I can't let this moment pass: the National Retail Federation (NRF) has retracted its claim that organized shoplifting caused half of inventory loss (commonly called "shrink" in the business).
You may recall the many hysterical news stories earlier in the past year or so about roving gangs of shoplifters stealing everything that wasn't nailed down. In. SAN. FRAN. CISCO! among other places.
Well, while that kind of crime happens once in a while (and it has happened in other places at other times over previous decades), there was no wave of increases across the country.
Unfortunately, many of us have seen bad things happen as a result of the endless drum beat about the supposed increase: stores have been closing off entrances and putting all sorts of goods into locked cases (socks! toothpaste!), which requires shoppers to find one of the few staffers to unlock the case. And then the corporate overlords wonder why sales are down.
State legislatures have also passed laws to increase penalties for organized shoplifting, using dubious definitions. Minnesota recently convicted its first people under such a statute; there were three people who worked together to steal some clothes to resell and get enough money to afford a trip to Mexico. Is that the scale of organized theft anyone has in mind when they think of the cartel-organized smash and grab scare stories? Do those three deserve an aggravated sentence just because a new law exists?
The NRF was either mistaken or hoping to put one over on everyone to flog their cause of increased police budgets and a carceral state, and I suspect the latter. They based their wrongness on Congressional testimony by Ben Dugan, the former president of an advocacy group called the Coalition of Law Enforcement and Retail. Dugan used old information and then misused even that.
I've seen mention of the retraction multiple times, and a few journalists have apologized for being taken in by the NRF, but I don't think I've seen any of them reference the podcast "If Books Could Kill," which made all this clear in their October episode The "Organized Retail Crime Panic":
Do we have any data that can cut through all of this? ...shrink [means] inventory that's either stolen, lost, or damaged. The NRF estimates total shrink to have been about $49 billion in 2016. By 2021: $94 billion. Massive increase, made some headlines in the media. But... shrink as a percentage of sales was actually identical: 1.44%. This is actually the story of retailers doing exceptionally well.
They go on to cite larceny numbers for San Francisco, comparing rates in 2021 compared to 2019 and 2018: it was down compared to pre-pandemic. Of course, in May 2021 larceny was higher than it was in May 2020... because that was the time when a lot of stores were still closed and many people were not shopping. So of course there was more shoplifting in May 2021 than in May 2020. Media coverage that played up increases in larceny year-over-year in 2021 was absurd on its face.
The NRF created the term "organized retail crime" (with its great acronym ORC). Their latest report — the one with the claim that has been retracted — defines it as systemic and large scale, and implies that it is novel. Which seems odd to me, since it includes employee theft and the classic mob concept of "it fell off a truck," which goes way back into the 20th century if not the 19th or earlier.
ORC, the NRF report says, is up but the only data they have is from retailers' self-reports. Each retailer uses its own definition of the term, which is a problem, and some have recently added ORC teams to their staff. That means they're likely to find more of the thing they've recently begun looking for.
And that doesn't even get into the biggest problem of all with the report, which is this whopper: It says that half of all retail shrink is from ORC, but "numbers from their own surveys have reported that external theft (including ORC) is about 37%." So how can ORC be nearly half?
Well, they took their $94 billion estimate for 2021 and compared it to the Congressional testimony of Ben Dugan that ORC costs $45 billion a year and did some math: 45 is nearly half of 94, see?
But where did Ben get that $45 million number? The Los Angeles Times asked him. He said he got it from the NRF. It was their 2015 number for total shrink. So in front of Congress, Dugan "attributed all shrink to ORC, which he knows is not true." All shrink is not even attributable to shoplifting, let alone to ORC. Plus he used the wrong year's data.
At this point, Peter the podcaster said the NRF's statement of the scale of organized retail crime was "a whirlwind Ouroborous of absolute bullshit" and that was the most accurate phrase I heard all week.
Their point, after that, was that journalists should treat claims from the NRF the way they would claims from the Westboro Baptist Church: wait until there's actual evidence. "There are huge, bad-faith actors at the very center of this, and they need to come with actual facts to us.... Until they do, the story is: the retail lobby is trying to push a narrative for which there's no evidence."
Kudos to the LA Times for being one media outlet that had proper skepticism. Their December 2021 story Retailers say thefts are at crisis level. The numbers say otherwise is exactly what journalists should have been writing.
The Times story also says,
One thing that has gone up is the visibility of open theft from stores. Ubiquitous security cameras and smartphones mean that few crimes go unrecorded, and videos of people loading up bags and carts with products and walking out the door make for viral content.
The "If Books" podcasters agree. The virality of videos has fed this panic, and it pays to remember that when the next panic rolls around.
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