It’s not what you think: Store closings and retail crime

Recent store closings said to be due to theft and organized retail crime are misleading, meant to shift blame away from the businesses.

Read a newspaper article ten years ago about Portland, Oregon, and it will be about how bike-friendly, liberal, and creative it is.

Read a newspaper article today about Portland, Oregon, and it’s a hellscape of burned-out buildings, tent cities, and rampant crime.

Both were—and are—false.

Journalism needs an angle, a through-line to make sense of a complex world.

When Fred Armisen said that Portland is the place where “young people go to retire“, it was funny, because it showed how people’s approach to life in Portland was so different from LA or NYC, that the endless hustle wasn’t truly necessary, or even desired.

And yes, Portland has a homeless problem, but this “problem” is often really just the fact that we haven’t shoved these people out of the frame into jails and out of town centers where the average person can’t see them, unlike other cities.

Point being, it’s important to see through the narratives to the truth beneath.

And false narratives are absolutely rampant when it comes to retail stores, especially in urban areas.

For example, Target just announced that they will be closing nine stores, three of them in Portland.

Their official statement said: “we cannot continue operating these stores because theft and organized retail crime are threatening the safety of our team and guests”.

But this is a lie, and it doesn’t take much looking to uncover what’s really going on.

Retail crime, or lack of sales?

The three stores that Target are closing in Portland are all ones I’ve been in.

Here are where they’re located:

They are all of the “City Target” variety, those smaller square footage stores, designed for an urban environment that can’t support a full-sized store or parking lot.

One of them is smack in the middle of downtown, but the other two are on the east side, near major areas but not super urban. One of them was a former bowling alley, and retained some of its bowling aesthetic.

And these two stores are pointless.

Fundamentally, they misunderstand what the purpose of a Target is. Target is The Everything Store. You go in, and you know they’ll have what you need. That’s why you go.

But these small stores don’t have all that inventory. Every single time I’ve been to one of those stores, they’ve told me that “this location doesn’t have that stock”, and I’ve been directed to a larger store.

Now are you going to tell me that crime is what shut these stores down? Or is it more that people in cars aren’t going to go to those Targets in favor of larger stores with better inventory?

Retail crime, or lack of foot traffic?

The other Target (Galleria) was right in the center of downtown, which should have been perfect. Indeed, it probably was perfect for a time. I used to walk past it all the time when I was downtown.

But therein lies the problem: fewer people than ever are downtown.

The Willamette Week recently ran a story saying that downtown office vacancy rate was around 31%, the highest on record.

So it’s fair to estimate that this downtown Target probably has had a sales drop of at least 10-20%, if not 31%.

And yes, there is crime downtown; I’m not blind to it. But I think we can all agree that a 10-20% drop in sales is a bigger deal than crime—or “guest safety”—any day, at least to a corporation.

Retail crime, or not?

My assertion that Target is closing under-productive stores and is blaming it on “retail crime” isn’t that much of a spicy take.

Indeed, the National Retail Foundation, not an unbiased source, states that while there were $94.5 billion in losses in 2021, up from $90.8 billion a year before, the average shrink rate actually dropped 0.2% in that time, so perhaps the spike is hiding a drop in theft, not a gain, given higher prices.

Retail crime, or unions?

It’s not just Target.

REI, the camping outfitter store, recently announced that they will be closing their flagship store in downtown Portland, citing “an increase in break-ins and thefts in the neighborhood”.

Sounds reasonable, right?

Except it later turned out that employees of that store were looking to unionize. It’s been asserted that REI may have decided to just shut the store down and lay those people off rather than fight a public union fight.

Was crime a contributing factor? Sure maybe. But perhaps also being hostile to unions might have been a larger factor on why the closure is happening now.

It was never about crime

I don’t have any problem with stores closing, downtown or elsewhere. It’s clear that we have way more retail space than is needed, now that most people buy most things online.

What gets me really angry is the disingenuousness of the claims of why these stores are closing.

I’m not saying that retail theft, specifically organized retail crime, isn’t an issue.

But with the reporting that’s coming in beyond these headlines, like this report from Marketplace, it’s not at all clear that retail crime is even on the rise.

Companies are effectively shifting blame to their local population, when what they should be blaming is their own business models.

Those Target stores don’t make sense. They should close.

That REI store may or may not have made sense, but if it’s true that union hostility factored into the decision to close the store, then as far as I’m concerned, it’s REI itself that should be going out of business.

So the next time you hear a lofty claim like these, I invite you to look into it further. And ask yourself, “who is being Targeted here?”