In recent weeks, retailers have spoken out about retail crime affecting their bottom line. So, are we in a crime wave? Not really. Don’t forget to subscribe to the Glossy Podcast for interviews with fashion industry leaders and Week in Review episodes, and the Glossy Beauty Podcast for interviews from the beauty industry. –Danny Parisi, sr. fashion reporter
Are we really in a shoplifting epidemic?
In earnings reports over the last few weeks, multiple retailers have mentioned “shrink,” the industry term that covers goods lost due to shoplifting, employee theft and damage. Nordstrom said retail theft for the company in the last quarter was at an all-time high, and Dick’s Sporting Goods and Ulta Beauty also mentioned shrink due to theft as an increasing problem. In recent months, other large companies like Target have said retail crime was affecting their earnings, too.
Inevitably, conversations about retail theft can be tricky. Advocates for harsher policing often point to sensationalized stories of blatant shoplifting as evidence that we’re too lenient on crime or that big cities like New York are lawless wastelands.
But while retail shrink is a real issue, it’s worth it not to get too wrapped up in the sensationalization. For one, the majority of shrink is not actually shoplifting. Instead, experts have said that the majority of retail theft happens at a larger level, with organized groups stealing product in bulk earlier in the supply chain — whether from factories or warehouses — before it ever reaches the store.
Additionally, some of the same companies that have complained about retail crime in the past have admitted that the problem has been overstated. In January, Walgreens CEO James Kehoe told investors during an earnings call, “Maybe we cried too much,” admitting that the problem of shoplifting and retail theft was not as dire as the company had made it out to be in previous reports.
Finally, there’s the fact that the numbers, taken together, don’t quite add up to an epidemic. The Atlantic had a great breakdown of how moves like conflating multiple types of crime and comparing data to 2020 — a year where basically nothing was happening — can make it look like we’re in the middle of a massive crime wave. But in reality, shoplifting rates have hardly increased at all in almost 10 years.
Retail shrink is indeed a problem, and crime is certainly an issue when it puts retail employees in danger. But some of the breathless stories about shoplifting don’t quite tell the whole story.
Luxury watch prices keep falling
Luxury watch prices continue to fall, especially among the most expensive brands like Rolex and Patek Philippe. The Bloomberg Subdial Index, which tracks luxury watch prices, has fallen by 14% in the last year. Prices decreases started in March of 2022.
The reasons for this are manifold, and I’ve written about several of them for Glossy. Less spending on luxury goods across the U.S. is one element, as is the flood of new inventory to the used watch market and the crash of various cryptocurrency markets.
Shein teams up with Sparc Group
Shein became even more dominant in global fashion last week when, on Thursday, it announced a strategic partnership with Sparc Group. Sparc is the joint partnership between two other giant companies, Authentic Brands Group and Simon Property Group, and owns retail companies like Aeropostale, Forever 21, Brooks Brothers and Nautica.
The partnership will see Sparc becoming a minority shareholder in Shein and Shein taking a one-third ownership of Sparc alongside Authentic and Simon. The partnership will likely focus on expanding the e-commerce reach of both Shein and Sparc’s brands.
Despite the criticism Shein has faced in recent months, it has continued to grow, now reaching around 150 million online customers monthly.
