Imagine a retailer in your town…This retailer has a structural hierarchy just like yours. Some managers oversee operations and train new employees. Some employees obtain the product. Some employees price, merchandise, and sell the product. There are even employees marketing the business in the community. Imagine this retailer was selling the same product as you. They are rapidly growing, attracting new customers and employees every day, have multiple locations, and most of their competition is completely unaware they even exist.
Now imagine this retailer is selling your product for fifty percent less than what you do, has an astronomical profit margin, and is generating more money than your business. Sounds pretty hard to compete with, right? Well, you’re probably breathing a sigh of relief that this is an imaginary scenario. However, it’s not. There’s perhaps a retailer just like this in your town that you didn’t even know existed. What’s worse is that the product they are selling for so much less than you might have come directly from your store.
Who Are They?
They are organized retail crime (ORC), and they cost the retail industry 30 billion dollars a year. They are highly talented groups who professionally shoplift, and then sell that stolen product out of flea markets, apartments, or online websites for significantly less than the retail price. While you may have heard the term ORC before, you probably have never heard them referred to as a retailer or business. However, in every sense, that is just what they are. Think of them as having every characteristic of your business. Structure, training, employees, and bottom lines. They know their business as well as you know yours, and they are very good at it.
How Do They Operate?
The lifeblood of any ORC group is stolen merchandise. These organizations know what product is selling at what times and usually seek to exploit that. Typically, they will send a group of two to four individuals with a list of products, who will work for eight to ten hours a day shoplifting merchandise from various stores. They can typically hit ten to twenty stores a day for thousands of dollars each. Remember, these aren’t your typical shoplifters. They are specially trained to use group tactics and get the most merchandise in the least amount of time possible. It’s possible for them to have hit your store and you not even know it. Remember, this is their profession, and they are skilled at it.
After the merchandise is stolen and sold, the money is used to pay the shoplifters, and to grow the group. Often these groups are using that cash for other ventures such as dealing in illegal drugs or stolen weapons.
How Do We Compare?
The key to protecting your business and beating organized retail crime is preparation, procedure, and communication. You want to make your business a hard target for these groups. The goal is to make them feel like their exposure is too high in your store so they go somewhere else. Here are a few tips to make that happen:
- A culture of customer service can cure almost anything in business. It’s no different here. These people don’t want to be seen because they don’t want to be identified later. My rule for dealing with suspected shoplifters is to have each associate customer service them five times. Almost every time they will dump the merchandise and leave.
- Utilize your camera system the very best way you can. Where your cameras are pointed is critical. Install public view monitors at your entrance, and over high-value merchandise. This will ensure these groups know their image is being captured. As a bonus, it will make your regular customers feel safer.
- Know your product and utilize the best product protection possible. As added security for clothing, you can criss-cross the hangers of your high-value product. This will keep them from being able to take an entire rack of clothing all at once. Remember, these shoplifters want to spend as little time as possible in your store. It’s all about exposure; If they feel like stealing the merchandise will take too long, they will go somewhere else.
- Lastly, try to network with other retailers in your area. Knowledge is power, and the more we communicate, the better we can all be one step ahead of these groups.
So, are you competing against organized retail crime?Well, yes, in reality, we all are. It’s not a question of whether you have been affected by ORC, it’s a question of WHEN you will be affected. Remember, with proper preparation, procedures, and communication, we can win against organized retail crime.