Organized crime used to be the stuff made for movies: drug trafficking, money laundering, trafficking firearms and smuggling goods.
Now, it’s a growing problem with basic, daily needs. Shoppers might be surprised to see more items locked down at stores or limited quantities available for items including laundry detergent, energy drinks, medicine and fresh meat.
Organized Retail Crime, or ORC, has been on the rise since the height of the pandemic. In 2021, a National Retail Security Survey reported that ORC was up more than 26 percent, equating to nearly $100 billion in losses.
Businesses are left brainstorming ways to keep their goods secure, employees safe and customers satisfied.
J.P. Frattone, director of asset protection and safety at The GIANT Company, said their stores experienced an increase in shoplifting and ORC since the pandemic. These issues are impacting a wider geographical area, Frattone said, with ORC offenders traveling across states and hitting multiple stores in the same market.
“Offenders are taking larger amounts each time,” he said. “At times, we are seeing the criminals become aggressive in the ways which they take goods and toward team members and customers. The same criminals are hitting multiple stores within the same area once they are in a particular market. In the past we would not see traveling crews of ORC activity in the suburbs, but now the crews are impacting those areas.”
Retailers expect a certain amount of shrink each year, but ORC is more than small theft. It carries with it different characteristics. Dawn Roller, director of loss prevention for Brown’s Shoprite Superstores, said offenders are bolder and more brazen. They disguise themselves to avoid facial recognition and can be armed. Frattone said thankfully their stores have not experienced violent behavior, but other retailers have seen increased aggression toward employees and customers.
“The bad actors are becoming bolder in their behavior,” he said.
So what changed? Roller surmises that many existing factors have bubbled to the top since the pandemic: the news cycle, poverty and education issues. Frattone adds that inflation, fewer law enforcement resources, prosecution thresholds and bail reform are impacting higher rates of crime.
The ways that criminals can pawn stolen items also has changed, making ORC easier. “Online marketplaces have been a growing channel as an outlet for retail theft,” he said. “Typically, we would see pawn shops and corner stores as an outlet; however, online marketplaces have grown as an outlet for retail theft.”
Lisa Dell’Alba, president and CEO of Square One Markets, Inc., and PFMA Board president, said a change or increase in in-store theft is less of a problem for their locations. They still experience petty theft and issues with health and beauty products or items like Advil and Tylenol.
For years, they were combating skimming. “What we see now is not an increase but a shift,” she said. “That shift has gone to people breaking sensors and trying to steal fuel again.”
At Square One locations, more people are attempting to steal and syphon gas. “We’re kind of back to some of the old school stuff, in a way,” Dell’Alba said.
Employees also have been targeted by gift card scammers. People have called store locations claiming to be Dell’Alba, asking the cashier to purchase $1,000 in gift cards and call back with the card numbers. These scammers are taking advantage of employees who typically work quiet, overnight shifts and don’t know Dell’Alba, the owner, well.
In grocery stores, ORC is targeting a wide variety of everyday items. Roller said laundry detergent, health and beauty products, fresh meat, seafood and baby formula are popular items. Frattone said their stores experience similar losses, noting that targeted items don’t vary by store location. A recent Business Insider article listed thieves most-wanted items, ranging from appliances to razors to housewares to pet medication.
And theft is one issue, but the effects of ORC are much broader.
“Certainly, this is an impact to everyone who shops and works in our stores. Beyond the potential impact to safety, ORC can also impact pricing, the availability of goods for our customers and the experience they have in stores,” Frattone said.
Retailers are now tasked with implementing new strategies and technology to combat ORC. Some stores are locking up popular items or putting fewer products on shelves. Others are holding special training for team members. Most have had to invest in new security and technology.
Roller trains her team to be observant and use good customer service. “Customer service is key. If you walk up to someone and ask, ‘Are you finding everything you’re looking for,’ they do not want to be identified. They will leave fast.”
But, she is quick to note, “Don’t be a hero.” Dell’Alba feels the same way. Report what you see, but stay safe. “I can replace a Snickers. I can’t replace a team member,” she said.
On the more technical side, Frattone said GIANT locations have implemented new technology that does not impact customers’ shopping experiences, but helps to keep team members safe. “We also implemented third-party security guards, police officers, anti-theft fixtures and mobile parking lot cameras in select locations,” he said.
In addition to increased training, Roller said their stores have implemented new cart technology and self-checkout intelligence that help to resolve ORC problems at checkout. Roller and Frattone also provide their teams with de-escalation training and resources.
Another beneficial tool is collaborating with other retailers and working through PFMA, said Roller and Dell’Alba. Building relationships and sharing information play a major role in combating ORC. Frattone added, “We can leverage resources and bring cases together, versus acting as singular entities. This will allow for a more successful outcome on taking down large criminal enterprises.”
Illicit trade and organized retail crime remain PFMA priorities. The association supports federal work on this issue and is encouraging Congress to pass the Inform Act, which aims to address the national issue of reselling illegally obtained goods online. PFMA also is working at the state and local levels on a multi-pronged approach to combatting the problem: strengthening partnerships between retail and law enforcement agencies and helping facilitate open lines of communication to ensure criminal activity is prosecuted in an intelligent and systematic fashion, and also pushing for policy reforms where gaps or deficiencies in current retail theft laws exist.
To assist with PFMA’s efforts, or to get involved in the association’s Loss Prevention Committee, email email@example.com.
Make no bones about it, Kolby and Kaleb Rush were onto something when they cooked up a unique plan for a pandemic project.
The brothers from Bucks County were in college when COVID-19 hit, sending them home to learn remotely. Both had secured internships, but the pandemic derailed their goals. So, they set new goals.
“We got sent home from both of our respective campuses,” Kolby said.
"We thought we should probably start doing something because we lost internship opportunities. …We thought starting a business—as small as it might be—would be an awesome resume line.”
That thought has grown into much more than a line on a resume. Today, Kolby and Kaleb Rush co-own Saint Rocco’s Treats, a Perkasie-based, small batch, craft dog treat company. But it didn’t happen overnight.
Kolby and Kaleb chose to focus on familiar territory. At the time, Kaleb had his sights set on a business degree at Temple, eventually settling with an entrepreneurship major and marketing minor. Kolby was in his senior year at Penn State focused on finance. They also had some industry insight.
“We were really fortunate because we’ve grown up, through our dad and grandpa, in the dog treat industry. We worked for our dad directly for a number of years, so we roughly knew how to make up dog treats,” Kolby said. “We knew about the backend of the industry, and we saw there really are no local companies making high-quality, meat-based dog treats.”
From there, the duo worked alongside their dad to craft recipes. (Cooper, the family’s Cavapoo, eagerly agreed to taste test.) Then it was full speed ahead with logo design, social media, website development, door-to-door samples and more.
Kolby and Kaleb were confident in the product. From their research and experience, they knew their treats filled an unmet need. They focused on fresh, locally produced, human-quality dog treats. “We really saw the issues within the system. Ultimately, that knowledge led us to what Saint Rocco’s is today and how we differentiate ourselves,” Kaleb said.
The big hurdle was getting others to see and taste the difference in the midst of a pandemic. They cranked out small batches of treats in their family kitchen, then started their masked, door-to-door tour of the neighborhood. As dog owners and lovers, they knew they had to win their neighbors’ hearts and minds.
“To create something, people have to be aware of it,” Kaleb said. “From there, we went to thousands of homes in our neighborhood, delivering free samples and introducing ourselves.”
Once a furry friend tried the product, the Rushes got nothing but rave reviews. They quickly outgrew their home kitchen operation, relocating to a family member’s barn with a kitchen. What started with a small, countertop meat grinder expanded into a commercial kitchen.
Now about two years into their business, Saint Rocco’s Treats can be found in more than 130 independent retailers. Kolby and Kaleb are gaining plenty of fans by attending local events where they can interact with pet parents and their pups. In October, they hosted a grand opening at their store, providing tours of the facilities, offering dog photographs and partnering with a local brewery for refreshments.
As new PFMA members, they look forward to connecting with retailers, learning more about distribution and creating greater awareness of their products and brand.
Kolby and Kaleb attribute their success to like-minded customers. “Our mission is to provide the best quality and service for our fury friends and what they deserve,” Kaleb said. “Those like-minded consumers really want to be better for their furry friends.”
“It’s really cool. This isn’t anything out of the ordinary. We’re just doing it the way it should have been done,” he said.
Crafting the Saint Rocco’s story
It’s been nearly four months since a shooting at a Tops Friendly Market in Buffalo, N.Y., became the latest high-profile, gun-related incident in a grocery store, killing 10 people and injuring others.
It’s hard to miss the headlines—edible oil production and pricing is headed down a slippery slope. Droughts, low production, the Russian/Ukrainian war, rising prices, increased demand for biofuel usage and other complications are making a major impact on edible oils.
Jason Thomas (right), CEO of Healthy Brand Oil Corporation, recognizes the numerous challenges today. Fortunately, the new PFMA member is educating customers and helping to mitigate rising costs.
Thomas looks at what has affected the industry during two distinct timelines.
“I look at it as the 2014 to 2020 period, where crops around the world had good production, demand was pretty stable, pricing was very stable, availability was very stable,” he said. “Then I look at it from 2020 forward—the world just got thrown completely on its head in every way, shape and form.”
Thomas has been in the business since 2004. About 75 percent of their products go through food service distribution, for example restaurants or a retail setting. Approximately 25 percent of the business serves food manufacturers.
Healthy Brand Oils offer a wide variety of oils and quantities, ranging from soy, canola, sunflower, peanut, olive, avocado oils and more, plus non-GMO, organic and expeller pressed options. Oils are packaged in four sizes, ranging from one-gallon containers to 2,500-pound quantities that serve large manufacturers.
If the variety and options seem overwhelming, the website offers an Oils 101 guide. Plus, the Healthy Brand Oils team is available to walk customers through which oil makes the most sense for each use.
“There are some differences that make each product good for certain uses, maybe not for others. We talk about what you’re trying to accomplish and use the product for,” he said. “Maybe a certain oil brings a certain flavor profile, or maybe if you’re using it in a fryer—some oils will last two and three times the fry time of something that looks exactly the same.”
As different global factors impact different oils, it’s important to know where oils originate, Thomas said. For example, the U.S. provides mostly soy; Canada provides canola; olive oils originate in the Mediterranean; and grape, avocado and peanut oils largely come from Europe.
“Last year, we saw a 30 percent crop failure in the Canadian canola crop. In 2021, there was a 30 percent crop failure in the Brazilian corn crop, and this year, there is a 20 percent crop failure in the Brazilian soybean crop,” Thomas said. “These are major needle movers from the world’s largest producers.”
When crops are low or products are inaccessible, such as sunflower oil in Ukraine, customers might need to switch to another product. Despite the fact that sunflower oil is not one of the most frequently consumed oils in the U.S., countries that do rely on exports from Ukraine are now paying a premium for oils that are typically used in the states.
Another major factor impacting availability is a greater national need for biodegradable biodiesel fuel. Food-grade soybean oil is a more environmentally friendly fuel option, Thomas said, and “what a sizeable producer like ourselves can consume in a year, (biodiesel producers) are consuming it in a month.”
So now what? “We’re entering this time period that is more volatile and harder to navigate,” Thomas said. He separates the situation into two major risks: price and supply.
When there is a period where prices might double or triple, that impacts the manufacturer’s margins in a major way, he said, particularly regarding food where profit margins are already low. Health Brand Oils developed what they call “profit lock” to help customers manage fluctuating costs.
Lee Colonna (right), sales development and relationships management at Healthy Brand Oils, explains that the profit lock initiative connects them with the customer to assess their needs and goals. “We’re partnering with them to find out what works for them in the best way possible with the products we choose, while managing the expectations of what they need now and in the future.”
“If today’s pricing can ensure a profitable trade for the customer, then it’s a logical time to extend coverage and ensure that. If you don’t do that, the market can take it away,” Thomas added.
Supply risk presents a more challenging solution. Supply involves product issues, logistical issues and the impact of a global supply chain, he said. The company only commits to products for which they have a high level of confidence and know they can deliver.
“We can’t solve all the problems, but we think we can help,” Thomas said. “(The customer) might not have the internal know-how or the resources to deal with this. This is a piece of the puzzle that differentiates our offering.”
Colonna also stressed the importance of association membership. “It’s a resource. You can’t be an expert in all things. Having a resource like (PFMA) and bringing the information to your members is huge.”
Thomas anticipates the summer months to remain volatile. That volatility has a way of creeping into every aspect of a business, he said. With corn, wheat and soybean in nearly everything, he stresses the importance of understanding the current environment.
“We’re happy to do our best to help navigate what’s best for our customers,” Thomas said. “It’s something we’re looking at every day and trying to assess. It’s a complicated puzzle.”
How PFMA members are addressing supply chain & inflation
“We truly believe that we’ve built the foundation of a company that can continue to expand across the U.S. and delight customers from Miami to San Diego to Seattle!”
It was that hard work and collaboration of many generations that led Utz to one of its biggest and most recent accomplishments: a listing on the New York Stock Exchange under the ticker symbol UTZ on August 31, 2020.
Plenty has changed over the course of 100 years, but many aspects of the business remain the same. The company strives to treat its associates well, make high-quality snacks that appeal to generations of fans and listen to its customers and retail partners. Strong family and business values play out through Utz’ contributions and support to the communities it serves.
For instance, in 2017, the Rice and Lissette families launched The Rice Family Foundation to support the education, health and well-being of families in the greater Hanover, Pa., area. “During 2020, the Rice and Lissette families went further by contributing $20 million in Utz stock to the Foundation, which will allow the Foundation to increase its annual giving by five times over prior years,” Blubaugh said. “In 2020, the foundation provided grants to 35 nonprofit organizations that are involved with mental and physical health issues, drug addition, domestic violence, food banks and more.”
Even during the tumultuous 18 months of the COVID-19 pandemic, Utz relied on its ability to stay lean and nimble to adapt to unforeseen challenges. The company’s ability to quickly change gears and leverage its online platform paid off, earning Utz “the fastest growing salty snack company in e-commerce” as measured by IRI during 20201.
As the snack food giant looks to its next century, Chambers said they will continue drawing from what they’ve learned and accomplished. “We truly believe that we’ve built the foundation of a company that can continue to expand across the U.S. and delight customers from Miami to San Diego to Seattle!”
Blubaugh feels Bill and Salie would be proud of the leadership of Dylan Lissette, Utz’s CEO, and the current generation that is leading the company. “We believe that Bill and Salie would be incredibly proud of the Utz culture that has endured, true to what they initially sought to create, and that our associates have been central to the success of the company.”
1 Source: IRI; Measured % dollar sales; 52 weeks ending Dec. 27, 2020; E-Commerce Channel with businesses larger than $100,000.00 dollar sales.
Did you catch Utz on PFMA’s Shelf Confidence podcast? Hear more about the “new normal” of snacking!
So, connect the food to the people.
Logistically, it’s a little trickier. That’s where the Pittsburgh- based nonprofits 412 Food Rescue and Food Rescue Hero swoop in.
“Good food belongs to people, not landfills,” said David Primm, head of partnerships and growth with 412 Food Rescue.
Started in Pittsburgh’s 412 area code about six years ago, this PFMA associate member works to get usable, perishable food items to its community. “We’re preventing perfectly good food from going to waste and redirecting that to people who are food insecure,” Primm said.
The best part—food retailers are in a perfect position to help. “Nearly half of the food that’s wasted is actually wasted at consumer-facing businesses. That’s your members, that’s grocery stores and other retail outlets, it’s restaurants and institutions,” said Jennifer England, senior director of partner success. “We make sure that food gets to people who need it by leveraging our technology to reach out to volunteers so they can take it to where it needs to go.”
412 Food Rescue and Food Rescue Hero make this process easy for their partners, in part, thanks to well-designed technology. Food rescue can be labor intensive without the right tools, England said. With such a highly distributed network, it’s inefficient to schedule truck pickups for small quantity donations at multiple locations. Fortunately, England said the organization’s cofounder has a background in tech startup and created the Food Rescue Hero app. This purpose-driven technology makes it easy to connect food retailers, volunteers and community members in need.
A food recover program using 412 Food Rescue’s technology and operations has no downside. There’s no value to food in the garbage.
That technology allows them to increase their impact. 412 Food Rescue generally covers the 412 Pittsburgh and Allegheny County area code. By using the Food Rescue Hero app, they are able to extend their reach and work with 13 cities in the U.S. and Canada, three of which cover new service areas in Pennsylvania.
The organization also is very agile, working hard to keep the food rescue process simple. Instead of telling partners they have to bend to the schedule of 412 Food Rescue, England said they ask donors what works best for them. “We want to serve our partners whether it’s our food donors, our nonprofit partners or our volunteers. We want to meet our partners where they need us.”
As food insecurity intensified over the course of the pandemic, the nonprofit shifted and evolved its operations. Access to good food became more important than ever. Just as many consumers relied on grocery delivery, 412 Food Rescue and Food Rescue Hero began making home deliveries. This change provided a way to get quality food to the most vulnerable populations.
In its sixth year of operation, Primm said they’ve reached a major milestone. “We just hit that 20-million-pound mark here in our region. That’s through the great effort and support of our food donors and a lot of the PFMA members.”
One PFMA sponsor and member, Giant Eagle, joined 412 Food Rescue as a food donor in 2019. They already have recovered 2 million pounds of food.
Primm and England have heard many myths and misconceptions surrounding food donation. Some businesses think they have no food to donate. Others fear a lawsuit from potentially getting someone sick. And some donors have been burned before from volunteer no-shows. That is where 412 Food Rescue can provide their expertise on everything from food preparation to tracking donation pickups and dropoffs to laws that protect food donors.
Primm said one of the most common misconceptions about food donation is that potential food donors don’t realize how much food they are able to donate. When 412 Food Rescue consults with food retailers, the retailers often are surprised to hear the results.
Recently, when Primm approached a PFMA member about food donation, they explained they had nothing to provide. After speaking with the produce and baking managers, he helped the store identify items that could be donated. Within two weeks, that store donated 3,500 pounds of food, which equates to 3,000 meals. The retailer saved usable food from being wasted, provided nutritious food to those in need and gained financial benefits from the donation through tax incentives.
“There is zero value in wasted food,” Primm said, “but together, working with your members and other food donor partners, we’re able to create this value that impacts the entire community.”
England encourages anyone who remains on the fence about food donation to try it firsthand as a volunteer by downloading the Food Rescue Hero app. “A food recovery program using 412 Food Rescue’s technology and operations has no downside,” England said. “There’s no value to food in the garbage. It’s a win-win-win to donate food."
Pronio’s customers are looking for something special. The store carries freshly cut and ground meats, locally made products, fresh produce and high-quality Italian items. Pronio’s is well known for its homemade meatballs, strombolis and famous sausage. They’ve even started a line of coffees named after their dogs.
The market is for “people who are looking for a quality product, a fair price, and a clean store with family service,” Mike said.
Beyond what’s in the shopping cart, customers know that at Pronio’s, they will be treated like family. Shoppers and employees know each other. Bags always have been taken out to the car at no extra charge. James Pronio, Mike’s oldest son, grew up helping in the store and continues to do so as time allows. “Customers are looking for a personal experience,” he said. “They know the baggers, they know the Meat Department. In essence, you’re being served by family and friends, and your needs feel like they are met.”
An area legacy like Pronio’s comes with a unique history and plenty of stories. Originally from New York, Michele Pronio moved to Hershey when his brother—who snagged a job with Milton Hershey’s band—said the area had new job opportunities. The family first went into business not far from the current Hershey’s Chocolate World, and Mike recalls stories of his grandfather loading up a wooden crate with canned goods to sell door to door.
In the mid-1920s, Pronio’s moved to the opposite corner from where it stands now, which today is a dress shop. Then, the business operated more like a general store with a variety of foods, home goods and more. When the eldest Pronio retired, Mike’s father eventually shifted to the location and store model that exists today.
Mike said his father ordered a train car of grapes each fall, which he’d truck around to local Italian families so they could make wine. That truck was one of few in town. When one of Pronio’s customers once went into labor, Mike said his dad loaned the work truck to the expectant father so he could drive to Harrisburg to be with his wife and child.
I like the idea of knowing who’s coming through these doors. We talk, we tease. People support this store and want to see it strive and survive."
“There is a kinship, a family-friendly mentality here. People know it comes back to that mentality,” James added.
Pronio’s has about 35 employees who measure their time at the store not by years, Mike said, but by decades. They have served generations of families. When the world flipped upside down in 2020, their loyalty enabled the local market to meet demand and provide a safe shopping experience.
“Business was up 30 to 40%, and people were lined up at the door every morning,” Mike said. “A lot of people wanted to come into a smaller store because it felt safer. And we managed because our employees stuck with us.”
As the area continues to grow and larger businesses pop up along the main roads, Mike knows that in reality, Pronio’s shouldn’t exist. Decades ago, the town was known for farm fields, orchards and small businesses. Today, he is one of few small businesses remaining near the main road. But, James said, their size allows Pronio’s to remain small and agile. Their dedicated staff is productive and efficient. And they work hard to meet customer requests.
“We don’t stray from our values,” James said. “We’re not trying to be the trendiest. We offer solid products. It’s about slow, steady, consistent growth and making sure the customers’ and employees’ needs are met.”
Their success, in large part, comes back to these relationships.
“I like the idea of knowing who’s coming through these doors. We talk, we tease. People support this store and want to see it strive and survive,” Mike said.
He cherishes the chance to continue his family’s legacy and hopes to do so for years to come. “The opportunity was there, and this was the chance of a lifetime,” Mike said of taking on the family business. “I’ve been given a gift, an opportunity no one gets.”
Erica Logsdon, director of communications and public relations