For the majority of them, the parking lot was the first clue. When a delivery driver arrives at five in the morning with a pallet of personal care items, he expects to see the typical rolling metal door and a weary manager with a clipboard. Instead, he finds a printed notice taped behind the glass and a chained handle. The previous evening, there was no phone call. Not via email. Not a single one of those ambiguous corporate memos that vendors are trained to decipher. It’s just a long drive back and a locked door.
It has been occurring more frequently than the press releases indicate. Dollar Tree, which has been publicly battling what executives refer to as “elevated shrink” for the past year, recently admitted that the issue cost them roughly 14 cents per share in a single quarter. The company is taking “all the appropriate steps” to mitigate the issue, CFO Jeff Davis told analysts. While this may sound calm enough on a conference call, it sounds very different when you’re a regional snack supplier watching your invoices go unpaid because the store you delivered to last Tuesday is no longer technically in existence.
Speaking with professionals in the field gives me the impression that the retail sector has subtly entered a new stage. The warm-up was in the locked plexiglass cases. It’s the buildings themselves now. One time, a reporter from The San Francisco Standard timed how long it took a Walgreens employee to unlock a car air freshener. In one instance, it took fifteen seconds, while at Target, it took three minutes and twenty seconds for laundry detergent. Sales were killed by those waits. Clients took notice. Additionally, a spreadsheet in a corporate office began to suggest that it would be cleaner to completely close the worst-performing locations rather than play defense aisle by aisle.
Naturally, vendors are not included in that spreadsheet. If they are, they are not a relationship but rather a line item. According to a forum thread I’ve been following, a small distributor in the Midwest told me that he discovered three of his accounts had been closed when his own driver called him from an Ohio parking lot. Not a word. No buyer should send an email. When the 800 number rang, there was no category for “my truck is full and your store is gone.”
It’s difficult to ignore how much of this reflects the current state of retail as a whole. Eighty-one percent of organized crime groups target common consumer goods, such as cosmetics, over-the-counter medications, and boring items without security tags, according to the NRF’s most recent Organized Retail Crime Report. Stores are losing inventory in ways that are not visually appealing to security cameras. As a result, the reaction keeps getting worse. Hardware store vestibules that buzz. mandatory bag checks that make a simple errand take thirty minutes to complete. One customer told the Associated Press quite bluntly that she would buy something somewhere else if it was that difficult.
From the supplier’s perspective, the vendors are coming to the same conclusion. A number of chains that have a history of abruptly closing have begun to demand upfront payment or refuse to increase shelf space. Some have switched to direct-to-consumer business models, which is risky in and of itself. It’s still unclear if any of this truly alters corporate behavior. It doesn’t really matter who was caught off guard by the math that results in an abrupt shutdown—too much shrink, too little foot traffic, a lease that is about to expire.
However, the tiny human texture of it endures. No one told the driver not to come, so he was eating breakfast in his taxi. A customer tells a store manager. the gradual, quiet realization that the relationship was never quite what it appeared to be.
