Imagine a retailer in your town...This retailer has a structural hierarchy just like yours. There are managers who oversee operations and train new employees. There are employees who obtain the product. There are employees who price, merchandise, and sell the product. There are even employees marketing the business in the community. Imagine this retailer was selling the same product as you. They are rapidly growing, attracting new customers and employees every day, have multiple locations, and most of their competition is completely unaware they even exist.
Now imagine this retailer is selling your product for fifty percent less than what you do, has an astronomical profit margin, and is generating more money than your business. Sounds pretty hard to compete with, right? Well, you’re probably breathing a sigh of relief that this is an imaginary scenario. But, it’s not. There’s probably a retailer just like this in your town that you didn’t even know existed. What’s worse is that product they are selling for so much less than you might have come directly from your store.
Who Are They?
They are organized retail crime (ORC), and they cost the retail industry 30 billion dollars a year. They are highly efficient groups who professionally shoplift, and then sell that stolen product out of flea markets, apartments, or online websites for significantly less than the retail price. While you may have heard the term ORC before, you probably have never heard them referred to as a retailer or business. But in every sense, that is just what they are. Think of them as having every characteristic of your business. Structure, training, employees, and bottom lines. They know their business as well as you know yours, and they are very good at it. How Do They Operate?The lifeblood of any ORC group is stolen merchandise. These organizations know what product is selling at what times and usually seek to exploit that. Typically, they will send a group of two to four individuals with a list of product, who will work for eight to ten hours a day shoplifting merchandise from various stores. They can typically hit ten to twenty stores a day for thousands of dollars each. Remember, these aren’t your typical shoplifters. They are specially trained to use group tactics and get the most merchandise in the least amount of time possible. It’s very possible for them to have hit your store and you not even know it. Remember, this is their profession, and they are skilled at it.
After the merchandise is stolen and sold, the money is used to pay the shoplifters, and to grow the group. Often these groups are using that cash for other ventures such as dealing in illegal drugs or stolen weapons. How Do We Compare?The key to protecting your business and beating organized retail crime is preparation, procedure, and communication. You want to make your business a hard target for these groups. The goal is to make them feel like their exposure is too high in your store so they go somewhere else. Here are a few tips to make that happen: