Shoplifters cost Fremont hardware store $700K amid Bay Area spike

VIDEO: Surveillance footage from Fremont-based Dale Hardware captures employee confrontations, suspects waddling away with stuffed pants

Some shoplifters at Dale Hardware are sneaky, slipping tools into their pockets. Others are brazen, like the ones who pushed a shopping cart full of merchandise right out the front door.

“You’ll go, ‘Sir, sir, sir!’ and they don’t even turn around,” owner Kyle Smith said. “Or they’ll give you a look, like, ‘Do you want to go there?’”

Last year, shoplifting cost the Fremont store $700,000, said Smith, whose grandfather founded the shop in 1955, when the area was still called Centerville. He would “roll in his grave” if he knew the financial toll that shoplifting was taking on the family business, Smith said.

Experts cite a unique set of circumstances that contribute to today’s shoplifting problem: accelerating organized retail theft, social media posts that facilitate mob-ransacking, increased homelessness, widespread drug addiction, and a societal move away from incarceration for less-serious crimes.

A survey of large U.S. retailers by loss-control consultancy Hayes International showed the average shoplifting take jumped to $802 last year, 26% higher than 2021. The National Retail Federation’s most-recent estimate pegged “retail shrink,” primarily driven by shoplifting and theft by organized criminal groups, at $95 billion in 2021.

Business owners across the Bay Area say shoplifting is escalating, and because so many incidents go unreported, official statistics fail to capture its magnitude.

Even so, reports of shoplifting crimes last year hit their highest numbers since 2013 in Alameda, San Mateo and San Francisco counties, according to data from the California Department of Justice.

In Santa Clara and Contra Costa counties, reported incidents were below decade highs but swung upward — sharply in Santa Clara County last year — after dropping in 2020 amid COVID pandemic shutdowns.

Sam Kalil, owner of two San Jose shops, Jeans Palace and San Jose Blue Jeans, said it’s difficult to hold shoplifters responsible and many steal with impunity.

“I stopped calling police. Shoplifting, they don’t even bother to show up anymore,” Kalil said.

Kalil, in business for nearly 30 years, said he loses $1,000 to $3,000 a month to thieves at each store. He has seen a surge in shoplifting since the pandemic, over the past two years, he said. Last week, a man snatched a pair of sweatpants and when Kalil tried to stop him outside, he found himself looking into the barrel of the thief’s gun. “Luckily, he didn’t shoot,” Kalil said.

Shoplifters at Dale Hardware sometimes stuff items down their pants, like the man who trousered 37 circular saw blades. Sometimes they “borrow” the store’s own tools, like the man who grabbed an extendable duster to retrieve items stored 12 feet up for security, Smith said. One burly pair exited the store with a flatbed cart loaded with $11,000 in specialty wire, an accomplice at the doors posing as a customer warning employees to stop pursuing because “those guys have guns,” Smith said.

Dale Hardware usually only calls police when a loss exceeds $10,000 because perpetrators are unlikely to be held accountable over lower-level amounts, Smith said.

Adding another $4,000 to Dale’s recent losses was a well-dressed woman who left the store pushing a double stroller draped in a blanket decorated with teddy bears. In-store video showed she had stripped bare the store’s 12-foot wall of batteries in less than four minutes, putting her bounty where babies should have been.

News reports often focus on brazen thefts driven by organized retail-theft groups at chains such as Walgreens and Sephora. But, “for every large national brand you see hit there’s probably four or five smaller retailers getting hit at the same time,” said California Retailers Association president Rachel Michelin.

Pilfering of items big and small has become an existential threat for Dale Hardware, Smith said. “How do we run a small business with $1,800 of loss every day?” he said. “It ends up costing the consumer more money because we can’t survive without raising prices.”

At the high-end Joseph George wine shop in San Jose’s Willow Glen neighborhood, shoplifting only happens about once a month. Still, it’s costly just the same, said owner Bert George. He could run the place himself, he said, but needs two additional employees to deter thieves. A couple weeks ago, he said, a man with a knife sticking out of his pocket was fondling a $300 cabernet and casting shifty glances at him. “I’m thinking, ‘What’s going to happen here?’” George said. The man left abruptly when asked if he needed help and got into a car that immediately sped away. The incident, given the knife, left George unsettled. “It’s really a scary, emotional thing,” he said.

About half Dale Hardware’s losses come from those who “needed something and didn’t want to pay,” Smith said. Sockets, screwdrivers, a hole-puncher for irrigation lines: Theft of such items is constant at the 102,000-square-foot store, despite dozens of employees, cameras, and license-plate readers in the parking lot. When questioned, thieves often say they thought insurance would cover the loss, but most retailers’ policies do not, Smith said.

Smith chalks up the rest of the shoplifting to professional and habitual thieves: criminals stealing tools of their trades, like angle-grinders for cutting bike locks and reciprocating saws for catalytic converters; homeless people carrying off flashlights and charging cables; and organized criminal groups boosting items for resale.

One 26-year-old woman Smith questioned showed a list of specific items she has been tasked with stealing by a man in Oakland who sent a dozen thieves out daily around the Bay Area, Smith said. “She had already been to Target,” he said. “She’d been to Home Depot. She’d been to Lowe’s.”

Many shoplifters steal to meet the “specific demands” of stolen-goods vendors, according to the California Highway Patrol’s Organized Retail Crime Task Force, a multijurisdictional group set up in late 2019.

Top targets for organized retail thieves include designer clothes and sunglasses, phones, allergy pills, vacuums, shoes, handbags, beauty products, office supplies, printer cartridges, meat, booze and infant formula, according to the National Retail Federation.

Karl Langhorst, an adjunct professor at the University of Cincinnati School of Criminal Justice, described a chain of finger-pointing that starts with retailers blaming police for not investigating shoplifting, police complaining that district attorneys will not prosecute, and DA’s offices pointing at judges for setting many shoplifters free.