BAKERSFIELD, Calif.(KBAK/KBFX) — Organized retail crime goes beyond a single shoplifting incident, involving groups that steal merchandise from multiple stores with the goal of reselling it for profit — and a CSUB economics professor says the fallout can reach consumers.
A discovery of over $10,000 in stolen merchandise in a Bakersfield motel room left six people arrested. PHOTO: BPD
“Probably the biggest impact of retail theft is the costs are passed on to the law abiding citizens who buy these products,” said Dr. Richard Gearhart, an economics professor at California State University, Bakersfield.
Gearhart said retail theft is estimated to cost businesses between $70 billion and $100 billion annually in the United States. To make up for those losses, he said businesses may raise prices.
A reported theft at an Ulta Beauty store in the D.C.-area. (Fairfax County Police Department)
“Businesses typically raise their prices by about 20% due to high levels of retail theft,” Gearhart said.
Beyond higher prices, the FBI website says organized retail crime can also reduce local tax revenue, contribute to store closures, and create health and safety concerns if stolen goods are improperly resold.
Gearhart said small businesses often feel the impact most acutely.
“A small local mom and pop may only have five products that they have and if a thief takes two of them, they’ve lost 40% of their inventory and they probably don’t have the cash to be able to replace those immediately and will likely close,” he said.
FILE – Dramatic rise in California retail theft prompts action from lawmakers. (CA{ }Senate Republican Caucus)
He added that rising prices should not automatically be viewed as businesses taking advantage of consumers.
“I don’t necessarily think that this is a business is taking advantage of consumers. This is business suffering some of the losses alongside the consumers,” Gearhart said.
When asked whether shoppers themselves can do anything to prevent organized retail crime, Gearhart said there is little direct action individuals can take.
“There’s really not much that you can do, organized retail theft has kind of always been a thing. Always will be a thing unfortunately,” he said.
State leaders say enforcement efforts are increasing to combat the problem. Earlier this year, Governor Gavin Newsom announced that in 2025, state officials recovered more than 270,000 stolen items through proactive operations statewide, part of broader efforts to disrupt organized theft rings.
FILE – California Gov. Gavin Newsom speaks as Attorney General Bob Bonta, second from left, looks on after signing a bipartisan package of bills to combat retail crime during a press conference with state and local officials at Home Depot in San Jose, Calif., on Friday, Aug. 16, 2024. (Ray Chavez/Bay Area News Group via AP, File)
While retail theft may not always be visible to consumers, experts say its economic effects can surface in subtle ways — from higher prices to changes in store operations.