Judd Legum and Tesnim Zekeria over at Popular.Info do, as usual, great work setting the record straight on what the media inaccurately, without proof, have been covering as the the so-called “shoplifting epidemic” that has been allegedly gripping the nation:
For several years, Walgreens and other major retailers have been sounding the alarm about an alleged spike in shoplifting, describing it as an existential threat to their business. These dramatic claims generated a nationwide media frenzy.
Now, Walgreens is quietly backtracking.
In a conference call with investors on January 6, Walgreens Chief Financial Officer James Kehoe was asked how shoplifting and related problems impacted the company’s financial performance. Kehoe admitted that “maybe [Walgreens] cried too much last year” about the issue, adding that the drugstore chain probably spent “too much” hiring private security companies.
Kehoe added that theft at Walgreens had “stabilized” and the company was “quite happy with where we are.” Walgreens’ “shrink” — an industry term for inventory losses from theft, damage, or administrative errors — had gone down from 3.5% of sales last year to roughly 2.5% in its last quarter. Walgreens declined to specify how much of the “shrink” was due to shoplifting as opposed to other causes, like employee theft and damaged goods. Across the industry, “external theft” accounts for only one-third of total shrink. That means shoplifting at Walgreens likely amounts to less than 1% of sales.
But Kehoe’s upbeat comments gloss over Walgreens’ central role in fomenting the national panic over retail theft. Just a year ago, Kehoe said that part of the reason Walgreens’ reported lackluster earnings was because of “gangs that actually go in and empty our stores of beauty products.”
“This is not petty theft,” Kehoe insisted at the time. “It’s not somebody who can’t afford to eat tomorrow.”
Walgreens has been joined by other major retailers who have been echoing similar cries and drumming up fear: Walmart CEO Doug McMillion warned that Walmart may have to raise prices or close stores because theft was “higher than what it has historically been.” Former Home Depot CEO Bob Nardelli stated on national television that retail theft was “spreading faster than COVID.”
Publicly available data, however, contradicts the theft-wave narrative. The number of shoplifting offenses dropped 46 percent between 2019 and 2021, according to the FBI’s crime data explorer. The National Retail Federation (NRF), a trade group that represents retailers like Walgreens and has amplified the theft-wave narrative, has also found that shrink declined to 1.4% of total retail sales in 2021, from 1.6% in 2020. External theft, the NRF found, made up 0.5% of total retail sales in 2021.
The article continues:
In May 2021, Walgreens told the New York Times “that thefts at its stores in San Francisco were four times the chain’s national average, and that it had closed 17 stores, largely because the scale of thefts had made business untenable.”
Months later, the retailer announced the closure of an additional five stores in San Francisco and told the San Francisco Chronicle that “organized retail crime continues to be a challenge facing retailers across San Francisco, and we are not immune to that.” The company said it had to increase investments in private security in San Francisco by “46 times our chain average in an effort to provide a safe environment.”
When the company announced it was closing five stores in San Francisco due to rampant theft, police data obtained by the San Francisco Chronicle revealed that “the five stores slated to close had fewer than two recorded shoplifting incidents a month on average since 2018.” Moreover, the company’s claims that thefts at its San Francisco stores were four times its national average were not reflected in citywide crime data — in 2020, shoplifting had reached its lowest level since they began collecting data in the 1970s.
Moreover, back in 2019, Walgreens announced it would close 200 stores across the U.S. as part of a larger “cost-reduction” plan. The San Francisco Chronicle, in 2021, raised the question of “whether a $140 billion company was using an unsubstantiated narrative of unchecked shoplifting to obscure other possible factors in its decision.”
The “shoplifting epidemic” played into so much of the right-wing agenda on crime, race — you name it.
The GOP and its willing suckers in the mainstream media could tie the shoplifting narrative into a false indictment of the bail reform movement that likely cost San Francisco DA Chesa Boudin his job. It was also used to bludgeon Democrats in the mid-terms as being responsible for increasing crime when, in fact, most types of non-violent crime, including shoplifting, had been dropping.
To be sure, there were some shockingly brazen shoplifting incidents during the pandemic. But there were also some before and after the pandemic. There have always been brazen shoplifting incidents.
But the statistics prove that the “epidemic” rise of these incidents is simply a false narrative begun by retailers trying to make excuses for bad business decisions, and then helped along by lazy reporters in the mainstream media.