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The UK Government Cracks Down on Organized Retail Crime

Published April 21, 2024
Published April 21, 2024
Troy Ayala

Organized retail crime (ORC) has become a widely reported issue within the beauty industry, with cases increasing rapidly worldwide. In the UK, incidents of ORC climbed from an average of 827 in 2022 to an average of 1,300 in 2023, with over £953 million ($1.2 million) worth of products stolen during this period. Of these crimes, the police failed to respond to 60% of those reported, with 44% of retailers reporting police urgency as "poor" or "very poor."

Last year, 88 retailers in the UK—including Superdrug, Boots, Sephora, and SpaceNK—signed a letter to then-Home Secretary Suella Braverman demanding action be taken against the rising statistics of retail theft. The retailers called for police forces to record all incidents of retail crime, allowing for better resource allocation to the issue.

Recently, it was announced that a response to the spearheading retailer's letter had been granted. Opal, a team within the UK’s national police's intelligence unit, is set to begin compiling information on ORC groups as part of the government's plan to tackle shoplifting.

Opal will implement training programs for retailers and the police force, teaching them how to correctly gather information and present data surrounding stores' criminal activity. The sessions will take place throughout April and guide retailers on the best strategies for working with the police to ensure crimes are not overlooked.

"Opal has been carrying out this role for other crime types for a number of years and we have seen significant successes from having a national overview of what's happening in the organized crime world," says Stephanie Coombes, Head of Intelligence at Opal. "We know that many retailers have intelligence built up through their own systems and processes and the training sessions aim to demonstrate how they can work with us to share that information so action can be taken."

Opal will provide the police with the resources to properly investigate each incident, ensuring no time is wasted. "We could have several police forces each looking into the same group, so Opal's role is to centralize that intelligence, build a strong evidence package, and then work with the relevant forces to deal with these high harm offenders," adds Coombes.

Opal will help build industry-wide knowledge on the complexities of retail crime, including how to report it and notice the difference between shoplifting and ORC groups. Word of the UK's Opal program comes after several retail experts in the US have raised the concern of a lack of consistent understanding and stored data regarding retail crime, making it harder to tackle.

Mark Skertic, Managing Director of regulatory advisory firm K2 Integrity, spoke on being approached by the National Retail Federation, which requested to work together to tackle the increase of retail crime. "One of the things we immediately realized is that we will never get our arms around [retail crime] completely because there is no database; there's nothing that tells me that a certain number of thefts occurred within a certain store at a certain strip mall on a certain date," Skertic says.

The concern was also raised that retailers reporting to the police need greater clarity around the terms and technicalities of ORC. This is because it has been found that many retailers report loss from general shrinkage as ORC groups, making accurate information on ORC hard to obtain.

Despite a lack of data communication, multiple US retailers have implemented practices by stores to tackle the issue of ORC. In North America, 93% of retailers are utilizing RFID (radio frequency identification) to some extent to keep track of their shrink. RFID technology allows retailers and brands to collect and integrate data on an item's location and movement, the date and time of the sale, the cost of the sale, the loss of the item, and more.

Last year, Macy's RFID technology, utilized to get a better idea of ORC, revealed that, in truth, 60% of shrinkage comes from in-house. The data showed several employees were found walking away with more unpaid merchandise than stores had allowed for. This enabled Macy’s to obtain a broader idea of the extent of external retail crime, making it easier for them to report these cases correctly.

While it is clear that mass efforts are being made to prevent ORC, the approaches taken thus far show that a more comprehensive understanding of store-to-store incidents is needed. The UK's Opal approach will likely help retailers and the police come together effectively to gain this understanding and tackle ORC so that no case goes under the radar. While such a program is tougher to organize in the US becuase many states hold their own laws on ORC and how it is reported, conversations surrounding the technicalities of data collection and industry unification give hope that the industry is moving closer to a cohesive understanding of ORC. Ideally, this  would lead to a similar unified database in the US, making it easier to stand up against crime.


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