Target said Tuesday it would close nine stores in four states, saying theft at the locations was hurting business and endangering the safety of employees and customers.
The stores closing next month include one in Manhattan’s East Harlem that has been open since 2010, as well as several locations in San Francisco, Seattle and Portland, Oregon.
“We know our stores play an important role in their communities, but we can only thrive when the work and shopping environment is safe for everyone,” the retailer said in a statement.
In recent months, Target has been vocal about the issue of theft in its stores, particularly organized retail crime in which large quantities of merchandise are stolen with the aim of selling them on the black market.
Target CEO Brian Cornell said on a conference call in August that the company “continues to face unacceptable levels of retail theft and organized retail crime.” He said that in the first five months of the year, store thefts involving violence or threats of violence increased by 120 percent.
Executives at other retailers such as Macy’s and Dick’s Sporting Goods have also warned Wall Street about the impact of theft on their business.
On Tuesday, the National Retail Federation released its annual survey of major brands, which found that the average shrink rate — the industry term for the value of goods that disappear from stores unpaid due to theft, damage and inventory tracking errors — declined from 1.4 percent in 2021 to 1.6 percent of sales in 2022. The average shrinkage rate was 1.6 percent in 2019 and 2020.
According to the survey, 36 percent of shrinkage is due to theft, while 29 percent of that is due to employee theft. According to the survey, 27 percent were due to process, control failures and errors.
Although shrink rates remain similar to 2019 and 2020, some retailers say theft is a concern for them. This year, two-thirds of respondents reported seeing even more violence and aggression from participants in organized retail crime.
In May, Target Chief Financial Officer Michael Fiddelke said the retail chain would lose $500 million in profits if the contraction trend continued. The company has also spent more on security, including using third-party security services.
Some unions representing retail workers said store employees have faced more unruly customers and various workplace crimes, including assault, since the start of the pandemic.
However, some in the industry warn that there is not enough reliable data on the topic. Retailers often report shrinkage more during difficult economic times, when their profits are already under pressure, analysts say. Additionally, retailers typically do not publicly report crimes that occur in their stores, making it difficult for the public to estimate how common they are.
There were also some retailers who later said their concerns about shoplifting were overblown. That was the case with Walgreens, which said in January that “we may have cried too much last year” on the issue of theft.
Executives who have spoken publicly about theft and organized retail crime have said they need help from government officials and law enforcement to solve what they say is a widespread problem. Target said it had urged officials to support a bill in Congress that would create a task force of federal agencies to combat retail crime. It also said it also hosted store tours with various government officials, including members of Congress, state lawmakers and local community partners, to educate them on how the company is trying to address the problem.
Target said its employees’ safety was at risk in other ways this year. In May, the company adjusted its Pride Month displays at some locations by moving some of its merchandise to the back of stores after customers allegedly yelled at workers.
On Tuesday, Target emphasized that while it was closing some of its stores, there were other places nearby to shop. It said “eligible team members” would be offered jobs at other Target locations.
Shops will close on October 21st.