1. For years, @walgreens@twitter.com and other major retailers have been sounding the alarm about an alleged spike in shoplifting, describing it as an existential threat to their business.
The claims generated a MEDIA FRENZY
Now, Walgreens is quietly backtracking
@Walgreens@twitter.com 2. Just a year ago, @Walgreens@twitter.com blamed their lackluster earnings on “gangs that actually go in and empty our stores of beauty products.”
There was never actually any data to support these claims.
@Walgreens@twitter.com 3. The number of shoplifting offenses actually dropped dramatically between 2019 and 2021, according to FBI stats.
And @NRFnews@twitter.com, the industry's lobbying group, found that "shrink" decreased from 1.6% of sales in 2020 to 1.4% in 2021.
4. "Shrink" covers more than just shoplifting. It also includes damaged goods and employee theft. "External theft" amounted to just 0.5% of sales across the industry in 2021, according to @NRFnews@twitter.com.
5. Now @Walgreens@twitter.com is admitting that its rhetoric didn't match the reality.
Walgreens CFO James Kehoe told investors last week that Walgreens "cried too much last year" about shoplifting and spent too much money on private security.
6. According to @Walgreens@twitter.com, total shrink in its last quarter was 2.5%.
Kehoe said he was "quite happy" with the number
We asked Walgreens how much of the 2.5% was due to shoplifting. The company didn't answer
It's likely that external theft @Walgreens@twitter.com amounts to <1% of sales
@juddlegum yup— they’re now also admitting external theft is only 37% of their shrink! Apparently the vast majority of it is their own burned out employees or disgruntled suppliers! (37% * 2.5 = 0.925 so you are right that’s be less than 1%.)
