Consumers Are Concerned About Their Favorite Neighborhood Stores Closing Due to Retail Theft, Coresight Research Finds

Consumers are getting increasingly nervous about stores in their neighborhoods closing due to retail crime.

According to a Coresight Research survey conducted with more than 400 U.S. consumers in July 2023, 56 percent of respondents are moderately, very or extremely concerned that some of the stores in their communities could be closed to due increased levels of retail crime and theft.

Recently, several retailers have announced plans to close some stores in areas where crime retail crime has become increasingly problematic. Just last month, Target said it would close nine stores in four major cities as it faces waves of organized crime and theft, a move which inspired anger and disappointment from locals in the area, according to local news reports. Nike also recently closed a store in Portland amid a rise in crime in the area and Nordstrom officially shut the doors on two of its stores in downtown San Francisco, including a flagship location, as crime and safety issues continue to impact the city.

According to recent data from the National Retail Federation (NRF), shrink — or when stores have fewer products than recorded in inventory books largely driven by retail crime — accounted for $112.1 billion in losses, up from $93.9 billion in 2021, when taken as a percentage of total retail sales in 2022. NRF found that internal and external theft together accounted for nearly two-thirds (or 65 percent) of retailers’ shrink in 2022.

According to the Coresight report, mass retailers like Target and Walmart are among those that stores at the most risk to be exposed to theft due to their small, easily concealable and typically lower value products they tend to sell, which can more easily be resold in the secondary market.

In recent quarters, retailers like Dick’s Sporting Goods, Walmart and Target have spoken out about external retail crime bitting into profits in a major way, with some chains announces store closures or increased security measures to combat the issue, such as locking up merchandise.

But according to Coresight data, not all consumers are thrilled with retailers’ potential mitigation tactics. 17 percent of respondents said they would shop elsewhere if their local stores closed and 25 percent said they would shift to online shopping if their stores kept its products locked up.

73 percent said they are are concerned about retailers potentially raising prices to make up for losses from retail theft and 64 percent said they are concerned about their local government’s ability to enforce anti-theft law.

“Beyond its impact on profits, retail theft and organized retail crime can profoundly affect employees, customers and the shopping experience as a whole,” read the report. “Crime-related shrink also influences the broader business environment, including the ability to hire and retain quality employees, the accessibility of goods, and customer footfall.”