Old Navy and Lululemon Latest Victims of Retail Crime Free-for-all

Old Navy has joined the likes of Nordstrom, Anthropologie and Saks Off 5th as fashion retailers pulling out of downtown San Francisco.

The announcement that the 72,000 square-foot store would not be renewing its lease on July 1 came as the location reportedly was hit with 22 shoplifting episodes in two days.

More from Sourcing Journal

• Air Demand 'Challenging to Read,' but Lower Prices Were Good News for Gap, A&F

• NYC Mayor Unveils Retail Theft Plan as Store Owners Abandon Big City Centers

• Major Indian Group Can Resume Organic Cotton Certification

“Since our Market Street store opened in the 1990s, the way we leverage flagship locations has changed,” Gap Inc., the parent company of Old Navy, said in a statement. “We are already working to identify new locations in downtown San Francisco that will better serve the needs of the business and our customers.”

Gap Inc., which also includes The Gap, Banana Republic and Athleta, cites changes in market conditions unrelated to shoplifting. Those factors include a 30 percent vacancy rate in commercial real estate in downtown San Francisco that was just 4 percent pre-Covid plus the rise in homeless encampments scaring some shoppers away from downtown.

In a statement responding to the Old Navy closing, Gap Inc. affirmed its commitment to downtown San Francisco by noting plans to erect a flagship Banana Republic store on Union Square’s Geary Street.

“Gap Inc. has deep roots in San Francisco and is committed to the city,” the Bay Area-based apparel retail chain said in a statement. “We recently invested in renovating our Downtown San Francisco hub where our teams come together to develop new consumer experiences and product innovations.”

That global hub, which opened last June, unites all four Gap Inc. brands in a “laboratory” concept, which includes a coffee bar and “Co-Lab” maker studio where visitors can watch the fashion design process come together.

In its statement, Gap pointed customers to its remaining Old Navy stores in the Bay Area, including Daly City, Colma and Emeryville.

A CBS San Francisco affiliate report quoted an anonymous Old Navy Market Street store worker who said the store was typically hit by shoplifters 12 to 14 times per day, and that in the two days leading up to the announcement of the closing, it was victimized 22 times by shoplifters.

Store employees who want to intervene during shoplifting incidents are increasingly finding the company line to be to avoid confrontation with problematic customers at all costs.

A pair of Atlanta-area Lululemon employees found that out the hard way on April 24 when a store worker recorded three thieves stealing merchandise and 911 was called after the suspects fled.

Earlier this month, Rachel Rogers and store manager Jennifer Ferguson were fired, reportedly without severance, for failing to adhere to company policy, according to the yoga pant retailer.

In an email sent to Sourcing Journal, Lululemon said the workers were not fired for calling 911—as the terminated employees contend—but rather for “knowingly violating our zero-tolerance policy related to physically engaging with the perpetrators which put their lives and the safety of our guests and other employees at risk.”

“We are grateful no one was hurt during this altercation,” the company said in a statement. “At Lululemon, our people’s safety is our number one priority, which includes an absolute zero-tolerance policy for our employees engaging with guests in a way that could put themselves, or others, in harm’s way. We have longstanding protocols in place to uphold a safe environment in our stores, and our view is that no amount of merchandise in a store is worth our educators putting themselves at risk.”

A one-page graphic in the Lululemon employee handbook instructing workers on “navigating theft.” Workers are directed to never: “Be a hero,” “Accuse anyone,” “Leave the store,” or “Endure threats,” and to always: “Keep a safe distance away,” “Clear a path for thieves to flee,” and “Call 911 for weapons, assaults or threats.”

The Lululemon document instructs employees to avoid the term “shoplifter” altogether, and to not film or take photos of any episode.

In the video taken by Rogers, Ferguson can be heard yelling “no,” repeatedly and barking at the thieves to “get out,” but neither contacts the suspects nor impedes their progress.

One of the perpetrators on the video can be heard saying “Chill, b—-, shut your a– up.”

The three suspects—Quintavious Gooch, 19, Braylon Shivers, 20, and Bayo Allen, 19—were arrested the next day after they were caught allegedly trying to shoplift from another local Lululemon store, according to the Fayette County Sheriff’s Office.

Lululemon was also in the news earlier this month for a different type of retail theft. On May 16, authorities from the Sarasota County Sheriff’s Office arrested 55-year-old Bradenton, Fla. realtor Mark Tilley for allegedly defrauding the company of $200,000 during a 12-month returns scheme. According to the department’s Economic Crimes Unit (ECU), Tilley would order products from the Lululemon website using credit cards in different names and have them sent to various addresses within his apartment complex. Police say he would then send back empty boxes to get an e-gift card and would allegedly return items to brick-and-mortar Lululemon locations to earn even more credits.

According to the police report, sheriffs were informed of the suspicious activity by Lululemon’s organized retail crime investigations unit on April 17. The police report says that not only was Tilley able to use an electronic device that allowed him to get credit cards in multiple names, he made the transactions with the same phone number, which helped him circumvent the company’s fraud detection system.

Lululemon investigators told police they observed Tilley picking up packages sent to his apartment’s clubhouse and taking them back to his apartment or garage.

In a Facebook post, the sheriffs’ office said the investigation was a “painstaking,” multi-state effort from the ECU, which was formed in October 2021 to fight fraud and scams.

“ORC is a complex issue which requires detailed investigative experience and time investment to uncover,” sheriffs said in the post. “This type of crime causes retail prices to increase which sooner or later fall on the consumer.”

Tilley was arrested on a charge of grand theft larceny exceeding $100,000 and was released on May 18 on $50,000 bond.

Lululemon estimates it lost $126,000 between October 2022 and April 17.

Click here to read the full article.