Supply Chain Theft: Fashion Logistics Fights Back

The International Business Times dug up an interesting (and, well, all sorts of sad) story illuminating the persistent problem of supply chain theft. In California recently, thieves stole 1,600 pounds of dog food — worth an astounding $10,000 — from a truck en route to a pet rescue shelter.

According to the story, this type of (sometimes seemingly senseless) theft is more common than you might think:

The National Retail Federation's latest spring survey shows that more than nine out of 10 respondents say they have been a victim of organized retail crime in the previous 12 months, a 6 percent increase from the previous survey done in the spring of 2011. Sixty percent of respondents say they've noticed an increase in such criminal activity in the same period of time.

[…] Organized retail criminals tend to target electronics, apparel, pharmaceuticals, cigarettes and prepared food products, according to New Jersey-based CargoNet, which tracks incidences of cargo theft that is reported to it. CargoNet says electronics made up 47 percent of goods nabbed from the logistics chain, while 75 percent comprised electronics, food, apparel, beauty products and pharmaceuticals.

(Photo: International Business Times)
CargoNet, which tracks logistics-chain theft, says 81 percent of lifted containers it tracked last year occurred in the top five states on its list. These have in common a high number of cargo-transit terminals.

Some aspects of modern commerce have made theft easier and more lucrative as well, including the ease of re-selling stolen goods online at sites like eBay or Craigslist. But it's not just that there are more criminals out there or that criminals are getting smarter. According to the study, several aspects of the modern retail environment—from one end of the supply chain to the other—are also to blame for the rise by making such theft just a little bit easier.

For example, as more and more commerce shifts online, brick-and-mortar stores are cutting back on staff sizes. Fewer employees equals greater opportunities for theft.

Another big chunk of the losses come before the goods make it to stores, primarily from warehouses (don't skimp on professional apparel warehousing services), truck stops or terminal lots — often over weekends. Organized crime elements with the capabilities to quickly turn around an entire truck or shipping container full of apparel or electronics will often target these links in the chain.

Supply chain theft doesn't only happen to the parts dealing with finished products, however. Raw materials can also be enormously lucrative. The FBI estimates that $30 billion worth of goods are lost each year, including raw materials.

This is especially difficult to prevent in the modern, highly integrated world we live in today. Supply chains are expanding farther and farther, with more and more unique countries serving as links in the chain. Do fashion logistics right — backed by expert, cutting-edge apparel supply chain management — and you'll reap vast savings that you can then pass onto your consumers, your employees, and your shareholders. Do it wrong, however, and you'll quickly see why each link has a unique set of vulnerabilities to delays, inefficiencies, and outright theft and loss.

Posted: 7/25/2012 2:07:53 PM by Global Administrator | with 0 comments

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