Organized retail crime is on the rise. But what is it and how can you prevent it?
Has your store ever been hit by an ORC theft squad? Sometimes it happens loud and fast, but most of the time, you don’t even notice it’s happening until you discover a gaping hole in your inventory.
How are you going to explain that to your boss?
Organized retail crime (or ORC theft) is a big problem all over the country, and due to the low-risk/high-reward nature of the activity, the popularity of ORC is gaining more and more traction each year: According to the National Retail Federation’s annual survey on the topic, ORC cost retailers an average of $719,548 for every billion dollars in sales. In 2015, the loss was drastically lower at just over $450,000.
Let that sink in. Hundreds of thousands of dollars for every billion in sales. This isn’t just a few shoplifters putting a barely-detectable dent in your revenue: this is an organized crime against your livelihood. So let’s talk about identification and ORC loss prevention.
The key word here is organized. ORC theft is a premeditated burglary that involves multiple offenders who operate in different specified roles or positions. These crime rings often hit multiple stores in one run, collecting a car full of stolen goods that are sold or “returned” for store credit or even cash, depending on the return policy. Oftentimes, these items are sold via online marketplaces, which makes it nearly impossible to trace the criminal activity back to the seller.
The core objective behind organized retail crime is to steal items that can easily be sold or returned for a profit and it would seem that no brand or industry is immune. Targeted products run the gamut of retail items, from baby formula to Fendi purses.
The first and most common form of organized retail crime is referred to as boosting. This is the basic act of walking into a store and stealing item(s) without being caught. This can be done in any number of ways, from pocketing smaller items to simply walking out the front door with a cart full of big-ticket merchandise and enough confidence in your step that nobody questions you.
Cargo theft is the act of stealing merchandise from its point of origin to the final retail destination. This criminal activity can range from breaking into a warehouse on a weekend to robbing a truck in transit.
Flash robbery (also labeled as multiple offender crimes) is perhaps the most unique and seldom-employed method of ORC fraud. This is when several criminals enter a store at once, grab whatever they can carry, and escape quickly to waiting cars just outside the doors.
In this video from ABC7 News, you can watch for yourself as nine men steal an estimated $30,000 worth of merchandise in less than 30 seconds.
What can you do to avoid falling victim to organized retail crime? Here are the most effective ORC loss prevention tactics.
95% of all businesses have suffered from employee theft and 29% of reported cases lasted for more than five years—now this isn’t to say that all employee theft is ORC, but that doesn’t make it improbable. Some ORC rings have a man or two on the inside posing as an employee. Make sure you’re running thorough background checks before you hire a new staff member. While not every offender has a prior record, this crucial step can help you avoid hiring someone with a risky background in retail theft.
The best part about this ORC loss prevention method is that you can chalk it up to good customer service. Here are a few ways you can improve your customer service while also protecting your business:
The more eyes you have on different areas of your store, the more likely you are to catch criminals in the act or deter them all together. Train your employees on how to spot retail theft red flags and make sure you’re never understaffed.
A rigid return policy can limit the amount of successful fraudulent returns at your store. If you can make it fair for your honest customers while also posing a challenge to ORC thieves, you can label your store as a less-desirable location for return fraud.
You’d be surprised at how effective the presence and disclosure of top-notch security can be at deterring criminals. Protect your business by investing in a high-quality surveillance system. Then brag about it. Post signage and sing it from the rooftops: THIS STORE IS NOT TO BE MESSED WITH.
Not only can this security measure deter criminal activity, but it will also make sure you detect any organized retail crime happening in your store and put a stop to it—especially if it’s at the hand of your own employees.
Organized retail crime is on the rise—protect your business now. Explore the retail security solutions LiveView Technologies has to offer, or contact us today to get your free quote.
