Breaking News in the Industry: October 7, 2016

How Hurricane Matthew is Impacting Retail — and How Retailers are Responding

The most powerful storm to threaten the Atlantic Coast in more than a decade plowed toward U.S. shores yesterday afternoon. Already blamed for more than 100 fatalities across the Caribbean, Matthew is expected to wreak havoc up and down the eastern seaboard in the hours to come. “Extremely dangerous, life-threatening weather conditions are forecast in the next 24 hours,” the National Weather Service pronounced early Thursday afternoon. “Airborne debris lofted by extreme winds will be capable of breaching structures, unprotected windows and vehicles.”

Officials in Florida, Georgia, North Carolina and South Carolina have declared states of emergency, instructing millions of residents to evacuate. Florida Gov. Rick Scott urged residents who remain to stock up on enough food, water and medicine to last at least three days.
“This storm will kill you,” Scott warned Thursday morning. As the storm makes landfall, here’s a look at how retailers are responding to the storm — and the impacts it could have on the sector well after it passes.

Hurricane Matthew is not the first storm that retailers have weathered — and it won’t be the last. Well before Matthew made landfall, merchants large and small began bracing for the worst. Extreme weather warnings are synonymous with consumer raids on grocery stores, hardware stores and convenience stores. Reports suggest that many East Coast merchants anticipated the impact of the storm and ordered extra supplies ahead of time, but even so, some regions are already experiencing shortages of staples like water and propane. In anticipation of price gouging, North Carolina is enforcing price gouging laws to halt misconduct by manufacturers, retailers and distributors.

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Home Depot and Lowe’s, the nation’s largest home improvement retailers, both instituted emergency plans at midweek. Home Depot activated its Cobb County, GA-based disaster command center on Wednesday, FoxBusiness reports. The effort consolidates supply chain, merchandising and human resources operations on the same floor, Home Depot spokesman Stephen Holmes explained, noting that staffers are working around the clock to move inventory into areas in Matthew’s path.

Home improvement retailers aren’t the only merchants taking steps to minimize Matthew’s impact. CVS Pharmacy is moving generators into target areas and stocking stores with emergency items like bottled water, batteries, flashlights and first aid supplies. Patients in affected areas who have signed up for CVS’s automated notification programs may receive automated phone calls, text messages and mobile app notifications regarding their current prescriptions, the drugstore retailer said in a statement. The alerts are designed to let patients know when their prescription is ready to be picked up, remind them when a prescription is ready for refill and inform them where they can pick up medication during emergency situations.

Rival Walgreens urged consumers to follow evacuation orders and refill medications after first reaching a safe location: “This allows you to avoid potentially long lines at your local pharmacy, and you won’t need to needlessly delay your evacuation,” the company explained in a statement. Walgreens also recommended that customers take with them a waterproof bag containing their current medication (even if the bottle is empty) to help pharmacy staffers more quickly fulfill requests, and to keep a written record of current prescriptions with other valuable papers and files. Walgreens added that some locations may temporarily close due to the hurricane, but pledged to reopen those stores as quickly as possible.  [Source: Retail Dive]

DA Files Charges against 16 Defendants in Alleged Retail Theft Ring

San Francisco prosecutors announced on Monday that charges have been filed against 16 people in connection with an organized retail theft operation linked to burglaries and robberies in more than half a dozen U.S. cities.

The 16 defendants, who face charges including robbery, grand theft, commercial burglary and conspiracy, are linked to dozens of thefts in Union Square and other parts of San Francisco dating back to April 2015 worth more than $225,000, District Attorney George Gascon said.
Local authorities are also providing information to help prosecute another 10 people allegedly connected with the ring for crimes in San Jose, Houston, Dallas, Honolulu, Seattle and Los Angeles, Gascon said.

Prosecutors allege the defendants all took part in a series of thefts that have evolved from simple snatch-and-grab operations — in which a large group would enter a store and take as much as they could before fleeing — to more violent store takeover-style robberies involving the use of pepper spray or knives.

Many of the crimes have targeted retailers in the Union Square area, but other parts of The City have not been immune. Prosecutors said members of the group have also traveled around the country conducting similar raids in other cities as well. Police last year referred to suspects in similar crimes as the “Rainbow Girls” or “Rainbow Crew,” due to the rainbow-colored outfits and hairstyles of some of the participating women. Officials at that time said the group, or perhaps several groups, had been operating in the city for several years. [Source: San Francisco Examiner]

Notorious Train Robber Locked up for Second Time

The ringleader of a two-decades long cargo theft network in New Jersey, is behind bars again after being sentenced to eight years in prison.  Edward Mongon, 41, of North Bergen, is the ring leader of the notorious freight train robbery gang known as the “Conrail Boyz”, which had been operating on and off for more than two decades. He had previously been convicted as ring leader in 2004 and spent four years in prison. 

The Conrail Boyz, described by the state Division of Criminal Justice as an “extensive, well-coordinated criminal cartel”, would study train schedules and review staff practices, security and access points on the CSX and Norfolk Southern rail lines so as to target shipping containers. They would use night-vision goggles and two-way radios to coordinate the thefts. The gang stole millions of dollars worth of valuable merchandise, from high-end clothing and watches to electronics and liquor, after using bolt cutters to open the containers, sometimes while the trains were still moving. They then distributed the goods for sale to local vendors.

The new prison sentence comes after authorities tracked the gang and the distribution of goods for nearly four months before arresting Mongon and nine others in December 2014. His charges included: leader of a cargo theft network – of which he pleaded guilt to – burglary, cargo theft, theft and fencing. He has been sentenced to eight years in prison, including four years without parole eligibility. 

Commenting on the charges before sentencing, Judge Mitzy Galis-Menendez said: “Mr Mongon, there’s no doubt: You’re a thief. You’ve been doing it your whole life. If nobody’s ever told you, Mr Mongon, let me tell you: you’re not good at it.”

Mongon was previously convicted in 2004 on the similar charge of running the cargo theft network since 1992, in which time it had stolen more than $5m worth of merchandise from trains. Twenty-four people were convicted as gang members and Mongon was sentenced to 13 years in prison. He was released on parole in 2008.   [Source: Securing Industry]

Retail Sales Expected to be Vibrant This Year

With the big shopping season just getting started, one of the most closely watched forecasts for holiday sales is predicting a merry time ahead for traditional retailers — and an even merrier one for online sellers. The National Retail Federation predicted Tuesday that sales will tick up 3.6% overall in November and December to $655.8 billion. That would make it far better than the 2.5% average growth over the 10-year period, or even the 3.4% average in the last seven years as the nation emerged from recession. The forecast focuses on retail sales, excluding spending on cars, gasoline and restaurants.

The bigger gainers would be online sellers. Non-store sales are going to increase from 7% to 10%, the NRF forecasts, to $117 billion. “All of the fundamentals are in a good place, giving strength to consumers and leading us to believe that this will be a very positive holiday season,” NRF CEO Matthew Shay said in a statement. “Our forecast reflects the very realistic steady momentum of the economy and industry expectations.” Other shopping outlooks are also rosy, predicting double-digit online sales growth.  [Source: USA Today]

LP Worldwide: Police to Crack Down on Shoplifting at Supermarket Self-Service Checkouts

New South Wales Australia Police will be cracking down on supermarket security at self-service checkouts, saying plain-clothes officers will be watching customers. Detective Superintendent Murray Chapman said officers will be running a number of covert operations involving closed circuit camera filming, local police and loss prevention officers in plain clothes.

He reminded people that committing this kind of offence is a crime, no matter how small people think it is.”Even if it is the avocado and you think you’re saving $2, it’s still shoplifting,” Superintendent Chapman said. “It’s still stealing, it’s still a crime and if we catch you, or you get caught, you will be charged.” Police would not comment on the ways in which people were stealing, whether they were not scanning items or scanning them as something of a lesser value. [Source: ABC News AU]

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