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In the coming weeks, a giant food market in D.C. will clear its beauty and health aisles of all national labels. No more Tide, Colgate or Advil, just store brand. Shoppers must show their receipts to an employee before leaving the store.
It’s the regional supermarket chain’s most open bet against the rampant thefts that are plaguing retailers of all sizes. It’s also a possible last-ditch effort to avoid closing the unprofitable store on Alabama Avenue—the only major grocery store east of the Anacostia River in Ward 8.
“We want to continue to serve the community, but we cannot do so at the level of significant harm or risk to our associates,” said Ira Kreiss, Giant’s president.
Store theft, organized crime and violence have become significant concerns for regional and national retailers. Home Depot, Target, Lowe’s, Dollar Tree, Dick’s Sporting Goods and Ulta are among the companies that flagged shrinkage — a decrease in inventory caused by something other than sales — during their second-quarter earnings calls. The mounting losses have prompted giants like Walmart to shut down their businesses.
“Our teams are facing an unacceptable amount of retail theft and organized retail crime,” Target chief executive Brian Cornell told investors last month. “During the first five months of this year, our stores saw a 120 percent increase in burglaries involving violence or threats of violence.”
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In recent months, stores across the country have been targeted by flash-mob robberies, after-hours vandalism and theft in the middle of the supply chain. Had to deal with multiple target locations Bomb threats and shootings as a result of participating in Pride Month.
According to a study by the National Retail Federation released last year, incidents of organized retail crime increased by an average of 26.5 percent in 2021. Organized retail crime was responsible for nearly half of the $94.5 billion in retail losses that year by store owners, the report said.
This has led retailers such as Dollar Tree to take “a very defensive approach to shrinking,” according to chief executive Richard Dreiling. The chain reported a 30 percent decline in gross profit margin last quarter, largely due to shrinkage. Now more items will be locked away, moved behind counters or simply locked away.
In downtown Chicago, Walgreens debuted a new anti-theft store with only two aisles of “low-value” products like Band-Aids, snacks and batteries, while the rest is placed behind a counter and can be ordered digitally. Must be ordered.
Grocers like Giant run on low profit margins, so high costs of operations, labor and rent can create extreme pressure. This has forced some retailers to close stores in large urban centres. Prior to the closure of its downtown San Francisco location, Whole Foods offered customers a range of items such as alcohol, supplements and other high-value merchandise. Manuka honey from the back, a former manager told The Washington Post.
(Whole Foods’ parent company, Amazon, was founded by Jeff Bezos, who owns The Post. Interim CEO Patty Stonecipher sits on Amazon’s board.)
Giant Foods, which has 165 supermarkets in DC, Delaware, Maryland and Virginia, has not closed any stores. In May, it implemented a number of changes, including hiring more security guards, closing secondary entrances, limiting the number of items through self-checkout, reducing the number of stolen items off the shelves, and locking up more products. to do is included.
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Kress said of the shrinkage, “In this particular store, it’s actually worse, not better.” “And we’ve invested a lot of money here, there’s also more security here than any other store.”
That means more changes are needed, Kress said. The Giants’ Alabama Avenue store will soon remove high-steal merchandise such as Tide laundry detergent, Schick razor blades, Dove soap, Degree deodorant and Pantene shampoo to prevent losses.
“We have no other choice,” Diane Hicks, senior vice president of operations, said Thursday during a walk-through with the D.C. mayor’s office, the Metropolitan Police and officers. Fire Department, and Chamber of Commerce. Other nearby stores have stockpiled all their products in those aisles or removed them altogether, he said. “I’m leaving it up to my customers and unfortunately it forces all the offense to come to us.”
Those products are easier to steal or have a higher resale value, Kress said. Instead, customers can buy Giant’s private label CareOne, which has a lower resale value.
“I do not want to do this – I would like to sell [those products]” she said. “But the reality is, Tide is not a profitable item in this store… In many cases, people stock up on the product and it runs out within two hours, so it’s on the shelf anyway. Not there.”
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Some members of the D.C. Council have expressed concern that Giant could close the store serving a ward of more than 85,000 people. Not only is a supermarket like Giant an important part of the community, it is also a lifeline for a community with limited access to quality food.
Deputy Mayor for Public Safety and Justice Lindsay Appiah, who was among officials who visited the store on Thursday, said theft and violence are an issue in the area surrounding the store. But having access to the grocery store is “critical for public health purposes,” so his office plans to work with Giant to find a solution.
“Part of what we’re trying to do is create thriving communities,” he said. “We certainly don’t want to lose a center for that community and we don’t want people to be affected by the actions of those people.” Unnecessarily suffer for the small minority who are causing this disruption.”