Organized retail crime (ORC) preys on retailers of all sizes. From retailers with thousands of locations to something as small as an Irvine, CA, family-owned jewelry store. While retail crime can be as simple as a teen shoplifting an energy drink from a convenience store, organized retail crime is a much more insidious and darker byproduct of traditional retail crime.
What is organized retail crime?
Organized retail crime (ORC) or professional shoplifting, is a calculated attack on retail operations. ORC is often a coordinated effort by groups or networks to steal large quantities of merchandise from retail stores. Unlike casual shoplifting, ORC includes planned operations involving multiple people and stages of crime. From the organizer who selects the location(s) to hit, perpetrators (or “boosters”) who steal the physical items, and finally, to the “fencer”, with stolen goods often sold through secondary markets such as online platforms, flea markets, or black markets.
The impact of organized retail crime on retailers and consumers
Organized retail crime is skyrocketing; in the U.S. alone, the Department of Homeland Security (DHS) estimates that the impact of organized retail crime costs federal and state governments nearly $15 billion in lost tax revenue, which is ultimately passed along to the American consumer, costing them more than $500 annually in additional costs. The issue of ORC has ballooned to such a problem that a bipartisan group of lawmakers within Washington DC has demanded that the DHS take broader actions on organized retail crime; their concerns stemmed from the violence that is associated with ORC and also the risk to consumers who can be potentially consuming improperly stored or tampered products such as baby formula, beauty products, or over-the-counter medication.
Every year, ORC endangers, injures, and, in some cases, kills retail associates. 81% of NRF’s 2023 National Retail Security Survey respondents reported that organized retail crime offenders have grown more violent overall, and 67% of respondents noted a surge in perpetrator aggression compared to the previous year.
Common tactics used by organized retail thieves
A massive organized retail crime takedown recently occurred in Southern California, where fifteen individuals waged an ORC attack on several outlet stores. The suspects were caught with $23,000 worth of stolen property, a stolen vehicle, around 90 grams of methamphetamine, and various burglary tools.
What can Loss Prevention and retail shrink experts take away from this case of ORC? The big takeaway is making sure your Loss Prevention teams have the tools and systems in place to build thorough cases so local law enforcement can reach that critical felony theft threshold, allowing them to press felony charges immediately. Law enforcement organizations such as the Ventura County Organized Retail Theft Task Force welcome the support of Loss Prevention experts to help keep these criminals off the streets and away from innocent customers.
Another recent organized retail crime crackdown in Los Angeles captured six suspects who had stolen more than $90,000 worth of merchandise from various stores within a Woodland Hills mall.
Organized retail crime rings thrive on manipulating rules – in some cases, the rules regarding retail returns – so Loss Prevention teams must utilize AI-driven exception-based reporting (EBR) to stop the ring at its core.
Suppose an organized retail crime ring is pushing accomplices to return stolen merchandise. In that instance, the proper EBR system will shut down the return in real-time by finding the center of the ring, which could be a credit card, a customer loyalty number, a shipping address, or another specific identifier that ties everyone within the ring together. Once shut down, the ring leaders realize it’s time to move on to another retailer.
Actionable strategies and advanced tools to prevent organized retail crime
The best loss prevention strategies for attacking organized retail crime head-on must operate similarly to the famous “Triangle Offense” utilized by the Chicago Bulls during their legendary run of championships in the 1990s. The offense works by utilizing constant motion on the court, which forces the defense to constantly adjust. When Loss Prevention teams operate similarly, ORC rings are caught off guard because there are three points of attack that they need to continually adjust for, which weakens their overall plan and leaves them vulnerable to arrest.
The ideal “Loss Prevention organized retail crime triangle offense” operates by continuously executing three principles:
- Implementing advanced surveillance systems and AI: The best Loss Prevention (LP) teams must be able to swiftly capture incidents of ORC, collect evidence, manage multiple suspects, vehicles, events, and resolve investigations quickly and efficiently. This is a must to keep your LP team ahead of organized criminal organizations.
- Training employees to identify suspicious behaviors: Employees are not just your frontline resource for natural surveillance within your stores; they are integral to the prevention process. With the right training, they can understand the tactics and “tells” of organized retail crime suspects, empowering them to play a crucial role in your organization’s security.
- Collaborating with law enforcement agencies: Many law enforcement agencies and lawmakers want to stamp out ORC, but Loss Prevention leaders need to maintain a symbiotic relationship with local law enforcement agencies to keep the threat of ORC high above petty one-off shoplifting. Data shows that some loss prevention professionals believe that law enforcement and prosecutors do not understand the difference in responding to or prosecuting organized retail crime cases versus shoplifting incidents. This lack of awareness can be corrected when Loss Prevention leaders actively work to make stronger organized retail crime cases.
How to begin protecting your business from organized retail crime
Appriss Retail is dedicated to partnering with retailers to end the impact of ORC. Appriss Retail’s Secure Incident + ORC Intelligence is a product designed to enhance the fight against organized retail crime. It enables retailers to add and manage cases related to fraud and abuse, utilizes automated case-linking technology to connect related incidents, and facilitates seamless collaboration and case-sharing with law enforcement agencies. It’s a one-stop-shop solution that continues to grow and update as the threats of organized retail crime continue to morph and change.
Learn more about how to combat organized retail crime through advanced consumer linking.
