Organized theft is turning San Francisco into retail’s wild west

Discussion
Photo: Getty Imagers/Animaflora
May 25, 2021

Recent reports depict a battle going on in San Francisco between retailers and organized retail crime, and the thieves are winning so convincingly that stores are closing their doors rather than trying to keep up a losing fight.

The New York Times reports that the city’s board of supervisors heard last week from representatives of Walgreens who said that the number of thefts at its San Francisco locations was four times that of the average for the chain across the U.S. The drugstore giant has closed 17 stores in recent years, largely as the result of being unable to curtail profit-destroying thefts.

Brendan Dugan, director, Organized Retail Crime & Corporate Investigations at CVS Health, told the Times that San Francisco is one of the most troublesome markets in the country for the retailer when it comes to thefts at stores.

The threat of violence has led CVS to instruct its store security personnel to refrain from pursuing suspected thieves. Mr. Dugan said the chain has seen its security officers “assaulted on a pretty regular basis” in the city.

There appears to be plenty of blame to go around when it comes to organized retail crime run amok in San Francisco, from limited legal consequences for first-time and repeat offenders and the lucrative nature of the illegal trading, primarily done via online platforms, such as eBay.

As bad as San Francisco is, it is not the worst city in the U.S. or even California when it comes to organized retail crime. The National Retail Federation’s (NRF) “Organized Retail Crime Survey 2020” ranks the city by the bay at number five on its list.

Los Angeles tops the ignomeous, list followed by Chicago, Miami and New York. Right after San Francisco come Baltimore, Atlanta, Washington, D.C., Philadelphia and Sacramento.

Criminal activities at retail cost retailers an average of nearly $720,000 for every $1 billion in sales, according to NRF.

The scope of organized criminal acts has broadened in recent years, with three in four retailers surveyed by NRF between February and April of 2020 reporting an increase over the preceding 12 months. The value of what thieves steal was also going up, according to two-thirds of respondents.

DISCUSSION QUESTIONS: Is the depiction of retailers in San Francisco fighting organized retail crime confined to particularly “bad” neighborhoods in that city or is it a problem across the country regardless of where stores are located? What are retailers and others doing to address the issue and what else needs to be done to thwart this criminal activity in a substantial way?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"The first point of resolution needs to be rooting out the organized gangs, prosecuting and getting them off the street."
"I hate to see stores closing due to uncontrollable levels of theft because I believe that with every store closed the problem for the community gets worse."
"The “no bail,” “reduce police presence,” etc. clustering of beliefs that seem to typify so many of our cities’ leaders is just so destructive…."

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14 Comments on "Organized theft is turning San Francisco into retail’s wild west"


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Neil Saunders
BrainTrust

I get the feeling that shoplifting is sometimes seen as a minor crime that has few consequences. However it isn’t. There are a load of negative externalities from violence against staff to the closing of stores which reduces choice and economic vibrancy in affected areas. And those problems have become heightened in recent years as shoplifting has become more of an organized crime activity. The first point of resolution needs to be rooting out the organized gangs, prosecuting and getting them off the street.

Ben Ball
BrainTrust

Great idea Neil. I completely agree. But it is going to be difficult to “get them off the street” when California voters passed a proposition in 2014 reducing non-violent theft of less than $950 value to a misdemeanor from a felony. These days, felons don’t get time and misdemeanors don’t even get to court. You get what you incent (or do not dis-incent).

Joel Rubinson
BrainTrust

Thank you for this comment. This is part of the reverberating effects of going soft on crime. The “no bail,” “reduce police presence,” etc. clustering of beliefs that seem to typify so many of our cities’ leaders is just so destructive….

Bob Phibbs
BrainTrust

The trouble is, who is responsible for fixing it? Decriminalizing shoplifting could not have helped the situation and the massive homeless problem in California’s major cities have to play a part. Not to sound too Tipper Gore but the movies have shown people shoplifting and getting away with it for decades. It was 20 years ago Winona Ryder was caught shoplifting and made an example of. Maybe more coverage of the catch versus romance of the act would be helpful.

Dr. Stephen Needel
BrainTrust

When the value of what is stolen is less than one-tenth of a percent of sales, it’s hard to imagine retailers are going to put a lot of effort into stopping this. Either absorb the cost or close the store if it’s too dangerous to be there. I don’t like saying that – it’s why we get retail deserts – but a company should only put up with so much. If the community can’t help protect them, then accept it or leave.

Gary Sankary
BrainTrust
In my years at Target, organized retail crime was such a problem that it was one of the only places where our teams collaborated closely with all of our competitors, including Walmart. To be clear, these shoplifters are organized groups with specific targets, both in terms of products they want and the stores they hit. This is not your high school dropout swiping a few things on a trip to the store. Retailers, as the article points out, are erring on the side of safety for their teams, which I applaud. The down side of course is these gangs take advantage of this and use intimidation as a tactic. The best solution is cooperation between retailers and law enforcement. One tactic I’ve seen, here in the Twin Cities, is a network of asset protection managers for all the major retailers. They would meet monthly and share observations. More importantly they also created a sort of early warning system. Whenever one store was hit, the managers would alert their peers and law enforcement around town. By… Read more »
Liz Crawford
BrainTrust

Unfortunately, this coincides with a surge in gun violence as well. Overall there is a shift in the zeitgeist regarding violence and crime. Retailers can’t handle this problem alone. Retailers need to work in concert with police and the FBI to combat the rise in theft, as well as assault. I wish I had the answers here – but it is a complex, multifaceted social issue.

Matthew Brogie
BrainTrust
25 days 6 hours ago

The scary part about this conversation is around the word “organized.” It is no longer simple shoplifting when the effort is organized and coordinated. While related, the drive to steal a bag of peanuts to eat is far different from grabbing as many $10 cosmetics as possible to sell on the street. Solving these two disparate problems takes very different approaches, the former having a more social lean and the latter delivering more harsh consequences to perpetrators.

I hate to see stores closing due to uncontrollable levels of theft because I believe that with every store closed the problem for the community gets worse. There is, however, a limit to a business’ responsibility to the community vs. its responsibility to employees and shareholders. When employees are endangered or the alternative is free-for-all looting there is no other choice but to shut down.

Harley Feldman
BrainTrust

The organized retail crime seems to be widespread and is not just confined to “bad” neighborhoods, and it appears to be in many big cities. The retailers will need help fixing this problem including tougher penalties, restricting District Attorneys from quick release of guilty offenders, and more in-store surveillance by private services of the local police.

storewanderer
Guest
25 days 5 hours ago
I have seen this issue firsthand and it is a real problem in San Francisco but also throughout the Bay Area and as noted in this article has even spread to Sacramento. The past year, with a lot fewer daily office workers commuting into the city, convention traffic basically gone, and tourist traffic way down, the problem may be that the shoplifting groups are still there in force, perhaps have even grown, and the situation has come to a head. Target even closed one of its small format stores in the city. Target has some of the best loss prevention and facial recognition technology in retail used to curb organized retail crime. The mask mandates have probably had an impact on the retailers using facial recognition in conjunction with loss prevention programs. More stores will close, period. It is a lose-lose situation for the retailers to try and curb this when the organized retail theft ring gets too strong. Locked cases are a hassle for customers and employees (and shoplifters will just break them open).… Read more »
RandyDandy
Guest
25 days 4 hours ago
I live in San Francisco, and have seen this thievery played out in broad daylight. And, unbelievably, it has been about everything from “grab and go” to actual smashing of windows in parking lots (to obtain a car’s backseat contents). Perhaps what is saddest about this is not so much the thefts themselves, as what it says about our city’s governing institutions and the general population. Purportedly, San Francisco likes to think of its self as welcoming and sympathetic—to all strata of humankind. Which has, in part, come to be characterized as a place that accepts some actions not as crimes so much as allowable ones. Because, well, how bad can a petty theft be if it’s called petty? In a way, there’s something to that argument — if it stayed minor. However, what such allowances have shown is that “to give an inch, they will take a mile,” and these seemingly insignificant acts have grown to dangerous proportions. What this really boils down to is not so much retailers working with law enforcement (though… Read more »
Craig Sundstrom
Guest

In many publications, this would be a cue to launch into a diatribe against SF’s notoriously leftist DA, but a reading would show — as the story itself notes, explicitly — the city is actually far down on the list (so why set the story there?).

With so little info to go on, it’s hard to make much in the way of recommendations.

Kenneth Leung
BrainTrust

Living in downtown SF, I can attest the problem. With quiet streets I am seeing increased store theft, broken windows and doors, etc in my neighborhood. In some cases I don’t blame retailers for closing because previously sales exceeded shoplifting and now I am not sure that is the case. Together with the current disagreement between the DA and police on how to handle property and drug crimes, I see more stores closing in quiet neighborhoods.

storewanderer
Guest
25 days 13 minutes ago
Also and this is not meant to discount the fact that there is a serious problem with shoplifting in San Francisco, but the headline of Walgreens having closed 17 stores — it is important to note that previously Walgreens had upwards of 50 stores in the city. Many small stores within a block or two of another store, some without a pharmacy, so a lot of consolidation has taken place just by virtue of that. Also there has been growth of other retailers in San Francisco including multiple Target locations, new Whole Foods locations, new Trader Joe’s locations, which I think have taken some business from Walgreens around there. Walgreens also quit letting the San Francisco Stores operate under an independent structure some number of years ago; the stores used to get to do a lot of their own buying (some having large grocery sets from Unified Grocers or before that United Grocers), run their own ads, and sell more regional products. This probably didn’t help either. And when you do things that turn customers… Read more »
wpDiscuz
Braintrust
"The first point of resolution needs to be rooting out the organized gangs, prosecuting and getting them off the street."
"I hate to see stores closing due to uncontrollable levels of theft because I believe that with every store closed the problem for the community gets worse."
"The “no bail,” “reduce police presence,” etc. clustering of beliefs that seem to typify so many of our cities’ leaders is just so destructive…."

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