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Looting wreaks havoc on U.S. stores


Highlights: Looting wreaks havoc on U.S. stores. Organized store robberies skyrocket and the sector already figures the losses due to robberies at 112,000 million dollars. Groups of young people stormed downtown Philadelphia businesses on Wednesday. Dozens of stores, including Apple, Foot Locker and Lululemon, were looted. That same day of the looting of Philadelphia, the chain of supermarkets and hypermarkets Target announced the definitive closure of nine establishments due to the rise of violence and robberies in recent months.

Organized store robberies skyrocket and the sector already figures the losses due to robberies at 112,000 million dollars

Groups of young people stormed downtown Philadelphia businesses on Wednesday. Dozens of stores, including Apple, Foot Locker and Lululemon, were looted. Police acted and there were dozens of arrests, but similar incidents have been repeated in some large cities in the United States in recent months. A name has been coined, smash and grab. Break and grab, literally; looting or lightning robberies, according to their meaning. On many occasions, assaults are carried out with total impunity, in broad daylight, with stores open, due to the helplessness of employees and without the police arriving in time to intervene.

That same day of the looting of Philadelphia, the chain of supermarkets and hypermarkets Target announced the definitive closure of nine establishments due to the rise of violence and robberies. The day before, on Tuesday, the National Retail Federation of the United States had warned of the rise of organized crime against stores and estimated the losses of commerce due to robberies of all kinds in a record of 112,000 million dollars (about 106,000 million euros, at the current exchange rate) in 2022.

Social media is full of videos of looting, many of them on the West Coast, with the Los Angeles and San Francisco/Oakland metropolitan areas as a frequent scenario. In one August, a group of 30 to 50 hooded men broke into the Nordstrom store in Topanga, northeast of Los Angeles, and took luxury goods such as designer handbags worth between $60,000 and $100,000, according to police. The hooded robbers used a bear repellent spray to keep security employees away from the store. Images showing assailants razing everything went viral.

Breaking News: A smash-and-grab robbery shocks LA! Police are seeking up to 30 suspects after a major heist at a Nordstrom store inside Westfield Topanga Mall around 4:15 pm on Saturday (8/12)

— Los Angeles Magazine (@LAmag) August 13, 2023

Eric Nordstrom, Nordstrom's CEO, was asked about the incident days later on a conference call with analysts. "What happened in our Topanga store is disturbing for all of us. Theft losses are at all-time highs. And I would say that we find it unacceptable and it needs to be addressed. That said, while unacceptable, it is within our plans. We have not seen a continued increase in losses that has exceeded what we had planned," he said.

Despite what Nordstrom said, thefts are exceeding most forecasts. "Our profitability in the second quarter was below our expectations due in large part to the impact of the high stock depletion, an increasingly serious problem affecting many retailers," Lauren Hobart, CEO of Dick's Sporting Goods, a group specializing in sporting goods with more than 850 stores nationwide and an annual turnover of more than of 12,000 million dollars. Hobart referred to "retail organised crime and shoplifting in general" as "an increasingly serious problem affecting many retailers". "The number of incidents and the impact of organised crime on retail were significantly higher than we had anticipated," added Chief Financial Officer Navdeep Gupta.

Foot Locker CFO Michael Baughn also warned in his call to analysts: "We continue to see elevated levels of decline." In the sector, euphemisms such as losses or unknown loss are often used, which includes loss, loss due to deterioration and theft, both external and employee. But more and more companies prefer to call the phenomenon by its name. In announcing the closure of nine stores (three in Portland, three in the San Francisco and Oakland area, two in Seattle and one in New York), Target stated, "We cannot continue to exploit these stores because theft and organized crime in retail threaten the safety of our team and our customers."

Previously, in his presentation of results, Brian Cornell, president and CEO of Target, had already denounced "an unacceptable amount of theft and organized crime in retail." "And, unfortunately, the security incidents associated with theft are going in the wrong direction. In the first five months of this year, our stores recorded a 120% increase in incidents of theft with violence or threats of violence," he explained.

Waves of robberies

That type of looting or lightning robbery, especially violent ones, are what have set off the social alarm. They are not entirely new. They arrive as they are produced: quickly and seasonally. California suffered an intense surge towards Christmas 2021. This led the governor, Democrat Gavin Newsom, to promise to invest about $300 million in security over three years. Authorities focused on increasing the presence of police in shopping malls and businesses that have been looted, such as jewelry stores.

The five cities or metropolitan areas most affected by organized crime episodes are Los Angeles, San Francisco/Oakland, Houston, New York and Seattle, according to the sector's employers. The first two are in California. In mid-September, Newsom recalled that he still has about $267 million that he will give to 55 police departments and sheriff's offices. The money is intended to fund investigative teams and bolster the number of police officers in the fall, the peak commercial season.

Conservatives argue that the proliferation of assaults in California is the result of the passage in 2014 of Proposition 47, which made some property crimes less serious if the perpetrator did not have a criminal record, in order to relieve the overcrowded prisons of the state, the most populous in the country.

Activists in favor of penal reform, such as the American Civil Liberties Union (ACLU), argue that the proposal is not responsible for the increase in this type of theft. According to California law, anyone who steals items worth more than $950 will have committed a felony. In Washington state, where similar episodes have also been recorded, the cap is even lower, $750. Texas and other states have a higher ceiling, up to $2,500, for classifying low-value crimes.

Increase in property crime

California Democratic authorities argue that no one who commits such crimes goes unpunished, as Republican politicians claim the region is soft on its dealings with crime. Last year, 2,313 property crimes were committed, an increase of 6.2% compared to 2021. Rob Bonta, the state attorney, tried to look at it optimistically, saying this summer that the figure was far from the all-time high of 6,800 documented in 1980.

The phenomenon is not limited to California. "Retailers are seeing unprecedented levels of theft along with rampant crime in their stores, and the situation is becoming increasingly dire," NRF Vice President of Asset Protection and Retail Operations David Johnston said in a statement. "Far beyond the financial impact of these crimes, violence and safety concerns remain the priority for all retailers, regardless of size or category."

Businesses have experienced a dramatic increase in economic losses due to theft. In 2022 they accounted for 112.100 billion dollars, compared to 93.900 billion in 2021, according to the 2023 National Retail Safety Survey published this week by the sector's employers. The figure includes both external thefts and thefts from the employees themselves. The study also says that with violence on the rise, more and more retailers are choosing not to intervene to stop thieves. 41% of respondents state that no employee is authorized to stop or stop thieves.

Companies are beefing up their security teams, hiring more guards, storing increasingly low-value merchandise in lockable boxes, and capping and limiting store entrances and exits to prevent looting. At the moment it is not enough. In the face of crime, 30% of companies have chosen to reduce or vary the selection of products in stores, 45% have cut hours and there are 28% who, like Target, have opted for the most drastic solution: close stores. Although more drastic is the vision of Donald Trump, exposed this Friday at an event in California: "Very simple, if you rob a store, you can expect to be shot when you leave. Shot!"

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Source: elparis

All business articles on 2023-10-01

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