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- The shrinkage rate of Walgreens or lost items from theft and damage has been 50% higher over the past 2 years.
- “These are gangs that actually go into our beauty product stores and empty them,” said CEO Roz Brewer.
- According to a. retailers lost a record $ 61 billion to theft in 2020 National retail association survey.
Walgreens has lost 50% more revenue to theft and damaged items in the past two years.
Roz Brewer, the chairman of the board of directors of Walgreens Boots Alliance, said the company has a shrinkage rate, or loss of inventory due to theft, fraud, and damage at about 3.25%. The rate of contraction was just over 2% 10 years ago, she added.
Brewer said the past two years have seen the shrinkage increase by 40 to 50%, largely due to organized crime.
“This is no small theft,” Brewer said when he called investors on Jan. 6. “There is no one who cannot afford to eat tomorrow. These are gangs that actually go in and empty our stores of beauty products. And that’s a real problem. “
Walgreens reported net income from continuing operations of $ 2 billion for the twelve months ended August 31. With a contraction rate of 3.25%, the company could have lost $ 65 million of its net income to theft last year.
U.S. retailers lost an estimated 1.62% of their sales to shrinkage in 2020, a record $ 61.7 billion National Retail Association.
Retailers said the growth of third-party e-commerce stores has exacerbated retail crime. Two retail spokespersons told Insider’s Ãine Cain that anonymous online retailers can make it easier for thieves to market their loot without arousing suspicion.
Twenty retailers, including Target, Best Buy, and Kroger, have called on Congress to pass laws to curb illegal business activities by anonymous online vendors.
“Not only is their merchandise stolen from the retailer, but someone is competing with them online by selling the same product at half price because it was stolen,” Scott Glenn, Home Depot‘s vice president of asset protection, told Insider. “So it really hits retailers from several directions.”
Some have questioned whether retailers have been honest about the level of retail theft.
The FBI’s crime statistics showed that Burglary, robbery and theft reached an all-time low in 2020 San Francisco Chronicle found that the San Francisco Police Department data does not support Walgreens’ statement that five stores will be closed for organized retail theft. In the shops that are slated to close, there have been “fewer than two registered shoplifting incidents per month since 2018,” according to the report.
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