USA update

Home Depot testing technology to combat organised retail theft

Outfit is a startup that sells "DIY home renovations in a box". It formats architect-designed templates to a customer's space and buys all the materials needed on their behalf, and ships it to their door for them to build. The experience is accompanied by an app that guides users from start-to-completion of the project.

Home improvement giant, The Home Depot is trying a different approach when it comes to curbing what it believes has become a growing problem with crime within its stores.

The crime typically involves an individual or team walking into a store, grabbing a stack of power tools, and then heading to the front of the store. Next, they either ring up a few smaller items in the self-checkout lane to mask the crime or simply walk straight out the door.

Either way, the tools are never paid for, and the individual or team will repeat the crime at the same store or various locations.

To combat such organised retail theft some power tools at Home Depot are kept on locked shelves, some are wrapped with security devices around the boxes, and security cameras keep watch on the aisles. But those tactics haven't stopped organised theft. Scott Glenn, Home Depot's vice president of asset protection, told local TV station, 11Alive:

We are working on a very strong strategy to, what we like to refer to as harden the target against these types of folks.

An evolving anti-theft strategy the big box retailer is now using involves a chip being inserted into power tools from DeWalt and Milwaukee brand tools.

Similar to how gift cards need to be scanned and paid for at a store to activate, the power tools need to be paid for, and then - using Bluetooth technology - the tool is activated. Tools that haven't been activated won't turn on, according to The Home Depot.

The technology is currently part of a pilot program in select stores in Atlanta, Georgia and in other Home Depot markets. The goal is to discourage thieves, while keeping employees and customers safe and keeping costs low, according to Mr Glenn. He said:

Theft and fraud are a pressure to those cost concerns, and we want to make sure we don't have to do anything to affect that pricing for our customers.

Mr Glenn added that often power tools stolen from The Home Depot end up in a few different places. For example, pawn shops and online marketplaces, from eBay to Craigslist, Facebook Marketplace, and a growing list of others. He said:

Ten, fifteen years ago, there were really one or two online resellers out there, and now we can think of 50. It is a fast, easy way to dispose of a stolen product.

Mr Glenn said if the technology proves successful during testing in select power tools, it could eventually be inserted into other products with an on and off switch. He said:

We want to lead in this space. We want to make sure the technology is not only where we want to be today, but where we are going in the future.

A recent survey conducted by US-based National Retail Federation found in 2020, organised retail crime increased significantly for 31% of retailers surveyed. Forty-four per cent reported a slight increase, 2% reported a decrease and the remainder reported no change compared to 2019.

Currently, lawmakers in Washington DC are considering legislation to target high-volume sellers of stolen retail items. The INFORM Consumers Act introduced in March 2021 in the US Senate aims to "prevent organised retail crime rings from stealing items from stores to resell those items in bulk online".

It describes "high-volume" sellers as people who make more than 200 sales or have more than USD5,000 in revenue during a 12-month period on a marketplace. The act would require such sellers to supply the marketplace with bank account information, government-issued identification, a working email address and phone number, along with a business tax identification number.

Home reno startup

US-based startup, Outfit wants to make DIY home improvements easier to tackle. Founder and CEO, Ian Janicki, said he has always wanted to make architecture and design more accessible to people. He told TechCrunch:

I realised I could leverage my knowledge of being handy to create a product that scaled.

For people who want to go through the Outfit process, the first step is submitting information about the space they're looking to renovate, such as dimensions and photos, as well as the maximum amount they're looking to spend. Outfit then provides information about the expected cost of the project, the handiness level required to complete the project and everything that would need to be done in order to complete the project. Mr Janicki said:

We make sure it's transparent and that you understand the amount of time that might be required.

Once someone decides they want to move forward, Outfit then sends all the necessary tools and materials to the customer. Through the app, Outfit offers a step-by-step guide for completing the project. In the event someone gets stuck, they can chat with Janicki or someone else from the Outfit team for support.

Outfit has had a small set of pilot customers - some who have completed their projects and some whose projects are still underway. Mr Janicki said:

The millennial generation is now starting to purchase their homes and has been accelerated because of remote work and COVID. They're the Ikea generation and can put together bookshelves and are really used to digital experiences and are now demanding this digital solution.

So far, the projects have ranged in cost from USD1,000 to USD15,000, but it depends on things like how invasive the project is, how big the space is and more, Mr Janicki said. In general, Outfit charges customers the cost of the actual materials (for eg. power drills, wrenches, cabinets, tiles, etc.) and then adds a percentage of the total on top as a surcharge to the customer.

Down the road, Outfit envisions offering rentals of the tools themselves, but Mr Janicki said he just wanted to streamline everything in the early days.

Reverse logistics is complicated to we're trying to take it one step at a time.

There are a number of home improvement startups out there such as Eano, Renno and others, but Mr Janicki said he's not aware of any direct competitors. He said he recognises that there are some people who are fully capable of buying all the necessary items themselves, watching a video on YouTube and then completing the project.

Meanwhile, homeowners are also just as capable of hiring someone to do the project for them. But with Outfit, Mr Janicki sees it as somewhere in between. He calls it "DIY plus".

In terms of being handy, it's a rare trait that everyone appreciates. If we can elevate people in their handiness level, I'm going to be super happy. It's that pride that you were actually able to accomplish that.

To date, the company has backing from Y Combinator, and previously raised about USD700,000 from investors like GitHub CEO Nat Friedman, B Capital Group's Crissy Costa, Gumroad CEO Sahil Lavingia and others.

  • Sources: WXIA-TV (11Alive), Yahoo News and TechCrunch
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