Retailers face escalating threats that cost businesses billions annually. From organized crime to cyberattacks, the risks are widespread and evolving. Here’s a quick summary of the top challenges and their solutions:
- Organized Retail Crime (ORC): Large-scale theft by criminal networks. Use AI surveillance, license plate readers, and RFID tracking to deter and detect.
- Employee Theft: Accounts for 29% of shrinkage. Implement AI cameras, access controls, and employee training.
- Cybersecurity Threats: Retail is a top target for phishing, ransomware, and IoT attacks. Solutions include multi-factor authentication, network segmentation, and employee training.
- Shoplifting: Responsible for 36% of shrinkage. Tools like AI cameras, RFID tags, and anti-push-out systems help prevent theft.
- Physical Security Gaps: Poor lighting, blind spots, and unsecured exits are common issues. Use strategic camera placement, better lighting, and access controls.
- Supply Chain Shrinkage: Losses occur during transit and storage. Employ RFID, IoT tracking, and blockchain for end-to-end visibility.
- Workplace Violence: Rising aggression impacts employee safety. Use panic buttons, training, and clear safety policies.
- Regulatory Compliance: Laws like the INFORM Consumers Act require transparency. Use automated verification tools and centralized compliance platforms.
These challenges demand proactive, multi-layered strategies combining technology, employee training, and partnerships with law enforcement. Retailers must act now to protect their businesses and customers.
1. Organized Retail Crime (ORC)
Organized retail crime (ORC) is a complex and large-scale issue involving criminal networks that often operate across state lines and even internationally.
How ORC Works
ORC differs significantly from typical shoplifting. As defined by the National Retail Federation:
"Organized retail crime is the large-scale theft of retail merchandise or digital goods with the intent to distribute and sell the items for financial gain. ORC is often confused with individual crimes and thefts like shoplifting, cargo theft and online frauds; all of these crimes can be in support of ORC groups."
The key difference lies in the scale and organization. These groups rely on "boosters" to steal goods and "fences" to sell them.
Stolen merchandise often flows through various channels, including online marketplaces, flea markets, pawn shops, and even back into legitimate retail stores. The Department of Homeland Security estimates that these activities cost federal and state governments nearly $15 billion annually in lost tax revenue, adding over $500 in additional costs per American consumer.
ORC groups are also tied to other serious crimes such as drug smuggling, human trafficking, money laundering, and identity theft. Their operations often extend beyond U.S. borders, complicating efforts to investigate and prosecute them.
Recent cases highlight the aggressive tactics used by these networks. Authorities have intercepted groups carrying tens of thousands of dollars in stolen goods, along with drugs and burglary tools, across multiple states.
These sophisticated operations require equally advanced solutions that combine technology, collaboration, and forward-thinking policies.
Solutions to Stop ORC
Tackling ORC is part of a broader effort to protect both physical and digital retail assets. Effective strategies focus on prevention, detection, and quick response, relying on technology, employee training, and partnerships with law enforcement.
AI-powered surveillance systems with facial recognition are a key tool in fighting ORC. These systems can identify known offenders before they even enter a store and alert security teams in real-time. Paired with automated license plate readers, retailers can track suspicious vehicles and spot patterns across locations.
Mobile surveillance units have shown impressive results, reducing high-risk crimes by 62% and cutting grab-and-go thefts by 69%. These visible security measures act as a strong deterrent since criminals tend to avoid heavily monitored areas.
"Crooks seek the path of least resistance which is why an ounce of prevention is truly worth a pound of the cure. The bad guys see it, get it, and ultimately fear it."
- Mike Lamb, Retired Asset Protection Leader
Collaboration among retailers has become essential. Platforms like CrimeTracer allow businesses to share data, connect crimes to suspects, and track criminal networks. Sharing video footage and crime data with law enforcement improves investigations and response times.
Integrating RFID technology with in-store video surveillance offers a powerful way to track high-value items and detect theft patterns. Retailers can get instant alerts when products leave their designated areas without proper checkout, creating a more comprehensive security system.
Employee training is another critical element. Staff need to understand how to spot ORC tactics, distinguish between individual shoplifters and organized groups, and follow safety-first response protocols.
Legislation is also stepping up to address ORC. The INFORM Consumers Act now requires online marketplaces to implement transparency measures, making it harder for criminals to sell stolen goods online. At the same time, states are forming dedicated ORC task forces to coordinate efforts across jurisdictions.
While physical security measures like visible cameras remain important, they must be part of a larger strategy. Regularly reviewing and updating security plans ensures that retailers stay ahead of evolving threats.
The need for comprehensive ORC prevention is clear. As Cory Lowe, Senior Research Scientist at the Loss Prevention Research Council, puts it: "Everything points to a continuing increase in retail crime". Proactive measures are no longer optional – they’re essential for protecting businesses and consumers alike.
2. Employee Theft and Collusion
While Organized Retail Crime (ORC) often grabs headlines, the largest financial losses in retail come from within. Employee theft accounts for a staggering 29% of retail shrinkage, costing businesses nearly $50 billion annually. In fact, 75% of employees admit to stealing from their employer at least once. These internal vulnerabilities, coupled with external threats, significantly weaken retail security.
Employees’ access to cash, inventory, and restricted areas makes internal theft particularly damaging. Their familiarity with security systems and protocols allows them to exploit weaknesses that external thieves can’t reach. Tackling this complex issue requires equally multifaceted solutions.
How Internal Theft Happens
Employee theft can take many forms, ranging from subtle to blatant. Cash theft is one of the most common methods, involving actions like skimming register transactions or pocketing cash from sales. Fraudulent activities such as falsifying returns, misusing credit or gift cards, and other cash-handling manipulations are also widespread. Time theft, though less obvious, can add up – employees may clock in without working, take extended breaks, or have someone else punch in for them.
More severe offenses include embezzlement, accounting fraud, and intellectual property theft. Collusion with external criminals poses an even greater risk. Employees might share insider knowledge about store security or inventory locations with organized retail crime groups. In some cases, criminal networks intentionally place individuals in retail positions to facilitate theft operations.
"Let employees know that any dishonest acts come with serious consequences." – Timothy Dimoff, Certified Legal Expert in Corporate Security Procedures
The collaborative nature of internal theft makes it particularly challenging to uncover. Employees may cover for one another, creating schemes that bypass standard security measures. Understanding these tactics is critical for developing effective prevention strategies.
Ways to Prevent Employee Theft
Preventing employee theft requires a layered approach that combines technology, clear policies, and a strong culture of accountability. AI-driven security cameras can monitor employee behavior, identifying unauthorized access to restricted areas or unusual transaction patterns. When paired with point-of-sale systems, these cameras can flag suspicious activities like altered transactions, unwarranted discounts, or cash-handling discrepancies in real time.
"Internal fraud can be a hidden threat for many retailers. AI cameras give us the tools to monitor and detect unusual employee behavior, ensuring that we’re protecting not just our inventory but also maintaining trust within our teams." – Jeff Storrs, Regional Manager of Retail
Access control systems add another layer of protection by limiting entry to sensitive areas based on job roles. These systems also log entries and exits, helping to identify unusual activity. Combined with video surveillance, they provide visual evidence that can pinpoint questionable behavior. Strategically placing cameras near entrances, cash registers, and storage areas further discourages theft.
Thorough background checks during the hiring process are essential for identifying candidates with histories of theft or fraud. Regularly reviewing access permissions ensures that employees only have the rights necessary for their current roles, reducing risks when someone changes positions or leaves the company.
Training employees goes beyond compliance – it should empower them to recognize and respond to potential theft scenarios. Role-playing exercises and real-world examples can help staff identify suspicious situations. As one expert put it:
"Loss prevention is everyone’s job – and when your team is bought in, they’ll prove it every day." – Starsky Smith
Training should also promote teamwork and accountability, creating an environment where employees feel safe reporting concerns. Clear policies, ethics training, and regular reviews of procedures reinforce the importance of honesty and the consequences of dishonest actions.
Building a workplace culture that encourages integrity and vigilance is key. With untrustworthy employees often responsible for 90% of major business losses, investing in internal theft prevention measures is not just a smart move – it’s essential for staying in business.
3. Cybersecurity Threats in Retail
While shoplifting might grab more headlines, cyber threats are hitting retail businesses where it hurts – costing over $20 billion in IoT-related attacks alone in 2024. A staggering 80% of retailers reported experiencing a cyberattack in the past year, with 629 incidents documented in 2022, including 241 confirmed data breaches. In fact, retail ranked as the second most targeted industry for ransomware in 2021, with 77% of global retail organizations falling victim to such attacks. And the financial toll? The average data breach costs $4.88 million.
Retailers are prime targets because their systems process massive amounts of payment and personal data. As Ken Ford, Global Security Lead at W.L. Gore and Associates, explains:
"Over a quarter of all cyber attacks focus on retail sectors, mainly because of the rich trove of credit card details and personal data they hold and the fact that no retail business is too small to target." – Ken Ford
The challenge is compounded by the dual exposure of physical stores and online platforms. E-commerce, in particular, is a hotbed for cyberattacks, accounting for 32.4% of all incidents. Over half (54%) of e-commerce companies have suffered at least one successful cyberattack. These numbers underline the pressing vulnerabilities facing the retail sector.
Common Cyber Vulnerabilities
Retailers face a variety of cyber threats, each exploiting specific weaknesses:
- Phishing attacks are the most common, responsible for 58% of incidents. These attacks often trick employees into revealing credentials or installing malware. Notably, 81% of malicious breaches originate from compromised passwords.
- Point-of-sale (POS) systems are a favorite target for hackers. These systems process countless transactions daily, making them treasure troves of payment card data. A chilling example is the 2013 Target breach, where malware infiltrated the POS system, stealing over 40 million debit and credit card numbers and costing the company $18.5 million in settlements.
- Ransomware attacks are growing more sophisticated. In 2023, 69% of retail companies faced ransomware incidents, with 71% of attackers successfully encrypting data. The food and beverage sector bore the brunt, with 16% of ransomware cases targeting this segment. Groups like Play and LockBit 2.0 are particularly active in this space.
- IoT devices, such as smart cameras and inventory trackers, introduce new risks despite their operational benefits. While 84% of enterprises use IoT devices, fewer than half implement adequate security measures. Alarmingly, 57% of IoT devices are vulnerable to moderate or severe attacks.
- Automated threats are another growing concern. Bots account for nearly 40% of all traffic to retail websites, engaging in activities like credential stuffing, account takeovers, and data scraping.
- Brute force attacks remain a persistent issue, responsible for 92% of credential access attempts. Meanwhile, insider threats have risen by 38% in the last two years, compounding external risks.
Cybersecurity Solutions That Work
Tackling these challenges requires a mix of technical defenses and proactive strategies:
- Network segmentation is a critical step. By isolating systems like POS terminals, customer databases, and IoT devices, retailers can limit an attacker’s ability to move across a network.
- Encrypt sensitive data during transmission and when stored. Combine this with multi-factor authentication (MFA) to reduce the risk of credential-based breaches. MFA adds an extra layer of security to POS systems, customer databases, and administrative accounts.
- For IoT security, frameworks like the NIST IoT Cybersecurity Framework provide guidance. Key measures include using strong, unique passwords, enabling automatic firmware updates, and encrypting device data. Regular security audits can also identify and address vulnerabilities.
- Deploy anti-malware solutions across the network, with special attention to POS systems. These tools should offer real-time monitoring and automatic threat detection to respond swiftly to attacks.
- Implementing Zero-Trust Access (ZTA) can further enhance security. This model continuously verifies user identities and access rights, reducing risks from insider threats and stolen credentials.
- Regularly back up data to prepare for ransomware attacks. Store backups offline or in immutable storage, and test restoration processes to ensure they work when needed [1].
- Employee training is one of the most effective ways to combat phishing, which accounts for 58% of incidents. Training programs should include role-based education and simulated phishing exercises to reinforce awareness.
Retailers must also manage third-party risks as supply chain attacks become more frequent. Regularly assessing vendor security practices ensures compliance with cybersecurity standards. Adhering to regulations like PCI-DSS and GDPR not only avoids penalties but also strengthens data protection.
As Barry Mainz, CEO of Forescout, warns:
"We’re handing attackers the keys to critical operations. Cybercriminals are ditching traditional endpoints and targeting the devices that keep our hospitals, factories, governments, and businesses running."
With cybercrime expected to cost $9.5 trillion globally in 2024, investing in robust cybersecurity measures isn’t just smart – it’s necessary to protect retail operations in an increasingly hostile digital landscape.
4. Shoplifting and Opportunistic Theft
Shoplifting is a costly problem for retailers, with losses exceeding $13 billion annually. Shockingly, around 27 million Americans – or 1 in 11 people – have shoplifted, and incidents have surged by 30% in the past year, with nearly a 25% increase just in the first half of 2024.
The financial damage goes beyond the stolen goods themselves. Shoplifting accounts for 36% of all retail shrinkage each year, with the average theft amounting to $125 per incident. Small businesses feel the sting even more, suffering revenue losses 35% higher than their larger counterparts.
Shoplifting spans across demographic lines. About 25% of shoplifters are juveniles, while adults make up the remaining 75%. Men are slightly more likely to shoplift, accounting for 55% of cases, compared to 45% for women. Interestingly, 20% of shoplifters come from households earning over $75,000 annually, proving that financial need isn’t always the driving factor.
"Retail stores face rising theft and ORC with predictions suggesting that this is only expected to rise".
High-Risk Areas and Products
Understanding what thieves target and where theft occurs is critical for retailers aiming to tighten security. Items that are Concealable, Removable, Available, Valuable, Enjoyable, and Disposable (CRAVED) are prime targets.
Electronics lead the pack, thanks to their high resale value and profitability. In one striking case from 2023, a masked thief stole 50 iPhones worth $49,230 from a California Apple store. Clothing is another top target due to its high value, easy resale, and concealability.
Alcohol theft is also rampant. Over six months in 2024, thieves in Virginia stole more than 14,000 bottles of alcohol worth $800,000 from ABC stores, racking up 3,754 incidents. Cosmetics, with their strong resale demand, are frequently stolen as well. In 2022, a theft ring leader was arrested for stealing around $8 million worth of cosmetics.
Food theft is becoming more common, too. For instance, two men were caught stealing $1,200 worth of meat from a Safeway in South Bay. Baby formula is another high-value target, with $20,000 worth stolen from Walmart locations.
| Product Category | Most Stolen Items |
|---|---|
| Electronics | Mobile devices, tablets, audio gear |
| Apparel | Athletic wear, denim, graphic T-shirts |
| Health & Beauty | Body creams, cosmetics, fragrances |
| Food & Beverage | Alcohol, meat, seafood, energy drinks |
| Children’s Items | Diapers, infant formula |
| Accessories | Jewelry, backpacks, handbags |
Store layouts can also make a difference. Poorly designed spaces with blind spots, hidden alcoves, or crowded entrances make it easier for thieves to strike. High-demand "hot products" displayed in vulnerable areas are especially attractive to shoplifters.
Location matters, too. States like California and New York report shoplifting rates about 25% higher than the national average. Stores in urban centers, busy areas, or economically challenged neighborhoods tend to see more theft.
By identifying these vulnerabilities, retailers can better position themselves to combat theft.
Tools to Prevent Theft
Preventing shoplifting requires a mix of cutting-edge technology and attentive staff. AI-powered cameras are a standout tool, capable of recognizing items and flagging suspicious behavior in real time.
"AI-powered security cameras are transforming retail loss prevention by offering real-time insights and alerts. They’re not just about catching theft after the fact but preventing it before it happens. This proactive approach is a game-changer for retailers".
RFID and Electronic Article Surveillance (EAS) systems also play a major role. These systems track items and trigger alarms if tagged products pass detection points without authorization. For example, Lowe’s uses a program called Project Unlock, embedding RFID chips in power tools that remain inoperable until scanned at checkout. The purchase is then logged on the blockchain for verification.
Video analytics software enhances surveillance by detecting unusual activity, while facial recognition helps identify repeat offenders. Smart displays notify staff when high-value items are removed, and mobile POS systems ensure better visibility across the store.
Physical measures are equally important. Anti-push-out systems stop shopping carts from leaving the premises without approval, and clear signage can deter would-be thieves. Mirrors placed strategically eliminate blind spots and discourage criminal behavior.
Well-trained employees are another crucial line of defense. Staff who are skilled at spotting suspicious behavior and engaging with customers can make a big difference. Simple acts of interaction, like greeting customers, can reduce theft by making shoplifters feel observed.
"The first thing we look at is, can we detect these people and identify them before there are victims? We’re trying to get the offender or crew to say, ‘Not here, not now, this doesn’t feel right’".
"Thieves want the easiest job possible. If your store has some basic security protocols, they move on to a store that hasn’t been hardened".
With retail theft losses projected to reach $115 billion by the end of 2025, and 30% of retailers planning to increase spending on loss prevention, staying ahead of evolving theft tactics is more important than ever. Combining advanced tools with vigilant staff offers a strong defense against this growing challenge.
5. Physical Security Gaps
Weak physical security in retail stores creates easy opportunities for theft. Issues like poor store layouts, dim lighting, and blind spots can turn what should be secure spaces into prime targets. On average, retailers lose about 1.62% of their inventory to theft each year, and only 1 in 42 shoplifters is actually caught. To make matters worse, 2023 saw a 93% surge in shoplifting incidents compared to 2019. The first step in addressing these challenges is identifying where the vulnerabilities lie.
Finding Blind Spots
Some of the most dangerous security gaps are the ones you don’t notice until it’s too late. Blind spots, poorly lit areas, cluttered aisles, and unsecured exits are all common culprits. Employee-only areas, such as stockrooms, break rooms, and loading docks, are often overlooked when it comes to surveillance, making them hotspots for internal theft.
Lighting is another critical factor. Dark corners, dim aisles, and shadowy areas provide cover for shoplifters. Cluttered layouts with narrow aisles and blocked sightlines make it even easier for thieves to operate undetected. Unsecured exits, like emergency doors without alarms or unmonitored side doors, offer quick escape routes. Even something as simple as a broken lock or damaged window can send a signal that security isn’t a priority.
"Having a good, solid plan is crucial to security. Flexibility in the plan and being able to change direction on a dime is important, as security is very reactive given certain situations." – Tony Putzig, Supervisor of East Region Security at Cox Enterprises
Better Physical Security
Once weaknesses are identified, a clear strategy can turn these vulnerabilities into strengths.
- Strategic camera placement is key to eliminating blind spots. Wide-angle and people-counting cameras at entrances and exits can monitor customer flow, while fixed-focus cameras at cash registers capture transactions. PTZ cameras in stockrooms offer flexible coverage, and thermal imaging or heat mapping in aisles can highlight high-traffic areas.
- Improved lighting deters theft by removing hiding spots and enhancing the quality of surveillance footage. Motion-activated lights in low-traffic zones can startle would-be thieves and alert staff to unusual activity.
- Smart merchandise placement ensures high-value items are displayed in well-monitored, easily visible areas. Heat maps can help pinpoint zones that need extra attention.
- Access control systems like keycards, biometric scanners, or PIN codes secure employee-only areas. These systems track who enters and exits, promoting accountability.
- Integrated security platforms connect video surveillance, access control, and alarms into a single network. For example, if an alarm is triggered, the system can automatically direct cameras to the affected area, speeding up response times.
- Regular security audits are essential for maintaining effective systems. These reviews should check entry points, test alarms, review access logs, and ensure compliance with security protocols.
- Employee training is another critical layer of defense. Staff who know how to spot suspicious behavior, follow security protocols, and respond appropriately can make a big difference.
"Employee awareness is one of the most effective tools for maintaining security. Training programs empower employees to recognize potential threats, understand access control protocols, and report suspicious activity promptly. By developing a culture of vigilance, businesses can rely on their workforce as an additional layer of defense." – LenelS2
- AI-powered analytics take surveillance to the next level. These systems analyze video feeds in real time, flagging suspicious behavior and identifying patterns that could indicate security risks. They can also reduce false alarms by up to 90%, making responses more efficient.
A multi-layered approach – combining proper camera placement, effective lighting, smart product displays, secure access controls, integrated systems, routine audits, well-trained employees, and advanced analytics – makes it much harder for thieves to succeed. Every layer adds a new challenge, raising the stakes for anyone attempting theft.
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6. Supply Chain and Inventory Shrinkage
When it comes to reducing retail shrink, securing the supply chain is just as crucial as addressing in-store challenges. Inventory losses can occur at any point along the supply chain. The National Retail Federation reported that retail shrink reached a staggering $112.1 billion in 2022, equating to 1.6% of total sales. Additionally, about 67% of logistics leaders have experienced inventory losses during transit, with losses ranging from $100,000 to $5 million annually.
Breaking down the causes, external theft accounts for 36% of retail shrink, while internal theft contributes 29%. Administrative errors, breakage, and vendor fraud make up another 27%, leaving 6% unaccounted for. Employee theft is particularly prominent, with theft overall responsible for roughly two-thirds of the $100 billion in annual retail shrink.
"Theft of all types, including by employees, is the largest cause of shrink. Errors are the second-largest." – Industry Dive
Supply Chain Weak Points
The path from warehouse to store shelves is filled with risks. Transportation, especially during long-haul shipping or facility transfers, poses a significant threat to inventory security. Storage facilities also have their vulnerabilities, such as poor inventory controls, insufficient security, and limited visibility into stock movements. These weaknesses can allow discrepancies to go unnoticed until audits reveal them.
Supplier fraud is another challenge, with vendors sometimes charging for more items than they deliver or sending products of lower quality than ordered. Return fraud has also become more sophisticated. In 2023, retailers handled nearly $750 million in returns, with over $13 of every $100 in returned items deemed fraudulent. Human factors play a role as well – employees with unrestricted access to inventory systems or storage areas can unintentionally or deliberately cause losses if proper controls aren’t in place. Addressing these vulnerabilities requires advanced, integrated technologies to track and secure inventory at every step.
Technology to Secure Inventory
Retailers are turning to advanced technologies to tackle these challenges head-on. RFID technology has proven especially effective. For instance, some businesses have reduced their annual inventory variance from $170,000 to just $5,000 in a single year, while achieving a 300% improvement in inventory accuracy. Unlike traditional barcodes, RFID tags don’t require line-of-sight scanning and can track multiple items simultaneously. Passive RFID tags are relatively inexpensive, costing only a few cents to a few dollars, while active tags range from several dollars to over $50.
"RFID enables end-to-end traceability in supply chains, especially when paired with other technologies like blockchain. It’s even used to ensure the authenticity of pricy, counterfeit-prone items such as Kobe beef, olive oil and mislabeled fish." – Kevin Beasley, Forbes Councils Member
IoT devices, including Bluetooth beacons, integrate seamlessly with inventory management systems to provide real-time updates on product location, condition, and movement. GPS tracking and IoT technologies further enhance visibility, reducing customer complaints and ensuring inventory accuracy. In fact, 88% of companies using GPS-enabled systems reported fewer customer complaints about missing items. Computer vision systems, equipped with networks of cameras and advanced computing, can automatically count products and flag discrepancies, minimizing the need for manual checks. Meanwhile, Artificial Intelligence analyzes data patterns to optimize stock control and improve forecasting accuracy.
One U.S. retailer successfully implemented the Wiliot Data Visibility Platform to monitor merchandise bins throughout its supply chain. This system tracks bin handling, precise locations, and temperature conditions at various stages, ensuring pharmaceutical safety, meeting regulatory requirements, and addressing stocking issues proactively to maintain customer satisfaction.
The real game-changer lies in integration. Open APIs allow different systems to work together, creating a unified view of inventory as it moves through the supply chain. When paired with strategies like carrier diversification, partnerships with multiple suppliers, predictive analytics, and flexible logistics, these technologies help build resilient supply chains capable of withstanding various challenges.
7. Violence and Workplace Safety Concerns
Violence in retail workplaces has become an alarming issue, driving up employee turnover and complicating business operations. While managing inventory threats remains a priority, ensuring employees feel safe at work is equally critical.
The statistics are sobering. Workplace violence has become the third-leading cause of fatal workplace injuries in the U.S., with 740 fatalities attributed to violent acts in 2023 alone. Beyond physical harm, these incidents leave employees grappling with anxiety and declining mental health, creating a ripple effect of challenges.
Rising Retail Violence
Retail workers are facing a perfect storm: customer entitlement, economic stress, and the lingering effects of COVID-19 have all contributed to a rise in violent incidents. The pandemic didn’t just disrupt daily life – it also normalized erratic behavior, as customers voiced frustrations over mask mandates, social distancing, and other protocols. This has led to a broader security crisis for retailers.
Organized Retail Crime (ORC) has added fuel to the fire. A staggering 81.2% of retailers reported increased aggression tied to ORC. Reduced penalties for such crimes have emboldened offenders, while the pandemic disrupted social norms, making these behaviors even more prevalent.
"The pandemic was a catalyst for erratic behavior to become more acceptable as customers wanted to state or show their opinions on COVID, social distancing, and mask requirements. Then ORC increased dramatically, so the magnitude of incidents compounded with the violent nature and fearlessness of repercussions has heightened safety concerns." – Marty Andrews, Vice President of Loss Prevention at VF Corp
The toll on retail workers is immense. During the pandemic, turnover among part-time retail workers soared to 95%. Even now, retail employees quit at rates over 70% higher than those in other industries. Emotional abuse is widespread – 60% of food service workers reported experiencing it from customers, and 78% said their mental health had worsened as a result. Alarmingly, nearly half (49%) of retail employees would only report workplace violence if anonymity were guaranteed.
"Guest-on-associate violence has become a greater priority among a greater number of retailers than any other crime over the past five years." – National Retail Federation’s National Retail Security Survey
Better Workplace Safety
To address these challenges, retailers are turning to integrated safety systems and clear policies. Just as theft prevention relies on multiple layers of security, safeguarding employees requires a comprehensive approach.
Panic button systems have emerged as a practical and effective tool. These systems, which include real-time tracking and two-way communication, can help de-escalate conflicts and ensure quick responses. The financial benefits are notable, too. A Vice President at Brown & Brown highlighted that their Experience Mod dropped by nearly 50% – its lowest level since 2015 – thanks to their partnership with ROAR, which provided technology to deter workplace violence.
Training programs are another cornerstone of prevention. New York’s Retail Worker Safety Act, effective June 2, 2025, mandates comprehensive training for retail employees. These programs cover self-protection, de-escalation techniques, active shooter drills, emergency procedures, and the use of security systems like alarms and panic buttons. Tailored to specific roles and workplace policies, this training equips employees to handle incidents effectively.
Communication systems are critical during emergencies. Tools like emergency notification systems, mobile apps, and panic buttons offer employees multiple ways to request help. Companies such as Relay have implemented combined panic alert and communication systems in retail environments. As Wayne Burgher, General Manager at Residence Inn Grand Rapids Airport, shared, "I would recommend Relay to whoever else is looking for a panic system".
Beyond technology, clear policies are essential. These should define unacceptable behaviors – such as violence, harassment, and bullying – and provide robust reporting guidelines. Regular risk assessments can identify vulnerabilities, while enhanced security measures like visitor management, video surveillance, and on-site security personnel add layers of protection.
"Retailers can’t change the public-facing nature of their workplaces, but they can change how they protect and prepare their employees." – Elissa Rossi, VP of Compliance Services at Traliant
Creating a workplace culture where employees feel safe reporting concerns without fear of retaliation is vital. Post-incident reviews can help identify system weaknesses and refine prevention strategies, turning every incident into a learning opportunity.
8. Security Regulation Compliance
Staying compliant with security regulations is crucial for protecting your retail business and avoiding hefty fines. Think of it like workplace safety – it requires proactive measures and ongoing attention. Similarly, regulatory compliance demands systems that can handle complex requirements to safeguard operations against various risks.
For instance, failing to meet PCI compliance standards can cost retailers anywhere from $5,000 to $100,000 per month in fines. Beyond fines, the fallout from severe data breaches can be devastating. Companies often see their market value drop by 10-15% in the months following such incidents. And once consumer trust is broken, it can be incredibly challenging to rebuild.
Key Security Regulations
One of the most impactful recent changes in retail security laws is the INFORM Consumers Act, which went into effect on June 27, 2023. This federal law is designed to tackle the growing issue of stolen and counterfeit goods being sold online.
"The INFORM Consumers Act increases transparency in online transactions and deters criminals from selling stolen or unsafe goods." – Federal Trade Commission
The law specifically targets "high-volume third-party sellers", defined as those conducting 200 or more transactions totaling $5,000 or more within a 12-month period. With platforms like Amazon reporting that 60% of all units sold come from small-to-medium-sized businesses, this regulation has a broad impact on the online retail ecosystem.
Under the Act, online marketplaces must collect and verify detailed information from these sellers, including bank account details, tax identification numbers, and contact information. They must also disclose certain seller details in product listings or order confirmations.
The enforcement mechanisms are stringent. The Federal Trade Commission (FTC) can impose civil penalties of up to $50,120 per violation, and state Attorneys General also have the authority to enforce compliance. As Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, puts it:
"The INFORM Consumers Act requires online marketplaces to protect consumers from counterfeit, unsafe, and stolen goods by verifying their high-volume third-party sellers’ identities, and making it easier for consumers to report suspicious marketplace activity."
Compliance Tools for Retailers
Just as advanced technology helps counter physical and cyber threats, modern compliance tools are essential for navigating regulatory requirements. The numbers tell a clear story: compliance costs in the financial services sector increased by an average of 12% in 2023, and 82% of compliance leaders report challenges related to third-party risks.
Here are some tools and strategies that retailers can use to stay compliant:
- Automated identity verification systems: These tools are becoming indispensable, especially for marketplace operators. For example, Veriff has partnered with companies like Easygo and Stake to streamline age and residency checks for online platforms, showing how automation can simplify compliance without disrupting user experience.
- Centralized compliance platforms: These platforms help standardize policies and monitor data in real time, ensuring consistent adherence to regulations.
- Risk-based approaches: Focusing on high-risk areas is key. This includes setting up vendor assessment processes for third-party relationships, integrating risk management across departments, and providing continuous training to keep teams up to date on regulatory changes.
- Real-time monitoring and audit trails: These systems automatically log transactions, verify seller statuses, and flag suspicious activities, making it easier to demonstrate compliance during reviews.
For marketplace operators, clear policies for managing non-compliant sellers are vital. Automated suspension mechanisms can quickly address violations, while efficient processes for reinstating accounts help maintain smooth operations.
"Establishing a standard, nationally consistent expectation for the entire industry is a positive development that will help ensure small businesses selling products online do not have to manage an unworkable patchwork of state-level regulations." – Amazon
The ultimate goal is to create systems that can adapt to evolving regulations. As U.S. Senator Dick Durbin aptly stated:
"By providing appropriate verification and transparency of high-volume third party sellers, the INFORM Consumers Act will shine a light that will deter online sales of stolen, counterfeit, and unsafe goods and protect consumers."
Conclusion: The Future of Retail Security
The landscape of retail security is evolving at breakneck speed. Cybercrime costs are staggering, while retail theft and related losses drain over $112 billion annually from U.S. businesses. Organized retail crime surged by 27% in 2023, and workplace violence incidents have climbed 17% year over year. Retailers can no longer afford to take a reactive stance on security.
The challenges are multifaceted. Almost half of all traffic to retail websites comes from malicious bots, and employee theft accounts for a striking 33% of shrink. These realities are pushing retailers toward comprehensive, technology-driven solutions.
Looking ahead, by 2025, 70% of retailers are expected to invest in AI-powered surveillance systems, while 38% will implement cloud-based access control. These measures are projected to reduce high-risk crimes by 62% and grab-and-go thefts by 69%. Early adopters are already seeing encouraging results.
"We’re trying to get the offender or crew to say, ‘Not here, not now, this doesn’t feel right.’" – Dr. Read Hayes, director of the Loss Prevention Research Council
Proactive maintenance strategies are proving their worth, saving 8–12% compared to preventive maintenance and up to 40% compared to reactive methods. Meanwhile, 82% of consumers report they would stop engaging with a brand online after a data breach, highlighting that security is not just about loss prevention – it directly impacts customer trust and loyalty.
Yet, even as current strategies show promise, new threats demand constant vigilance. By late 2024, organizations faced nearly 1,900 cyberattacks per week on average – a 75% increase from the previous year. These attacks are becoming more sophisticated, with AI-driven methods gaining traction and supply chain attacks skyrocketing by 742% between 2019 and 2022.
E-commerce growth further complicates the picture. Now accounting for 30% of retail, online shopping has expanded the attack surface. Recognizing this, more than half of U.S. retailers plan to increase investments in loss prevention technologies by 2025. Security today isn’t just about protecting inventory – it’s about safeguarding the entire customer journey.
Success in this shifting security environment calls for a balanced approach that combines human expertise with cutting-edge technology. While 67% of shoppers feel safer when security measures are visible, only 46% of retailers fully trust their vendors’ protocols, underscoring the importance of robust vendor management.
Forward-thinking retailers view security as a competitive edge. They are implementing tools like AI-powered fraud detection, adopting zero-trust security models, and fostering cross-functional teams to enhance cybersecurity awareness. With 43% of cyberattacks targeting small businesses – and over 60% of those affected shutting down within six months – proactive security measures are no longer optional; they are essential for survival.
"Crooks seek the path of least resistance – an ounce of prevention is worth a pound of cure"
The future of retail security lies in making your business the hardest target. Through smart technology and proactive planning, retailers can turn security into a strength rather than a vulnerability.
FAQs
What are the best technologies retailers can use to combat organized retail crime (ORC)?
Retailers have a range of technologies at their disposal to combat organized retail crime (ORC) and safeguard their operations. High-definition surveillance systems equipped with real-time monitoring not only discourage theft but also provide crucial evidence when incidents occur. RFID technology plays a key role by enabling real-time inventory tracking and sending alerts for unusual activities, like unauthorized item movement.
On top of that, AI-driven analytics can spot suspicious shopping behaviors, helping to prevent theft before it escalates. Retailers can also utilize facial recognition systems to identify repeat offenders and automated license plate recognition (ALPR) to track vehicles associated with ORC activities. When paired with efficient incident reporting tools for employees, these technologies create a strong, multi-layered defense against retail crime.
How can retailers ensure strong cybersecurity without negatively impacting the customer experience?
Retailers can strike a balance between strong cybersecurity and a smooth customer experience by focusing on solutions that combine security with ease of use. For instance, biometric authentication and tokenized payments not only bolster security but also make transactions quicker and more hassle-free at checkout.
Another essential step is educating customers about security measures. When retailers clearly communicate how they protect customer data, it fosters trust and peace of mind. Features like real-time mobile alerts for suspicious activity add an extra layer of security, ensuring customers feel safeguarded without disrupting their shopping experience. This strategy not only protects sensitive data but also reinforces the retailer’s dedication to both security and customer satisfaction.
What are the best ways to prevent employee theft in retail stores?
Preventing employee theft in retail takes a mix of smart technology, clear policies, and fostering the right workplace atmosphere. Start with reliable surveillance systems to keep an eye on key areas like cash registers, stockrooms, and entry points. These systems act as both a deterrent and a way to catch irregularities early.
You can also use access control systems to limit who can enter sensitive spaces like inventory rooms or managerial offices. On top of that, invest in thorough employee training that covers theft prevention, ethical standards, and company policies. Educating your team helps build a sense of responsibility and awareness.
Lastly, focus on creating a supportive and respectful work environment. When employees feel appreciated and trusted, they’re far less likely to resort to dishonest actions. A positive workplace can go a long way in reducing theft while boosting overall morale.