“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 in a news release.
Some employees will have the opportunity to transfer to other stores, the company said.
Target has been vocal about its troubles with theft and organized retail crime. Chief executive Brian Cornell said on a second-quarter earnings call last month that stores saw a “120 percent increase in theft incidents involving violence or threats of violence” during the first five months of the year.
Target said in May that shrink — the depletion of inventory caused by something other than sales — accounted for $500 million in losses. But Michael Fiddelke, its chief financial officer, did not specify how much for that can be attributed to external theft.
Shoplifting, organized crime and violence have become significant concerns for regional and national retailers. Home Depot, Lowe’s, Dollar Tree, Dick’s Sporting Goods and Ulta are among those that flagged shrink during recent earnings calls. Growing losses have spurred giants such as Walmart to also shutter locations.
External theft accounted for an average of 36 percent of shrink-related losses at physical stores in 2022, according to the National Retail Federation’s security survey.
“The situation is only becoming more dire,” David Johnston, the retail federation’s vice president for asset protection and retail operations, said in a news release Tuesday. “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.”
In total, shrink cost retailers $112.1 billion in losses last year, up from $93.9 billion in 2021, according to the survey. But over half of those losses are attributed to employee theft and operational and processing errors, which accounted for 29 and 27 percent, respectively.
In recent months, stores across the country have been targeted by flash-mob robberies, after-hours break-ins and thefts mid-supply chain. Target said it has made several changes to help combat theft and organized retail crime, including hiring more security team members, using third-party services, locking up certain merchandise and investing in training employees in protective measures and de-escalation techniques. The company also invested in technology updates to better detect and track cybercrimes.
The company was also involved in the recently passed the Inform Consumers Act, which took effect in June and requires online marketplaces to report and verify information about high-volume third-party sellers.
Target has faced issues unrelated to theft this year. Several store locations grappled with bomb threats and swatting incidents after participating in Pride Month.
Some retailers have taken other approaches to combating theft. To avoid shutting down an unprofitable store, regional grocery chain Giant Food is removing all national labels products from its beauty and health aisles and implementing receipt checks at the door. The company has already hired more security guards, closed secondary entrances and limited the number of items permitted through self-checkout areas.
Dollar Tree chief executive Richard Dreiling said the retailer is taking “a very defensive approach to shrink.” The chain recorded a 30 percent decline in gross profit margin last quarter, largely because of shrink. Now more items will be locked up, moved behind counters or simply discontinued.
In downtown Chicago, Walgreens introduced a new anti-theft store with just two aisles of “low-value” products such as Band-Aids, snacks and batteries, while the rest are kept behind a counter and must be ordered digitally.
