Retail Risk Management: Understanding ORC and Shoplifting Statistics

Despite debates over the prevalence and scope of Organized Retail Crime (ORC), it is a nationwide threat to retailers across many industries. Recent investigations have revealed cross-state theft rings and multi-million-dollar operations. Shoplifting, break-ins, and cargo theft can all serve to obtain stolen goods for fencing resale in a variety of markets. The proceeds of these illicit sales have been connected to other crimes, including the trafficking of humans, drugs, and guns. 

Staffing, budgetary, and legal constraints produce a wide range of law enforcement responses to reports of retail theft incidents, and it can be very difficult to determine whether a theft falls under ORC without an in-depth retail crime investigation. Many of these crimes are cross-jurisdiction and remain a low priority among law enforcement’s many concerns. Despite these many limitations, in the last several months, numerous ORC suspects, amounting to many millions of dollars in losses, have been arrested after lengthy investigations.

Increased Retail Crime Rates and Retail Crime Investigation 

In late 2024, a 60-year-old woman pleaded guilty to running an organized crime ring that targeted beauty retail chains and other retailers. She will serve five years in prison and pay $3 million in restitution. She also forfeited her 4,500 square foot mansion, which was sold for $2.35 million. An extensive investigation leading to her and her husband’s arrest in December 2023 determined that their theft ring had stolen about $8 million of products and operations spanned a dozen states. 

According to the National Retail Federation’s (NRF) annual report on shoplifting, there has been an increase in concern regarding ORC, with 76% of respondents reporting they are more worried than they were the previous year. General shoplifting, e-commerce theft, fraud, and repeat offenders also increased the number of concerns for most survey respondents.  

Changes in theft are difficult to quantify

The annual report from the NRF highlights increasing concern among survey respondents not just on ORC but also on theft in general. Surveyed retailers described a 93% increase in the average number of shoplifting incidents from 2023 compared to 2019, similarly reporting a 90% increase in dollar losses associated with retail theft. Survey respondents reported an average of 177 shoplifting events per day in 2023. Retailers reported a 64% increase in the number of shoplifters apprehended from 2019 to 2023, and an 83% increase in shoplifting arrests in the same time period. 

Conversations in media and politics on the topic of retail theft periodically conflate figures concerning shrinkage with retail theft, while shrinkage numbers include all losses from external and internal theft, inventory mismanagement and errors, and damaged goods. This misuse of terms and numbers adds more confusion to the topic and leaves voices pushing for stronger retail theft policies open to criticism.  

For clarity, the NRF has estimated that external theft and shoplifting account for 36% of annual shrinkage figures.  

A report by the Manhattan Institute captures many discrepancies across reports that shoplifting has become significantly worse or significantly better, finding evidence that publicized surges or retreats in shoplifting statistics have more to do with reporting practices than actual incidents.  

Small business owners responding to a Forbes survey revealed that only a third reported shoplifting incidents to the police. Major reasons for not reporting had to do with the time-consuming nature of police reports, hesitancy to involve the police, and doubts about the efficacy of law enforcement to address shoplifting. Large retailers dominate shoplifting reporting — according to the Manhattan Institute study, chain stores, chain pharmacies, and department stores accounted for 75% of New York City’s reported shoplifting. 

This pattern remains consistent in cities across the nation. In San Francisco, half of all shoplifting reports in one month were from a single store. In Minneapolis, two blocks/plazas with target locations accounted for more than 40% of the city’s recorded shoplifting incidents. A relatively small number of businesses provide a warped lens on the magnitude of shoplifting in a community. It also means that changes in the reporting practices at these locations can significantly alter the understanding of shoplifting on the city level. 

Some 65% of NRF survey respondents reported less than half of theft incidents. Felony threshold laws, which stipulate a dollar amount of stolen goods before a theft is a felony limit the use of reporting. For example, 53% cited both felony threshold laws and lack of aggregated theft laws as reasoning behind not reporting thefts to law enforcement. After many years of association with severe underreporting, every state has recently adopted or introduced legislation either targeting Organized Retail Crime or outlining circumstances in which the stolen dollar values from multiple thefts can be aggregated within a certain time frame to more aggressively pursue repeat offenders. 

Repeat offenders and increasing violence in shoplifting incidents 

Repeat offenders are an increasing concern for NRF respondents, with 66% citing this issue. The Manhattan Institute case study emphasized this as a major factor driving shoplifting numbers. According to the NYPD, 327 individuals accounted for 6,600 arrests in 2022, a third of total shoplifting arrests for the year. 

Distressingly, the NRF report also highlights an increased concern surrounding violence in the commission of shoplifting.  

• 91% of NRF survey respondents said that shoplifters were exhibiting more violence and aggression than in 2019.  
• 93% said that the increasing scale of theft and associated violence had negatively impacted their turnover, frustrating the ability to recruit and maintain a skilled and adept workforce. 
• 76% of NRF survey respondents said that the increase in violence associated with thefts has caused them to implement security measures that negatively impact the experience of all customers, including more merchandise locked up, increased uniformed security presence, smaller product selection, and reduced hours.  

Many large retailers have reported increasing asset protection services or retail loss prevention strategies and teams, as well as their technology budgets, in seeking new and better security solutions. Many reported that the increased use of third-party uniformed security provided an increased visual deterrent to would-be thieves. 

Pinkerton is an ideal partner for retailers seeking to curb shoplifting or seeking investigative support for retailers targeted by ORC. From onsite security and technology improvements to supply chain security and site assessments designed to determine and mitigate weaknesses, Pinkerton’s security services help retailers strengthen their holistic risk management programs — providing solutions both long and short-term. 

Pinkerton. We Never Sleep.