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LOSSPREVENTIONMEDIA.COM
Organized retail crime associations (ORCAs) across the nation are working diligently to enhance investigations and build cooperative relationships in the battle against organized retail crime (ORC). Considering the growing impact on our retailers and our communities, these critical organizations underscore an increased effort on the part of retailers, law enforcement agencies, retail associations, and district attorneys to work together to confront organized retail crime issues at the local, state, and regional levels.
As emphasized as part of the recent National ORCA Leadership Conference, communication and information sharing are at the heart of this mission, but finding the right technology tools that support these diverse needs and are user-friendly, efficient, highly secure, and affordable is a tremendous challenge for these important groups that often operate on limited budgets. These types of solutions require exceptional partners with means and resources to provide an effective and secure platform, and those that understand the mission and are willing to work with the ORCAs to bring it all together.
As part of our ongoing support for the Organized Retail Crime Associations (ORCAs) across the nation, LP Magazine hosted an ORCA Technology Innovation Summit on Wednesday, September 16th, bringing together ORCA leadership teams to meet in a closed session with controlled access. Six solution providers that offer data management, data sharing, and data analytics were invited to attend. Some offer artificial intelligence, some with facial recognition, and all with capabilities to meet the critical needs of the ORCAs and their membership.
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LP Team Finds Value in Clichés as It Takes Aim at ORC
By Garett Seivold
Professional buzzwords and clichés can be eye-roll inducing, but there is good reason why “buy-in” and other management mantras become popular. Especially when building a team from scratch, they often are exactly what is needed. By Loss Prevention Media Staff The magazine website, LossPreventionMedia.com, offers readers daily breaking news, industry surveys, videos, press releases, case studies, and original articles from LPM writers and loss prevention contributors. The website is updated daily with the latest information included in our daily e-newsletter. Sign up at LossPreventionMedia.com/subscribe for free to add your email address to receive our newsletter and other digital offerings.
“Two-and-a-half years ago, organized retail crime was not part of our vocabulary,” explained John Goldyn, senior director of loss prevention at Ulta Beauty. But as the retailer quickly grew, so did their losses. Theft of high-demand, easy-to-resell products were beginning to have to a material financial impact. “We started to get really concerned about the John Goldyn rise in ORC groups at the store level,” said Goldyn.
The company’s journey to support stores in the fight—to help them manage the difference between shoplifters and professional criminals—followed a traditional management roadmap to success.
Building an ORC-fighting capability at Ulta Beauty began with the collection of financial data that allowed LP to distinguish between theft types, so it could relate the story of how professional criminals differed from shoplifters. “One of our first jobs was to let everyone know how it affected us,” Goldyn explained. “Good intel is needed to set the stage to secure support of the stores and to sell the idea to the C suite.”
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True Cost of Fraud Study Finds 7.3 Percent Increase for US Retailers
By Loss Prevention Media
The 11th annual LexisNexis® Risk Solutions 2020 True Cost of FraudTM Study: E-commerce/Retail Report surveyed risk and fraud executives at e-commerce and retail companies in the US and Canada and reveals that fraud continues to increase and most acutely affects mid- to large-sized e-commerce retailers and merchants. Retailers experienced increased online and e-commerce fraud volumes and monetary losses correlating to a mass shift to online and mobile transactions during the COVID-19 pandemic.
The result of increased fraud volumes translates into a 7.3 percent increase in the cost of fraud year-over-year for US e-commerce and retail merchants. The LexisNexis Fraud MultiplierSM shows that every $1 lost to fraud now costs companies an additional $3.36 compared to $3.13 in 2019
and $2.40 in 2016—an increase of $0.96 over five years. US costs are significantly higher than the cost that Canadian retailers face per $1 lost to fraud at $2.87.
The True Cost of Fraud Study is a comprehensive survey that compares fraud rates, impacts, and challenges related to fraud detection and prevention year-over-year and during COVID-19.
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COVID-19, Social Unrest, and Shoplifting
By Caroline Kochman
Mask wearing is a surprisingly polarizing idea for Americans. Conflicts, which often occur in the retail setting, have escalated to physical confrontation and even murder. Masks are key to stopping the spread of coronavirus, but a lack of consistent guidance, much less laws requiring or governing their use, creates dangerous conflicts in retail stores. Caroline Kochman
Conversely, shoplifting, which creates daily conflict in stores, is a crime in all fifty states. Theoretically, the response to shoplifting is not about guidance, politics, or policy; it is about the law. Yet the same inconsistency abounds—inconsistency in the widely varying policies and responses that exist from retailer to retailer, police department to police department, and prosecutor to prosecutor, irrespective of state law. These inconsistencies lead to increased incidents of theft and dangerous encounters in and around retail stores.
Achieving the needed consistency in the criminal justice response and policy on shoplifters will, like the mask issue, be an arduous, politically charged public process. However, retailers have sole discretion in modifying their internal policies on apprehension and prosecution for first-time offenders as changing conditions require, just as many have recently done with mask-wearing policies.
Further highlighting the importance of consistence in both policy and execution of policy was the killing of George Floyd at the hands of a police officer responding to an alleged retail theft. This tragedy not only touched a nerve in our nation but also prompted virtually every retail CEO to renew their commitment to diversity, inclusion, and opportunity in their stores and the wider community. It shined an even brighter light on an overburdened system that is far more gravely broken than we knew or acknowledged.
The unfortunate reality is that social inequities still exist in both our policing and criminal justice systems and fixing them will be a long time in the making—just as correcting inconsistency of public policy will be. However, as so many retail CEOs recently suggested, retailers have a unique opportunity, even a social responsibility, to bring about change. In terms of low-level shoplifters and the engagement of police, the retail AP/LP industry has the power to employ a modern and innovative response based in education and opportunity over police and punishment, something that is now more relevant and reasonable than ever.
Read the full article on LossPreventionMedia.com.
A Video Surveillance Case Study in Failure
By Garett Seivold
It’s easy to find case studies that describe how a video surveillance project helped to “transform” a retailer’s operations. How a new camera system has lowered their costs, maximized efficiency, or enhanced safety. Axis Communications has an entire book of them.
Market analysts expect organizations to increasingly be lured by the prospect of harnessing video’s power, especially as artificial intelligence (AI) improves analytics and turns images into a wide range of useable intelligence. Nearly 85 million cameras will be active in the US by 2021, according to IHS Markit’s Video Surveillance Installed Base Report. That is about one camera for every four people.
Security device makers and installers routinely push out client case studies to advertise how well these projects go. They walk you through how this corporate headquarters, or that warehouse, effectively rolled out a new system, itemizing innumerable security benefits and quoting happy stakeholders. These accounts have merit: they offer valuable insight on project management and demonstrate how technology is addressing real security and loss prevention challenges. Since the focus is always on the value of technology projects, however, they’re never useful as a cautionary example. But the fact is that security projects can—and do—go horribly wrong, as one did for a group of libraries in the Pacific Northwest.
While not a retail case study, the countywide library system has a structure akin to a regional retailer’s, with a central branch and forty-six individual locations and 1,200 employees. Presented at an information security conference, the study, A Retreat from the Panoptic: One Public Library’s Experience with Video Surveillance, noted that the project ended with the library system ripping out all the cameras it had installed.
Read the full article on LossPreventionMedia.com.
1on1 with Read Hayes of the Loss Prevention Research Council | Ep. 35
By Jack Trlica
The Loss Prevention Research Council (LPRC) at the University of Florida plays an important role in the retail loss prevention industry, providing evidence-based research that is used by retail executives to help them choose technology and strategies to reduce loss and increase retail sales. In this interview with Dr. Read Hayes, the LPRC’s managing director, listeners will learn how the LPRC came into being and how it has evolved over the past two decades.
Listen to the podcast on LossPreventionMedia.com or your favorite podcast platform.
