NRF VP of AP Calls for Legislation to Fight ORC
NRF Crime Czar: 'People Believe it's OK to Steal'
David Johnston’s tenure as the National Retail Federation’s anti-theft czar, as it were, could not have begun at a much more challenging time.

With the wave of retail theft sweeping the nation, industry terms like “organized retail crime” and “smash and grab” are now part of the common parlance. And retailers scrambling for answers and support turn to NRF for both.

“The first month I walked in to a busy and difficult time in retail,” said Johnston, a 30-year veteran in loss prevention and corporate security, who began the job of NRF’s vice president of asset protection and retail operations on Nov. 1. “It’s the holiday season, Covid is still impacting many businesses and there most certainly is an increase in violent theft.”

Theories abound as to why shoplifting has gone from an annoyance retailers would calculate into their expense lines to an existential threat to brick and mortar business. To Johnston’s mind, the cause of it all starts as a disease in the collective soul.

“I think there’s been a change in morality where people believe it’s OK to steal. More and more you’re seeing in the media videos of individuals, or large groups stealing mass quantities and threaten or commit violence against retail employees and it’s becoming more visible to the everyday person,” Johnston said. “It’s definitely a threat [to brick and mortar stores]. It’s not every day you hear Walmart and Target and other major retailers in their earnings calls and in interviews with the press converse about their losses. And it’s not just the major retailers; this is impacting small businesses as well. We’re seeing businesses closing from Mainstreet USA to the malls.”

While the fear and frustration have many calling for a rollback to the days of law enforcement and store security treating shoplifters more assertively, Johnston says the key to a long-term solution starts with Congress passing sound and actionable legislation.

The Combatting Organized Retail Crime Act, introduced in the House by two Democrats and two Republicans in mid-October, aims to get governmental leaders, law enforcement and retail owners working together on a “cohesive national strategy.”

The act would also take aim at the root of the problem: the ease with which thieves liquidate their loot.

Today, the ease and anonymity of selling on the internet makes ‘fencing’ much easier, and, Johnston says, it’s something addressed by the CORCA bill, as well as the INFORM (Integrity, Notification, and Fairness in Online Retail Marketplaces) Act, which passed the House on Nov. 17. It appears to be on its way to passage in the Senate, as it is attached to military funding in the National Defense Authorization Act.

The CORCA bill, which Johnston doesn’t expect to see a vote on until after the next Congress is sworn in, gives authorities more resources and greater opportunity to cooperate on tracking interstate, and increasingly, international crime.

Johnston reminds that the solution to the problem can’t be government’s alone to solve. Retailers need to realize they’re all in this together.

“Retailers are doing a very good job with each other to tackle the issue. There is no competitive advantage here—we all want to make sure the industry is protected,” Johnston said. “We need collaborations between retailers and law enforcement as their own individual entities, but also collaborations between the public and private sectors, in general.” sourcingjournal.com

California New Criminal Justice ORC Laws Jan 1

Retail theft: AB 1700 sets up a section on the state Attorney General’s office website to report stolen items.

AB 1700, Maienschein. Theft: online marketplaces: reporting.

Existing law, until January 1, 2026, makes a person guilty of organized retail theft if the person acted in concert with one or more persons to steal merchandise from one or more merchant’s premises or online marketplaces with the intent to sell or return the merchandise for value, as specified. Existing law requires the Department of the California Highway Patrol to coordinate with the Department of Justice to convene a regional property crimes task force to identify geographic areas experiencing increased levels of property crimes and assist local law enforcement with resources, such as personnel and equipment.
This bill would require the Attorney General to establish a reporting location on its internet website for individuals to report items found on online marketplaces, as defined, that they suspect are stolen goods, and would require the Attorney General to provide that information to the applicable local law enforcement agency and regional property crimes task force. The bill would additionally require online marketplaces to display on their electronically based or accessed platform a link to the Attorney General’s online marketplace suspected stolen goods reporting location.

AB 2294 gives law enforcement the ability to keep those in custody who are accused of organized retail theft.

AB 2294, Jones-Sawyer. Diversion for repeat retail theft crimes.

(1) Existing law requires a peace officer to release a person who has been arrested for a misdemeanor after securing that person’s promise to appear, as specified, unless certain conditions are met for nonrelease, including, among others, there is reason to believe that the person would not appear as required or there was a reasonable likelihood that the offense or offenses for which the person was arrested would continue or resume.
This bill, until January 1, 2026, would include in the reasons for nonrelease that the person has been cited, arrested, or convicted for misdemeanor or felony theft from a store in the previous 6 months and that there is probable cause to believe that the person arrested is guilty of committing organized retail theft. By increasing the number of persons subject to detention in county jail, this bill would impose a state-mandated local program.  leginfo.legislature.ca.gov

How to Stop Serial Returns From Damaging the Bottom Line
Retailers need to reimagine their return policies and create dynamic systems that identify and stop fraud while creating a flexible model to look after their best customers appropriately.

Some retailers have tried tightening return policies across the board by charging for returns or shortening return windows. This approach threatens the trust established with loyal customers and risks alienating high-value shoppers who deserve a flexible returns experience. The solution to this challenge is to provide a highly flexible return policy which tailors itself to offer an individualized experience to each customer. Not all consumers shop the same and therefore not all consumers should be constrained by a one-size-fits-all policy of when and how they can return goods.

Identify Fraudulent Transactions

According to the same NRF and Appriss Retail survey, 89 percent of returns were due to legitimate reasons while roughly 11 percent were fraudulent. The key to protecting profits is to identify fraudulent returns quickly and across any retail touchpoint and take action in real time, whether it’s in-store or online.

The best way to combat fraud is to take an omnichannel, artificial intelligence-driven approach that identifies patterns in behavior and makes real-time recommendations for stopping fraudulent transactions in their tracks.

Modify Your Return Policy to Increase Loyalty

Machine-driven AI techniques can evaluate countless data points in immediate time frames, making nonbiased recommendations which would be impossible for humans to replicate. By implementing a dynamic solution, good customers benefit from relaxed return constraints and retailers benefit by avoiding the losses associated with fraudulent activity. The cost of implementing this technology is more than offset by the savings earned by stopping the losses associated with fraudulent and abusive activity.

A dynamic approach to return policies makes this ideal a reality and gives retailers the control they need to stop return fraud without risking valuable customer relationships.

Nathan Smith is the senior vice president of product at Appriss Retail, a fully integrated omnichannel retail return solutions, providing retailers with a holistic CX view.

Big Easy Bust: CBP’s $29.5M Seizure Keeps LV, Gucci, Dior Fakes Off the Market
The New Orleans Field Office ports seized $29.53 million worth of counterfeit goods between Jan. 1 and Nov. 30.

The field office predominantly seizes counterfeits in the express consignment environment, with counterfeit luxury clothing and electronics making up the bulk of the seizures. While large express consignment operations can net large-valued seizures in single incidents, the majority of counterfeit seizures come in smaller, targeted operations, according to Customs and Border Protection (CBP). sourcingjournal.com

A Big Win for Labor Unions - Removing the Fear of Joining
NLRB increasing penalties for companies that fire workers over union activity
Companies that fire or demote workers as a result of union organizing activity may find themselves responsible for the financial consequences of their action on individuals who rack up late payment fees, healthcare costs and more. “Employees are not made whole until they are fully compensated for financial harms that they suffered as a result of unlawful conduct,” said Lauren McFerran, NLRB chair.

“Fear of retaliation and dismissal is the primary obstacle stopping workers from getting involved in union organizing campaigns,” said John Logan, a professor of labor studies at San Francisco State University. “Increasing the currently meaningless penalties for terminating workers is the most obvious thing to fix that.”

The agency can also collect these penalty payments when employers illegally demote employees, cut their wages or otherwise retaliate.

This year has seen a surge of first-time union victories at companies, such as Amazon, Trader Joe’s, Chipotle and Apple that have long evaded unionization, as well as a 53 percent uptick in filings for union elections nationwide. But union organizers say these efforts have been met with widespread retaliation from employers.

The ruling arrives under the recommendation of the labor board’s top legal counsel, Jennifer Abruzzo, appointed by President Biden, who has expanded the agency’s tool kit in some unprecedented ways and could be the president’s best shot at being the most pro-labor president in U.S. history. washingtonpost.com

Recession concerns lessen as prices decline and Americans spend
Concerns about a potential recession have begun to ebb as recent economic reports show inflation moderating and consumer purchasing remaining strong.

A number of signals this week are pointing to calmer waters ahead. The question is whether we’ve made it past the worst of things or if we’re simply in the deceptively sunny eye of the storm.

Price increases in the United States cooled more than economists expected last month, recording the lowest level of growth since last December. Annual inflation in November was 7.1%, down from 7.7% in October

“There’s growing evidence that the worst of the inflation scare may be in the rearview mirror,” he wrote in a note on Tuesday.

Recession fears are also ebbing a bit. The economy is cooling in some sectors — housing has taken a hit, manufacturing is slowing and consumer and business confidence are lower. But Americans have proved resilient. They’re still spending and the job market remains healthy. A soft-landing is not a given, but the runway appears wider than it did a few months ago. cnn.com

Macerich Mall Owner CFO: seeing signs of the “most normal holiday season” in three years
“In 2021, we saw things limping back to normal but people were still cautious,” he said in an interview with CFO Dive. “There is a return of families back to centers, with lines for Santa photos. Parking lots are full, and there are a lot of people shopping.”

The company announced on Nov. 3 a 95% increase in foot traffic year-to-date for the third quarter, with levels back to those of pre-pandemic times driving tenant sales 5% above the same period in the year-earlier and 13% higher than the same span of 2019. cfodive.com

Walmart Taking Robotics One Step Further Than Amazon
Walmart sees automation as the future

CEO predicts big decline in labor costs as warehouses adopt robotics, implement inventory optimization

Speaking at the 2022 Morgan Stanley Global Consumer & Retail Conference, McMillon said that robotic warehouses, in which goods are moved by unmanned wheeled carts, will not only reduce the need for workers in the warehouses themselves, but also in the stores where the goods are received.

In the future, he said, products will be delivered to stores on pallets that have been organized according to that store’s particular layout, category by category, so that employees can stock shelves efficiently directly from a pallet, rather than carting boxes of individual products back and forth from a back room.

“It’s a different process, eliminating a lot of hours that we invest in in the back rooms of our stores,” McMillon said.

Over the coming years, combining those kinds of robotics with inventory optimization technologies and predictive sales analytics will drive costs out of the system, he said. supermarketnews.com

Talk About Brand Reputation & Ethics
Your merchandise was made in a sweatshop. Now what?

When it comes to supply chain ethics, retailers may no longer be able to cede responsibility to the brands they sell.

Last week, the U.S. Department of Labor, as it often does, issued a press release noting that officials had ordered a Los Angeles-based garment manufacturer to pay back wages after the factory illegally withheld pay and overtime pay from its workers. In it, the department mentioned three retailers connected to the incident: Evereve, Indigo and Stitch Fix.

The differing reactions from the retailers demonstrate that there’s no clear protocol in the industry when brands they sell get caught up in labor and safety infractions at garment manufacturers. It’s a stubborn problem usually seen overseas but also endemic in Los Angeles, now the country’s textile center.

But it’s naive for a retailer to think it can walk away from the conversation just because they don’t run the factory or even the brand involved, according to Alison Taylor, executive director of the Ethical Systems program at New York University’s Stern School of Business.

“If I’m a retailer, I’d want to have a conversation with the brand and feel comfortable they were tackling it,” she said. “I’m not sure we need more people piling into this factory and investigating everything. But I would want to know they are dealing with it. I would want to hear them explain to me what they’re going to do about it, and then I’m probably going to keep an eye on it.” retaildive.com

NY Air National Guard member dies snowboarding at American Dream Mall indoor slopes

New York enacts workplace breastfeeding law for Ney York employers


Quarterly Results

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