Shoplifting isn’t what it used to be.
Over the past quarter-century, retail theft and fraud are trending down, thanks to technology such as store security cameras and anti-theft tags on merchandise.
But other trends such as self-checkout stations and fewer employees in many stores have created new challenges for retailers, experts say.
Shoplifting remains “one of the most prevalent crimes in the United States,” said Bill Hallan, CEO of the Michigan Retailers Association. “The National Association for Shoplifting Prevention estimates over a half-million incidents of shoplifting occur each day.”
In Michigan, more than 15,500 people were arrested for retail theft or fraud in 2018 -- about one in 14 of all arrests, according to statistics collected by the Michigan State Police.
The good news: Retail theft and fraud arrests are down 33.5% from 2008.
The bad news: The number of organized shoplifting rings have jumped considerably. In Michigan, there were 47 arrests for organized retail theft rings in 2014. By 2018, that had more than quadrupled to 215, MSP data shows.
“Technology has had an effect and it’s been a deterrent,” said Richard Hollinger, a retired University of Florida criminologist who conducts an annual security survey for the National Retail Federation.
But, Hollinger added, there is a growing class of professional shoplifters who have become increasingly sophisticated.
“It’s sort of a cat-and-mouse game" between thieves and retailers, he said. “Retail loss-prevention directors across the country pray they can get their merchandise out fast enough and in large enough quantities before somebody -- either their employers or other people -- steal it."
Long-term trends
Hollinger has been overseeing the National Retail Federation’s annual security survey since 1991.
In the 1990s, the retail shrinkage rate -- or losses due to shoplifting, employee theft or retail errors -- averaged as high as 3% or 4% in some years, he said.
“It’s dropped precipitously since then,” he said, and in recent years, the rate has been about 1.4%.
He attributes that drop to both advances in technology as well the changing face of retailing.
A quarter-century ago, he said, a major source of theft were music CDs and movie DVDs. “They were very easy to steal,” he said. “But very few stores sell CDs or DVDs anymore” as consumers have shifted to downloading or streaming music or movies from the Internet.
As another example, bar codes have made it much easier for retailers to properly track and price their inventory, reducing loss from store errors and making it much more difficult for consumers to defraud stores by switching price tags.
Technology also has considerably reduced employee theft by providing better ways to monitor workers.
“There are a lot of new technologies to catch employees” who might be stealing, Hollinger said, including using algorithms to monitor employees’ behavior at the cash register and alert supervisors to suspicious behavior.
Likewise, technology has created more obstacles for shoplifters, Hollinger said. That includes use of various types anti-theft tags and packaging, as well the expansion of video surveillance cameras.
There are now tags that can be buried inside a device or the packaging, he said. “When it’s build into the packaging, it’s out to take out, hard to damage.”
Video also has been a game changer, he said. “Retailers are working directly with law enforcement, where stores are providing police with a package of evidence,” ranging from video of the suspected perpetrator to photos of the license plate of the suspected get-away vehicle.
New challenges
Meanwhile, gains from loss-prevention technology have been offset by ways in which technology and retailing trends have made it easier to steal, Hollinger said.
Among those trends: The expansion of self-checkout stations.
“Initially, self-checkout was thought to be one of those silver bullet kind of solutions to the increasing costs of doing retail, because your biggest expenses is usually your labor costs,” Hollinger said. “But the downside is that it is somewhat easy to steal in from those kinds of locations, particularly if you can scan one item and take two or three items."
Moreover, the proliferation of self-checkout and other technology such as bar scanning means retail stores need fewer employees, another plus for shoplifters.
“External theft has become more of a factor largely just due to the fact that there are fewer employees in stores,” Hollinger said. “So you have stores getting bigger, with more box stores, and fewer workers to monitor shoppers in these larger stores. That makes it very difficult to actually make an apprehension while the shopper is in the store."
And to make complicate matters, retailers have increasingly adopted a policy of not pursuing shoplifters once they leave the building.
“Virtually all retailers do not allow employees to pursue shoplifters out into the parking lot,” Hollinger said. The chance of a violent confrontation makes it “just too risky, so employees are told not to chase people."
Organized criminal rings
One of the growing concerns for retailers is the increase in organized crime rings, who take advantage of the fact many stores have fewer employees and are less likely to pursue shoplifters outside the store.
“I think the bottom line is, shoplifting is a problem but a bigger problem is organized retail crime,” Hallan said. “Those folks are sophisticated criminals” who know how to exploit vulnerabilities.
That includes the fact that selling stolen goods is easier than ever, Hollinger said. Instead of furtively fencing goods from the back of a truck, thieves now can use the Internet, which offers more anonymity as well as access to a larger market.
Thieves in organized crime rings will send several people in a store armed with a list of merchandise that sells well online, such as over-the-counter drugs, cosmetics, baby formula, razors, clothing and electronics. The idea is to get in and get out fast.
“They know if they can get the items and get out, they can beat the system,” Hollinger said. “Professional shoplifters, they know about the cameras and they know how to avoid them. They know about the (anti-theft) tags and how to defeat them.”
Sometimes it’s a “push out,” which is "is loading up a cart with high-priced goods and barreling out, " knowing store policy prohibits employees from chasing down thieves in the parking lot, Hallan said.
“The problem with those criminals, is they’ll resist arrest and they’ll resort to any means to avoid store security,” Hallan said.
In 2012, Michigan passed a new law to increase the criminal penalties for organized retail crime rings. The law makes it a five-year felony to steal from retail stores with the express purpose of reselling goods.
Such rings tend to operate in metro areas with numerous shopping malls, big box stores and other retailers, so they can go to different multiple sites in a day or week, Hollinger said.
In Michigan, two-thirds of the 2018 arrests for organized retail crime rings occurred in the state’s four largest counties -- Wayne, Oakland, Macomb and Kent.
Police perspective
Kalamazoo County ranks sixth among Michigan counties in arrests for retail fraud/theft, and within the county, Oshtemo Township has displaced Portage as the community with the most arrests.
Kalamazoo County Undersheriff James VanDyken says he’s not surprised, considering the growth in Oshtemo’s retail corridors just west of the city of Kalamazoo. The township’s major retailers include Meijer, Walmart, Target, Costco, Menard’s and Lowe’s.
In 2008, the township had 94 arrests for retail theft or fraud. In 2018, it was 300.
“Oshtemo Township is a very vibrant community, but that makes it very susceptible to shoplifting,” VanDyken said.
Organized crime isn’t much of a factor, though, VanDyken said. Most shoplifters are relative amateurs, stealing random items.
VanDyken said the biggest change he’s seen over the past two decades is the explosion in video surveillance, which has made it easier to catch thieves.
“Videos are the most-common evidence we get,” he said.
Hallan, the CEO of the Michigan Retailers Association, said that technology such as videos have, on the whole, made a positive difference for retailers in terms of loss prevention. But shoplifting remains a problem, one that costs retailers an estimated $36 billion in 2018. That equates to almost $300 a year per U.S. household.
“Eventually those losses find their way to consumers,” Hallan said. “Retailers have to figure out a way to make a profit and if their goods are being stolen, it affects the price that we all pay."
Online database
Our online database includes any Michigan city or township that reported at least one retail fraud or theft incident in 2018, based on data collected by the Michigan State Police.
The database allows you to look up the number of retail thefts and fraud cases reported to police as well as the number of arrests.
If you call up a county without specifying a community, you can see the cities and townships ranked by number of incidents.
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