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Mister Fister posted:Gonna piggyback off this, as the issue of retail theft has been bothering me for some time. Something i saw a little while ago: Reddit subs are a cesspool. But 2.2 average net profit is deducting all the stores annual and amortized expenses. It's a little bit dishonest because it already deducts losses from existing levels of theft. Vague Internet anti corporatism posting as praxis has become the norm. Corporate propaganda has replaced actual anarchism with their own cartoon version of it that just exists to steal poo poo. Congratulations to them for playing themselves like that. E: you would also expect shrinkage growth to closely match sales growth and shrinkage losses to match profitably changes. An economic disruption increases all crime, the numbers will normalize if the economy does. Barrel Cactaur fucked around with this message at 18:36 on Oct 19, 2023 |
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Oct 19, 2023 18:29
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Right, how much profit did Lowe's make last year, despite this shrink epidemic? 32 billion. Get the heck outta here
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Oct 19, 2023 18:30
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Mister Fister posted:$25,000 * 2% = $500 (the other $24,500 would cover cost of goods sold + overhead like SG&A). That math is right for the potential total value lost to the store if the meat had been purchased instead of stolen. But, the actual loss to the store is the total cost of the meat and not the sticker price. Your point about businesses with very small margins being disproportionately impacted by retail theft is true, but are non-prescription items at pharmacies low margin? Grocery stores and Wal-Mart are low margin businesses, but I was under the impression that pharmacies heavily markup their non-prescription items and make most of their money from pharmaceuticals. Also, Rite-Aid specifically isn't hurting because of retail theft. It is because of competition from other pharmacies and its mounting legal problems. I think your general point (specific types of businesses with low margins are more directly impacted by even small amounts of retail theft increases) is true, but not applicable to Rite-Aid.
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Oct 19, 2023 18:30
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Lower staffing at these stores directly leads to more opportunities to steal. 2013 to now seems to coincide with the rise of self checkout too. These companies consistently understaff and take every opportunity to cut corners. Maybe they need to take some personal responsibility about their business practices. Employee theft is a significant portion of shrink also. More and higher paid (higher loyalty) employees would help the situation but that involves spending money that could go back to investors.
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Oct 19, 2023 18:30
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Heck Yes! Loam! posted:No they need to cover the cost of the meat Sigh. Ok, $500 * 98% (based on 2% margin) = $490 cost of the meat (Cost of goods sold and overhead). So you have to sell $24,500 to cover that loss ($24,500 * 2% margin = $490). It doesn't really diminish my point that much.
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Oct 19, 2023 18:30
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Heck Yes! Loam! posted:Right, how much profit did Lowe's make last year, despite this shrink epidemic? 32 billion. But if number doesn’t go up….
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Oct 19, 2023 18:32
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Mister Fister posted:The 1-3% profit margin is average for all goods sold. Obviously, some goods have higher margins and some goods have lower ones. The margin on any particular good is not really something that's relevant. Pretend i didn't say 'meat', and just said 'random goods'. Walgreens did, yes. https://www.cnn.com/2023/01/06/business/walgreens-shoplifting-retail/index.html They wanted to close stores in those locations, made up stories about shoplifting forcing it and then walked back on it. So yeah, I think the chains wanted to close and then made up classist lies about places like DC, Oakland, and SF because they explicitly did that and admitted to it.
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Oct 19, 2023 18:32
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Mister Fister posted:Sigh. Ok, $500 * 98% (based on 2% margin) = $490 cost of the meat (Cost of goods sold and overhead). So you have to sell $24,500 to cover that loss ($24,500 * 2% margin = $490). It doesn't really diminish my point that much. It absolutely does...
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Oct 19, 2023 18:32
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Heck Yes! Loam! posted:
Also, most shrink in stores is explicitly not "a customer walks in the store, grabs a side of beef and walks out the door" and more so other factors, both internal and in the supply chain. The way the numbers play out make it sound like shrink is on par with normal trends and the one thing that shows an increase is reports of violence - and I don't know if that's actually an increase, a normalization of reporting violence, or purposely overreporting to justify these companies doing the thing they already wanted to do (namely, close stores / restrict hours to bring staffing and property expenses down and push shopping to online spaces to save money). https://www.cnbc.com/2023/09/26/organized-retail-crime-and-theft-not-increasing-much-nrf-study-finds.html
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Oct 19, 2023 18:33
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So is it one guy with a tactical trench coat stealing over 100 pounds of beef at a time multiple times a day or is multiple people working in shifts?
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Oct 19, 2023 18:34
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Heck Yes! Loam! posted:Right, how much profit did Lowe's make last year, despite this shrink epidemic? 32 billion. that's gross profit from stores, before a lot of expenses (including taxes). their net income was $6.5 billion
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Oct 19, 2023 18:36
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I think there's two stories here:
The corporate dream is a grocery store with no employees, people just come in after registering. They're watched by cameras that record their purchases and leave with minimal labor cost. And we're seeing that there are fewer cost savings as stores move towards that model.
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Oct 19, 2023 18:36
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Heck Yes! Loam! posted:Right, how much profit did Lowe's make last year, despite this shrink epidemic? 32 billion. That's gross profit and not net profit. Net profit was $6.5 billion in 2022 ($8 billion in 2023). That would be about 1/8th of the net 2023 profit lost to theft according to the Twitter guy. That is pretty significant, but your point about it not bankrupting the company is also valid.
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Oct 19, 2023 18:36
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FizFashizzle posted:So is it one guy with a tactical trench coat stealing over 100 pounds of beef at a time multiple times a day or is multiple people working in shifts? $500 was an example. The arithmetic would be the same if they stole a snickers bar.
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Oct 19, 2023 18:37
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FizFashizzle posted:okay average national cost of 100% ground beef (for example) is 4.80/pound, per quick google search. Yes? I was visiting family in DC a while back and they told me that a few Giant Foods markets are threatening to close a few locations because people just walk out of the store with carts full of food multiple times a day every day (and showed me the news articles about it). I just used beef as an example because i remember seeing news stories about how grocery stores in some high crime cities locking up meat like this: https://www.youtube.com/watch?v=4Ljvk90sYH0
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Oct 19, 2023 18:37
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FizFashizzle posted:So is it one guy with a tactical trench coat stealing over 100 pounds of beef at a time multiple times a day or is multiple people working in shifts? I think the idea is that in every town and city across America (except yours because you are lucky to live in a safe one so you've never seen this actually happen) organized crime is ransacking these stores and shoplifting in mass. It's important that it is always happening in places across the country except in places where you personally would see it.
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Oct 19, 2023 18:38
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TheDeadlyShoe posted:that's gross profit from stores, before a lot of expenses (including taxes). their net income was $6.5 billion Thank you. A company making 6.5 billion probably shouldn't be whinging about shrink losses.
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Oct 19, 2023 18:38
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Heck Yes! Loam! posted:It absolutely does... I'm sorry but how is the difference of $25,000 vs $24,500 in sales needed to cover shrink a big deal?
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Oct 19, 2023 18:38
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FizFashizzle posted:So is it one guy with a tactical trench coat stealing over 100 pounds of beef at a time multiple times a day or is multiple people working in shifts? When Jameis Winston stuffed those crab legs down his pants, he single-handedly sent Publix into chapter 7 bankruptcy
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Oct 19, 2023 18:38
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Lowes spent 14 billion on stock buybacks in 2022. Basically wage theft from labor. So gently caress them, steal more.
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Oct 19, 2023 18:40
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Lowe's increased their dividend by 596 million dollars annually in 2022. The increase in shrink is a fun thing for a company to point at but it isn't a significant driver of their overall business.
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Oct 19, 2023 18:42
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funkymonks posted:Lowes spent 14 billion on stock buybacks in 2022. Basically wage theft from labor. So gently caress them, steal more. Hahaha Oh no we have to close stores and fire thousands so we can maintain our profit margin and shares, why have you done this to us shoplifters!
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Oct 19, 2023 18:44
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Grocery chains and places like Lowes steal from employee wages, coordinate to raise prices across the board, and destroyed small businesses across the country on purpose to become the only choice and cause the loss of countless jobs and even entire towns. I do not care if they cry about "shrink", especially when shrink is a made up term that includes anything they want it to and is absolutely not a measure of how much theft is happening. If you see shoplifting, you didn't.
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Oct 19, 2023 18:44
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Mister Fister posted:The 1-3% profit margin is average for all goods sold. Obviously, some goods have higher margins and some goods have lower ones. The margin on any particular good is not really something that's relevant. Pretend i didn't say 'meat', and just said 'random goods'. The only reason to pretend you said random goods is because you need to disregard a host of complicated variables to make a very simple napkin math claim a compelling and interesting argument. Companies incorporate anti-theft measures on some items and not others; hire workers to wander and watch over and inventory some items and not others; put some items on sale because they sold the top half of the pallet at a high price level and now need to clear out the pallet to maks room for other items taking up space on the shelf and warehouse. The entire exercise at this point is to make one assumption (expected profit is a universal law that all other math must bend towards) and then try to argue about the arithmatic and disregard any attempt to introduce other variables.
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Oct 19, 2023 18:44
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It’s pretty telling (to me; and some other posters it would seem) that these massive chains feel no obligation to comment on what’s changing in our country to drive these increases in theft (again, if you believe the reports are entirely honest) while being willing to make changes to their hiring, staffing, store opening/closing, store location and loss-prevention policies, all of which collectively drive changes in society. If you constantly cut staff at a Wal Mart, and replace them with self-checkout, you’ve done several things that affect your local community: -removed jobs, and thus the ability of those employees to shop where they worked. This means you’ve not only got one person who can no longer afford to shop there, but entire families. -made the customer feel more alienated by forcing them to get one of those staff who are increasingly harder to find to unlock a cabinet so they can get shaving cream. why would I respect the store that treated me like a criminal just for walking in? -the removal of stores in my area means the places that I do go to don’t employ anyone I know, and feel even less connected to my local community than the already-tenuous connection a big box store can have anyway. -Price increases and gouging make consumers feel even more pressed and unable to maintain what they previously saw as the bare minimum, and asks them to accept a new bare minimum. I just can’t be made to care what’s happening to Wal Mart when what’s driving their view is a situation they had a not-insignificant part in creating. Sorry this community can’t be sucked any drier, and has started sucking back, not my problem! People will make a judgment call about how much they want or need something, and the risk of getting it. It’s the same reason why everything on your phone is a route for someone to scam you. There’s a horde of exploitable resources out there (Americans with poor data security and money) and the risk/reward calculation driving those scams is very similar to the ones being performed by exploitative western colonial powers all throughout modern history. They just figured out a way to do it that doesn’t require guns or enormous economic advantages of scale to exploit a lesser power. The lesser power here in modernity is the person being scammed, and the reason it’s so common is that our society has had the copper stripped out, and our political systems are so calcified there’s no push or even maybe a credible mechanism to end it. Same with shoplifting; what are you gonna do, hire more cops who won’t do their jobs? What’s your other option?
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Oct 19, 2023 18:44
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Mister Fister posted:Yes? I was visiting family in DC a while back and they told me that a few Giant Foods markets are threatening to close a few locations because people just walk out of the store with carts full of food multiple times a day every day (and showed me the news articles about it). I just used beef as an example because i remember seeing news stories about how grocery stores in some high crime cities locking up meat like this: This is a solved problem. Hire more people to stand at the exits and say "show me your receipt or I'm calling the cops. You're on camera." This will deter that kind of theft. These companies don't care enough to take this relatively small step. It's a media phenomenon that companies are willing to play into but not significant to the overall picture.
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Oct 19, 2023 18:45
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Heck Yes! Loam! posted:Thank you. It's a localized problem. If some cities are low crime and profitable but some cities are high crime and are unprofitable, those stores are in danger of being in the red and need to close, which hurts the local economy (and citizens who depend on it via jobs and low cost necessities).
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Oct 19, 2023 18:45
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Gumball Gumption posted:I think the idea is that in every town and city across America (except yours because you are lucky to live in a safe one so you've never seen this actually happen) organized crime is ransacking these stores and shoplifting in mass. It's important that it is always happening in places across the country except in places where you personally would see it. Awww dammit I misread this post initially and was about to post about how I used to buy groceries at a place called Murder Kroger (rip)
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Oct 19, 2023 18:46
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This does square up with the thing we keep seeing where a company says "oh no so much theft store must close" and later it turns out theft was not actually higher at the stores they closed than the stores that stayed open. You close underperforming stores, and a constant amount of theft is going to hit an underperforming store harder at the margins. But if theft is just uniformly up across the country without regard to local politics, trying to rein it in one store at a time is a bit of a fool's errand.
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Oct 19, 2023 18:46
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Mister Fister posted:Sigh. Ok, $500 * 98% (based on 2% margin) = $490 cost of the meat (Cost of goods sold and overhead). So you have to sell $24,500 to cover that loss ($24,500 * 2% margin = $490). It doesn't really diminish my point that much. You can’t factor in the overhead portion. That’s relatively static whether there is theft or not.
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Oct 19, 2023 18:46
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Artonos posted:Lowe's increased their dividend by 596 million dollars annually in 2022. The increase in shrink is a fun thing for a company to point at but it isn't a significant driver of their overall business. Technically, both can be true. Theft isn't impeding their viability as a business (even if it is now 2x what it was in 2013), but they also lost the equivalent of roughly 1/8th of their profits to theft. Losing a billion dollars is still something for the corporation, shareholders, and individual franchisees to be upset about. Edit: Also, is Lowe's a particularly low-margin per unit sale business? Grocery stores are hit harder by shoplifting, but I don't know what the per unit markup is for the average product at Lowe's - or at least the most commonly stolen items at Lowe's. It's probably higher than the 1-3% that grocery stores have (as evidenced by the still sizable profit despite increased loss to theft). Leon Trotsky 2012 fucked around with this message at 18:50 on Oct 19, 2023 |
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Oct 19, 2023 18:47
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Artonos posted:This is a solved problem. Hire more people to stand at the exits and say "show me your receipt or I'm calling the cops. You're on camera." This will deter that kind of theft. These companies don't care enough to take this relatively small step. It's a media phenomenon that companies are willing to play into but not significant to the overall picture. CVS in san francisco has security guards standing at the exits and people still go in and clear out the shelves and walk out with the goods untouched. Ask me how i know.
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Oct 19, 2023 18:48
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Leon Trotsky 2012 posted:Technically, both can be true. Take it out of the stock buyback fund.
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Oct 19, 2023 18:48
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do other countries have this problem or is it another american exceptionalism thing?
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Oct 19, 2023 18:49
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Glazius posted:But if theft is just uniformly up across the country without regard to local politics, trying to rein it in one store at a time is a bit of a fool's errand. What? This is absolutely not true, some cities have much higher rates of theft than others. I live in a city now where nothing is locked up because crime is low. None of the stuff at my local CVS is locked up. The CVS's in San Fran are all locked up and you need to press a button to page an employee to unlock the stuff for you.
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Oct 19, 2023 18:50
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Mister Fister posted:CVS in san francisco has security guards standing at the exits and people still go in and clear out the shelves and walk out with the goods untouched. Ask me how i know. What do you think are the incentives to do that, and why have those incentives changed to make this (seemingly) more common lately, and most importantly what responsibility for the state of the economy and culture do these stores bear? Are they a part of society, does society even exist to them?
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Oct 19, 2023 18:50
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Mister Fister posted:CVS in san francisco has security guards standing at the exits and people still go in and clear out the shelves and walk out with the goods untouched. Ask me how i know. Seems like we should stop paying those cops if they are so bad at their job then. That's two cop salaries that can go to a local cause to reduce crime and increase social well-being in the community.
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Oct 19, 2023 18:50
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PhazonLink posted:do other countries have this problem or is it another american exceptionalism thing? Yes, it is an issue in Europe and Canada at least. https://www.euronews.com/2023/09/14/shoplifting-surges-in-uk-as-retail-workers-face-rise-in-violence-and-abuse
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Oct 19, 2023 18:51
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Shrink is significantly more than just theft too. So whinging about the great beef theft mafia is super disengenuous. Did an employee leave the beef out of the freezer overnight and it's no longer safe to sell? That's shrink. Did they order 10 beefs and they only received 7? That's shrink. Did the manager cut some off for the company BBQ? Guess what? Most companies list all of these sorts of factors together and then say "all of this theft is out of hand" despite relatively little of it being actually theft.
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Oct 19, 2023 18:51
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DeathSandwich posted:Shrink is significantly more than just theft too. So whinging about the great beef theft mafia is super disengenuous. Exactly. Sure theft happens, but it isn't the reason stores are closing.
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Oct 19, 2023 18:52
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