted outside of pharmacy chains, while once-innocuous items like detergent or deodorant are locked behind glass cases.

High-profile national and regional chains have also blamed recent brick-and-mortar store closures on losses associated with organized theft and shoplifting. Earlier this month, Stewart’s Shops said they were shuttering a Central Avenue store in Albany, citing an increase in shoplifting and verbal and physical assaults. In September, Target announced it would close nine stores — including one in New York City — and similarly blamed theft and organized retail crime for threatening employee safety and hampering business performance.

Still, earlier this week, Hochul vetoed a bill that would have created a task force dedicated to studying organized retail theft, which several states across the country have adopted to combat the nationwide problem. The panel, which would have had 15 members appointed by the governor, leaders of the state Senate and Assembly, and the attorney general, would have gathered information on organized retail crime and developed recommendations to counter losses in New York and respond to the problem.

But Hochul, who vetoed 30 other bills that would have created various commissions and task forces, said the cost of approving that full suite of measures  would have cost the state $35 million — funding that remains unaccounted for in the state’s financial plan. Instead, she suggested some task forces may be included in the upcoming budget.

In a statement following the veto, Melissa O’Connor, who heads the Retail Council of New York State, said retailers are “extremely disappointed” and that the implications extend beyond fiscal damage to community safety.

“Addressing this complicated issue requires interagency coordination and consistent communication among all stakeholders, including the retail industry,” O’Connor said. “On behalf of the largest private sector employer in the economy, the Retail Council of New York State continues to meet with lawmakers, prosecutors and law enforcement to hold organized retail crime syndicates and repeat shoplifters accountable.”

Retailers and trade associations have self-reported an increase in “shrinkage” related to organized theft and shoplifting. Shrinkage refers to all loss of inventory, which can be caused by numerous factors, including employee theft and damaged goods.  A survey released in September by the National Retail Federation reported nationwide losses of $112 billion in 2022. More than two-thirds of respondents reported that organized retail crime had driven violence and aggression across storefronts compared to the prior year.

Yet, further scrutiny into store closures has painted a more complicated story. The Times Union reported that emergency calls related to purported assaults have been relatively nonexistent at the Stewart’s on Central Avenue that’s closing, even though the store had cited an increase in assaults as a major reason behind the closure.

The Albany Police Department recorded 23 calls for larcenies this year, up from 14 in 2022 and 12 and 2021. Police said five people have been arrested at the store since April 2021; the most recent arrest occurred in July for petit larceny. Calls for police assistance have dropped since 2021, although not all incidents are reported to police.

Meanwhile, Target executives have not reported concrete data on shrinkage as being driven by retail theft, relying instead on vague trend analysis.

Charles Lindsay, a marketing professor at the University of Buffalo, said that it is easier for retailers, especially large chains, to blame shoplifters on organized crime and other criminal forces than to admit that they have strategically erred in opening new locations too close together.

“It’s much easier for stores to blame theft when they close and people get upset than, ‘Oh, we overbuilt 20 years ago,’” Lindsay said. He added that the perceptions of theft rapidly increasing are likely being driven by some real uptick in thefts, but that the percentage of total sales that are attributable to shrink in general have remained relatively stable over the years.

At the end of the day, Lindsay said, consumers will likely feel the sting from increased prices and a more guarded shopping environment. 

Narratives of major theft rings have mostly been concentrated in New York City, where city officials have said the total number of shoplifting complaints has increased every year between 2018 and 2022, though the city reported a drop in similar complaints so far in 2023.

Mayor Eric Adams, announcing a citywide crackdown on retail theft, has called for a localized version of the organized retail crime task force to concentrate on theft across the five boroughs. Leaders there tied the issue both to organized crime and to individuals who struggle with substance use disorders, mental illness and homelessness.

But upstate business owners have indicated pervasive retail theft is plaguing the rest of New York as well.

 “It’s statewide — my members from Buffalo to Long Island have told me that there’s concerns about not just organized crime, but crime in general,” said Kent Sopris, president of the New York Association of Convenience Stores.

Albany County District Attorney David Soares said that the greater Capital Region has long been a target for shoplifting and organized retail theft, given the area’s central location and high-volume shopping districts.

Soares suggested that the situation has worsened given recent changes made to bail laws that, in many cases, may prevent holding people accused of larceny in correctional facilities.

“Retail theft is reshaping communities of color and shuttering stores in spaces needing them most,” he said. “Pharmacies and supermarkets are closing along important commercial corridors for Black and brown consumers. People are losing their jobs because of business closures due to rampant retail thefts.”

Soares compared analysts and academics who point blame at big corporations’ mismanagement for the brunt of their inventory shrinkage to “vaccination truthers” and “those who supported the criminal justice reforms that enable criminals to behave like locusts destroying local commerce.”

“These truthers rely on their academic validators who spew these outrageous theories that can be reduced to: ‘There is nothing to see here; do not believe your lying eyes,’” he said. “Thieves that would have been sitting in a local jail in 2019 are now released to continue to steal and the academics want you to believe the fault is due to corporate greed and not thieves raiding shelves at your local retailer. It’s a false narrative and It’s just irresponsible.”

Alterations to bail statutes made last year that were intended in part to address repeat shoplifting offenders did not seem to play out as Hochul — who had backed the changes at the behest of law enforcement officials and prosecutors — had expected, the Times Union has reported. Data shared by the court system this summer showed that after rollbacks to the original 2019 bail law alterations, the number of cases dealing with repeat shoplifting offenders where judges set bail increased only slightly.

 

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