Home Depot executives say planned criminals are theft millions of dollars’ worth of goods from chain stores and other retailers and storing them in warehouses. Home Depot Inc. is one of the largest retailers of home improvement in the US, which supplies tools, services and construction products.
Executives said in talks with analysts and investors that retailers described the theft as “shrinking,” and that the situation has become so bad that it will shrink Home Depot’s operating margin next year. According to the CEO, Mr. Craig Menear said that this shoplifting is happening in almost all retail stores. It could be also because of the opioid crisis that is going in the United States. Home Depot’s entry is the first time a major US retailer has explicitly stated that the opioid epidemic is one of its factors in financial performance. A report from the National Retail Federation shows that retailers lose about $ 51 billion in sales each year due to shrinking. The report found that the so-called “organized retail criminal activity” has increased in the past two-thirds of retailers. Bob Morca, Vice President of Association of Loss Prevention, said that crimes like shoplifting are very much organized and are continued in the retail industry. Most retailers have security systems in their stores, but the more natural way to steal stolen goods online obviously makes criminals bolder. Executives said on the phone that in one example, a thief in Rochester, New York, was arrested for $ 16.5 million worth of goods, of which $ 1.4 million came from Home Depot. In response, the Atlanta-based company is using technology including machine learning, to predict the subsequent development at the crime scene. It is also installing technology so that power tools will not work unless they pass through the retailer’s point of sale system, then work with local law enforcement and remove some high-value inventory from the premises of the sale.
The company’s forecast includes sales guidance for the next financial year, lower than the forecast provided at the beginning of 2018, and the retailer’s stock price fell 3% on Wednesday.