While a certain amount of theft has always been among retailers’ costs, recent shoplifting and robberies have taken an even greater toll on independent stores.Unlike nationwide retailers that have multiperson loss prevention teams and ample capital to try to thwart thieves, smaller chains or one-unit stores don’t have the same degree of manpower or money to combat the problem. In addition, the theft of tens of thousands of merchandise and the costly preventive measures that are needed in response to such incidents chips away at their bottom lines.
What Comes Around Goes Around’s vice president of retail and client services Julian Guevara said, “I would like to hope it’s temporary but I think it’s more of a cost of doing business. Luxury retailers are constantly being stolen from. I’ve been in luxury retail in New York City for 12 years. This isn’t new. Given the times we’re living in and everything that’s going on socially and economically for so many people, it’s definitely increased. I would hope it goes down but it’s always going to present.”
Vandalism repairs can result in temporary store closures, as was the case recently for Designer Revival, a consignment shop in New York City. Head of e-commerce Bonnie Jaindl said, “There’s really no such thing as a petty crime for a small business. It hurts our bottom line, especially since we’re trying to recover from the COVID[-19] pandemic and the shutdown.”
Earlier this month Designer Revival was broken into overnight.
A handful of stores in New York City, Seattle, Chicago and Denver spoke with WWD about how they are regrouping, or in one instance closed, due to the ongoing issue of shoplifting and theft. And it’s not just designer products that are being stolen — so are Jordan sneakers and athletic jerseys. Instituting a minimal crime hike fee for all purchases, working with local police detectives and upgrading security systems are some of the methods that stores are using to try to safeguard against the problem.
After five burglaries in the past two years, the sneaker-centric Flee Club in Chicago is planning “a slow relaunch” in another city, said manager Jerry Walker. An overnight robbery earlier this month of Amiri denim, Gallery Dept. and other goods resulted in a loss in the “tens of thousands,” he said.
In response to that, the company has started a #GoFundMe and is nearing its goal of $15,000 for business expenses. The suspects have not been arrested, according to Walker, who attributes the recent crime to the economy. Asked what would improve the situation, he said, “I don’t think it’s going to improve. It’s going to get worse unless people come across money, where they don’t have to take and steal.”
In Manhattan, a group of people stole from Kirna Zabête’s SoHo store on two different Sunday afternoons —attempting to take $40,000 worth of goods on April 3 and $50,000 worth of merchandise on Feb. 6. They entered the store right after its security guard had gone on his break and used wire cutters to take designer handbags, said owner Beth Buccini.
“When they came in the first time, one of my stylists chased after them and they flashed a gun at him. It’s completely brazen in SoHo right now. So there are police officers and undercover cops on every corner,” she said.
In addition to taking on the “exorbitant” cost of an in-store security detail seven days a week, Kirna Zabête has panic buttons to call the local police precinct directly, security cameras and a doorbell that triggers videotaping of visitors, the owner said. Like several other retailers, she said thieves, including those who steal less than $1,000 worth of hoodies, need stiffer consequences.
During the April 3 incident, store employees recognized the robbers from the previous theft two months ago and hit the panic button. While fleeing the store, the accused dropped $40,000 worth of designer merchandise and got into an altercation with the police, resulting in one officer being injured, Buccini said. “It’s obviously very scary and challenging, and the worst I’ve ever seen it. I’ve been in business since 1999 and I have never seen it like this. Nobody has.”
Although Kirna Zabête is talking with area retailers about the problem, improvement is needed for SoHo’s neighborhood watch, she said. The problem has also cropped up in the Hamptons. Recently in the retailer’s East Hampton store, an employee was uneasy about a shopper who was FaceTiming a tour of the store, and the employee “kind of pushed the person out of the store,” Buccini said. “They came back the next day and hit the Balenciaga store and took $90,000 worth of merchandise. But there was a high-speed [police] chase and they caught them.”
Complicating the issue for small business owners is insurance reimbursement for the wholesale price instead of full retail, not to mention insurance premium hikes — 15 percent increases for Kirna Zabête. After the repeat offender thieves were arrested, she asked about the prospect of retrieving any of the stolen merchandise but learned it had already been resold via consignment shops.
”I don’t know what the answer is. But having your team afraid to go to work is no way to live in America in this day and age,” Buccini said.
Despite the challenges caused by theft and the pandemic, the SoHo store’s business is up 30 percent compared to 2021, which was the best year to date, she said. “It’s frustrating that we’re trying to get back, get people back in the stores shopping again and then this is just one more hurdle that we had to deal with,” Buccini said.
Noting how $750,000 worth of merchandise was stolen during June 2020, Buccini recalled thinking at the time that it was a horrible period and an isolated incident. “Since then, it just feels like a regular pattern of people running in, grabbing and taking things. It’s not just high-end stores. It’s every drugstore in New York, too,” she said.
Two weeks ago criminals stole $40,000 worth of vintage handbags from Designer Revival, which is located at 324 East 81st Street in Manhattan. Noting how the stolen goods included handbags from Louis Vuitton, Chanel and Hermès, Jaindl said, “They knew what they were doing. They spent quite some time — almost an hour — jiggering our gates before they broke through. We have alarms. We have video footage of the burglars as they smashed through.”
The New York City Police Department is investigating the recent break-in.
Wearing hoodies, hats and masks, the criminals were not very distinguishable based on the video, which prompted the employees to try to take a closer look at their footwear. After a theft in January, one sales associate instinctively chased the person and grabbed their backpack, which was filled with stolen handbags, but the chief executive officer and others at the store cautioned him to never do that again. “We’re a small store on the Upper East Side. It’s like a family. If someone steals something, it feels so wrong and violating,” Jaindl said.
Designer Revival is located on the Upper East Side of Manhattan.
She said the suspects are believed to be organized criminals, who are targeting independent retailers as well as other small operations, like a bakery. The retailer has insurance, but is still waiting for claims from 2020 to be reimbursed. And filing too many claims runs the risk of being dropped by an insurer, she said.
Locking up more merchandise is one way Designer Revival is dealing with the issue. “We’re not going to let this take us down. We’re still feeling optimistic. You just pick up the pieces — literally — and move on,” Jaindl said.
Last fall, What Comes Around Goes Around had $385,000 worth of designer goods stolen from what was initially a Wooster Street pop-up shop and is now a permanent store. Thieves broke through a wall in the basement to access back inventory, which is now stored in locked cages. It is believed that they had been in the building before, according to Guevara. In response, all visitors to the building must now show identification and sign in. With two stores in New York and one in Beverly Hills, the retailer has also beefed up security and added cameras, among other things.
He said, “We’re a luxury retailer in SoHo. All of the luxury retailers have been targeted in the past year or two. I don’t think it’s anything specific with us. People just want high-end bags. In my opinion, it would be because of the retail price. They are all relatively traceable. We were able to trace them quickly when they tried to resell them.”
The nighttime theft rattled and shocked employees, he said. “A big part of it for the employees was, ‘Well, who was it?’ Did I meet them or know them?’ It was a trust-driven thing where they felt very betrayed,” Guevara said, adding that each employee shared their concerns.
WCAGA has ramped up its security system, added security guards seven days a week at all locations and now keeps doors locked at all times to let people in one by one. That also mitigates COVID-19 risks, he added.
Derek Friedman, who owns 12 Sportsfan and Sock Em’ Sock Emporium stores in Colorado and Texas, said the company has been dealing with break-ins, looting including “people coming in armed with machetes and things,” as well as attempted break-ins and more brazen shoplifting, where employees’ objections are ignored.
In February, the retailer instituted a Denver crime spike fee of 1 percent for every transaction in select stores, where thefts and loss have increased. Although the fee only covers a little of the losses, it sends a message, Friedman said, adding the past four months have resulted in $10,000 to $15,000 of lost merchandise in the most impacted stores, which is slightly less than the same period last year.
Holding shoplifters to a similar standard of those engaging in other unlawful activities such as a violent crime or otherwise is needed, Friedman said. While the victims of retail theft are too often mis-characterized as “just a company,” he said the victims actually are the employees and business owners. “In our case, they [the staff] lost bonuses and pay increases. I went almost two years without taking pay. I was just living on retirement [funds]. It was coming to a crescendo as we were trying to recover from COVID[-19].”
Unlike from 2014 to 2019, when there were normal levels of shoplifting and theft, Friedman said there is “a different kind of shoplifting — armed shoplifting or shoplifting that doesn’t even pretend to acknowledge that this is against the law or that they could suffer some consequence.”
Friedman attributes the behavioral change to the threshold of what is a deemed a misdemeanor versus a violation, as well as whether the accused are being held following their arrests. In 2020, Colorado lawmakers eliminated cash bail for minor offenses.
“There aren’t that many criminals or bad-doers in our society. Most of us do what we’re supposed to do, try to live our lives and do what’s right. But if you keep letting this really small segment of our population that are criminals right back out on the streets, they’re just going to do what criminals do,” he said. “The first thing is to hold people accountable, and to enforce the laws. Put the criminals in jail and give them the opportunity to learn from their mistakes and hopefully come out the other side and find something more productive to do with their lives.”
In February in Seattle, Sneaker City shuttered its Pike Street store after more than 20 years in business. Ongoing incidents of theft and a monthly rent hike to $13,000 from $8,000 for the 1,800-square-foot location factored into that decision, according to Caroline Cho, whose family owns the company. Having faced at least 24 incidents of broken glass windows in the past two years, Cho said she had glass companies on speed dial and that insurance claims weren’t worthwhile because they typically amounted to $50 or $100.
“It’s just too hard to do retail in a city, where if someone steals less than $1,000 worth of merchandise, it doesn’t matter. They’ll get a slap on the wrist. That’s about it,” Cho said.
As an independent store without a loss prevention team, Cho and her employees were “very vigilant” about deterring shoplifters. While only one pair of sneakers was stolen each month, the attempts were multiple times a day. To try to combat that, staffers would only give shoppers one shoe to try on at a time. Knowing that larger companies have trained employees to just let shoplifters go, many thieves think that every business is like that, Cho said. “But I tried to protect my inventory as much as possible.”
When people tried to steal merchandise, Cho would personally confront them. “I would scream and yell. One of them tried to threaten me. I didn’t take that lightly so I said, ‘Try me,” she said.
Asked if she was concerned for her safety, Cho said, ‘No, I’m concerned for theirs. If they want to come after me, there will be a fight. Most times they do that — it’s just words.”
She also claimed that some retailers or officials will overlook thefts of under $1,000 on the premise that those goods were stolen by the impoverished to pay for money to get food. Or such incidents might result in a fine from the police that the thieves can’t afford to pay. Cho added that there are a lot of mentally unwell people in Seattle in need of professional help.
Asked how other independent stores might deal with theft, Cho advised that the more they engage with customers, the less theft there will be during store hours. “More importantly, find a way to take care of the stress and your mental health from it because it’s very taxing.”
While Seattle officials have been vocal about how the city is being cleaned up and is returning to the way it was, Cho said they are trying. “But this issue is going to take longer to fix than it took to get to this point. Part of the reason they’re doing this is because we need the tourist money that we don’t have for a lot of reasons. At first, it was because of the pandemic but now crime has gotten worse during the pandemic. People who are coming to visit should just stay vigilant when you are here. It’s the not the way it used to be before the pandemic, even though the city says it is.”