Target to Shutter Nine Stores in Major Cities, Citing Concerns Over Violence and Theft
Retail giant Target has announced the closure of nine stores located in major cities across the United States, citing concerns related to violence, theft, and organized retail crime. The affected stores include one in New York City's Harlem neighborhood, two in Seattle, three in the San Francisco-Oakland area, and three in Portland, Oregon. These stores will cease operations permanently on October 21.
In a news release, Target explained that the decision to close these stores was prompted by the increasing threat of theft and organized retail crime, which has not only jeopardized the safety of their employees and customers but also negatively impacted business performance. The company acknowledged the essential role its stores play within their communities but stressed the need for a safe environment for both employees and shoppers.
Target, with nearly 2,000 stores across the U.S., has been vocal about its struggle with organized retail crime, which has resulted in higher levels of "shrinkage" — a term used to describe losses from damaged, misplaced, or stolen goods. In the second quarter of the fiscal year, CEO Brian Cornell disclosed a significant rise in organized retail crime incidents at Target stores, estimating that shrinkage would reduce the company's full-year profitability by over $500 million compared to the previous year.
Despite these challenges, Target initially expressed reluctance in closing stores, emphasizing the importance of their locations in terms of creating local jobs, generating taxes, and serving local communities. However, the escalating issue of organized retail crime led Target to take this unprecedented step.
Target's decision to close stores and its candid acknowledgment of the impact of retail crime has prompted other companies to address the problem and advocate for legislative reform. The passage of the Inform Act, which mandates online marketplaces to disclose the identities of high-volume sellers to deter the sale of stolen and counterfeit goods, has paved the way for initiatives like the Combating Organized Retail Crime Act, a bill supported by Target.
This proposed legislation seeks to impose harsher penalties for theft offenses, change the threshold for federal theft cases, and establish the Organized Retail Crime Coordination Center to facilitate information exchange among retailers and law enforcement.
In response to the growing issue of organized retail crime, several states have passed laws since 2022, with more following suit in 2023, to impose stricter penalties for such offenses. Retailers and trade associations are actively involved in advocating for and shaping this legislation to address the challenges posed by organized retail crime.