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Target on Tuesday said it made the “difficult decision” to close nine locations in four states, “because theft and organized retail crime are threatening the safety of our team and guests, and contributing to unsustainable business performance.”
The stores on the chopping block—several of which are small-format stores that were opened in urban areas within the past five years—include one location in New York’s East Harlem, two in Seattle, three in Oakland and San Francisco, and three in Portland.
“We know that our stores serve an important role in their communities, but we can only be successful if the working and shopping environment is safe for all,” the company said.
The problem of theft: This March, the company announced plans to close four small-format stores in urban areas that had opened within the past five years. What distinguishes the new round of closures is that Target is pointing the finger squarely at theft and retail crime—even as its actual financial impact is relatively minor.
A new survey from the National Retail Federation (NRF) found that shrink accounted for $112.1 billion in losses in 2022, up from $93.9 billion in 2021, and that internal and external theft represented 65% of the total, the same as in recent years.
In addition, as CNBC observed, the number as a percentage of total sales has barely budged from 2021, and recent losses from heavy discounting far outweigh shrink.
Increasing violence: However, financial losses are only part of the problem. Target is also singling out a rise in violent incidents related to theft as a reason for the closures.
CEO Brian Cornell told investors during the company’s Q2 earnings call that stores saw a 120% increase in incidents of violence or threats of violence in the first five months of the year.
Target is echoing other retailers on this topic: The NRF survey found that 67% of respondents said they were seeing more violence and aggression related to organized retail crime.
“Far beyond the financial impact of these crimes, the violence and concerns over safety continue to be the priority for all retailers, regardless of size or category,” NRF Vice President for Asset Protection and Retail Operations David Johnston said in a statement.
Target did not respond to Retail Brew’s request for comment in time for publication.