Target: ‘Organized retail crime’ drove astounding $400 million loss in profits this year

Target stores are getting looted, and it’s taking a huge bite out of profits.

The discount retailer told reporters on a call to discuss its third quarter earnings results that inventory shrinkage — or the disappearance of merchandise — has reduced its gross profit margin by $400 million so far in 2022.

“There’s a handful of things that can drive shrink in our business and theft is certainly a key driver,” Target CFO Michael Fiddelke said. “We know we’re not alone across retail in seeing a trend that I think has gotten increasingly worse over the last 12 to 18 months. So we’re taking the right actions in our stores to help curb that trend where we can, but that becomes an increasing headwind on our business and we know the business of others.”

A Target spokesperson told Yahoo Finance via email after the call the shrinkage was mostly “organized retail crime.”

US retail chain market Target is seen on December 23, 2013 in New York, NY. (Photo by Mucahit Oktay/Anadolu Agency/Getty…

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This article was written by and originally published on finance.yahoo.com