Walgreens anti-shoplifting strategy backfired, CEO says
Published: 16:43 15 Jan 2025 GMT
Walgreens Boots Alliance Inc (NASDAQ:WBA, ETR:W8A) CEO Tim Wentworth has revealed the pharmacy and retail chain’s anti-shoplifting measures have backfired, negatively impacting sales.
During the company’s recent earnings call, he likened the challenge of addressing theft to “hand-to-hand combat.”
He said while increasing security measures, such as locking up products, may seem like a straightforward solution to shoplifting, these actions can inadvertently reduce sales.
"When you lock things up, for example, you don't sell as many of them," Wentworth said. “We’ve kind of proven that pretty conclusively.”
The CEO said the company’s asset protection team is taking “creative “ steps to address theft while avoiding negative customer experiences.
The company experienced a 52% rise in shrink - a term referring to the loss of inventory due to theft or other factors - in 2021, prompting investments in security. This improved shrink from 3.5% of sales in 2022 to approximately 2.5% to 2.6% of sales in 2023.
