San Francisco and nearby San Jose seem worlds apart when it comes to the challenges retailers face.
On Tuesday, Target announced it would close nine stores across the country, including three in San Francisco, as theft and organized retail crime jeopardized the safety of the retailer’s employees and customers.
In a message on X, Marina times journalist Susan Reynolds said she interviewed store workers in the Bay Area, and posted a clip of a San Jose Target that she called “thriving and orderly,” with “no police or armed guards.”
“Here’s the deal: It doesn’t happen in cities just 20-30-60 minutes away. They are not closing,” she wrote.
Located about an hour’s drive south of San Francisco, San Jose has a higher median income and lower crime and homelessness rates than the Golden Gate City.
This San Jose Target was described as “thriving and orderly” by a visiting journalist, after the retailer said it would close three stores in nearby San Francisco due to high crime rates.
In April, San Jose Mayor Matt Mahan had harsh words for the city’s northern neighbor when discussing crime control in the city.
“I say emphatically that San Jose will not become San Francisco. I think everyone deserves to live in a safe and clean environment,” he told the newspaper Mercury news.
Mahan is a Democrat, as are nine of San Jose’s 11 city council members.
Target said Tuesday it would close nine stores in four U.S. states, including California, citing theft and organized retail crime threatened the safety of the retailer’s employees and customers.
The move, effective October 21, will mean the closure of one store in New York City, two in Seattle, three locations across the San Francisco and Oakland markets and three in Portland.
Despite heavy investment in security, the company continued to face “fundamental challenges” in running its stores safely, the retailer said.
It operates nearly 2,000 stores in the United States.
“We cannot continue to operate these stores because theft and organized retail crime threaten the safety of our team and guests and contribute to unsustainable business performance,” Target said in a statement.
Minneapolis, Minnesota-based Target said it would work with all eligible employees at affected locations to provide options for transfer to other Target locations.
Theft and retail crime have become an increasingly pressing problem for American retailers, with organized crime gangs targeting store inventory and causing more financial losses for businesses.
A report from the National Retail Federation (NRF), a trade association, showed earlier on Tuesday that inventory is “shrinking” as a percentage of total retail sales, accounting for $112.1 billion in losses in 2022, down from $93.9 billion in 2021.
“Retailers are seeing unprecedented levels of theft coupled with rampant crime in their stores, and the situation is only becoming more dire,” said NRF Vice President for Asset Protection and Retail Operations David Johnston.
Retailers are being forced to close a specific store location, shorten store hours or change in-store product selection to cope with the spike in retail crime, the report said.
A Target store in San Francisco closed its health and beauty products behind security glass. A video posted to TikTok on April 20 shows the items under lock and key for customers
Dollar Tree has said it plans to remove goods such as men’s underwear, an item most susceptible to shoplifting, from its stores.
Retailers are ramping up prevention practices, with 34% of respondents increasing internal payroll to support retail crime risks and 46% increasing the use of third-party security personnel, among other measures, NRF said.
Even Britain is seeing more cases of shoplifting, with fashion chain Primark increasing spending on security guards, CCTV and equipping staff with body cameras to combat theft in its stores.
Walmart CFO John Rainey said on a post-earnings call with Telsey Advisory Group that the retailer was “putting armed guards in certain cases” in some stores in cities.
The NRF survey was conducted online among senior retail loss prevention and security leaders, with insights from 177 retail brands.
San Francisco has been an epicenter for store closings in recent months, although not all businesses specifically reported theft.
Others have noted declining pedestrian traffic downtown, which could be partly due to concerns about crime, but also a shift to remote work following the COVID-19 pandemic.