CHICAGO -- Dominick's Finer Foods stores here relocated powdered infant formula from the grocery shelves to the pharmacy recently to keep tighter control over the item, which has become a prime target of shoplifters who then resell it. Signs posted on the shelves direct shoppers to the pharmacy, or to the service desk when the pharmacy is closed. Dominick's is not alone.
"We try to locate the baby formula in a conspicuous spot where it is visible, though a few stores have the same signs, 'Please ask at the service desk for formula,"' said Frederic Van Roie, director of merchandising for D'Agostino Supermarkets, Larchmont, N.Y. D'Agostino has found that infant formula is the fourth-most-likely item to be stolen, after meat, batteries and over-the-counter medicines.
In rural Worthington, Minn., DSD manager Bruce Kraft at County Market said, "We watch it by stationing someone in the aisle who can also do stocking or facing of goods forward on the shelves at the same time."
For some time, County Market has had a policy of not refunding money on baby formula certified by the federal Women, Infants and Children nutrition program, Kraft said, although it will make exchanges if the customer says the formula does not agree with the baby.
Supermarkets have been locking up baby formula for three or four years, according to an attorney who specializes in antidiversion and anticounterfeiting, tracking goods from start to finish. "Infant formula ranks up there in the top five" of organized theft targets because it's such big business, said the attorney, Donald DeKieffer, of DeKieffer & Horgan, Washington, D.C.
A report done last year by his firm, which represents consumer product manufacturers, said the theft of infant formula dates back to the early 1990s, when mass retailers began selling formula below cost to attract families. A lot of stolen formula ends up in poor neighborhoods, he said, generally not in supermarkets but mom-and-pop-type stores, while the relabeled merchandise can wind up anywhere.
A retailer can lose $8,000 in a day to stolen baby formula, DeKieffer said. "That can happen in half an hour. These aren't teenagers out for a thrill, but organized criminal gangs," he said. The biggest danger to the manufacturers is the relabeling scam, which happens often enough to be of extraordinary concern, he said.
Theft of infant formula, much of it certified in the WIC program, has been a problem and continues to be, according to Chuck Miller, vice president of loss prevention services for the Food Marketing Institute, Washington.
Product is stolen in various ways, he said. Mass shoplifting early in the morning or late at night, when supermarket employees are scarce, is done by teams of two or three using shopping carts and using one team member to distract an employee.
Miller said FMI is gathering information from its members, of hits of $100 or more, tracking the stockkeeping unit, the name and type of item, and the names of persons apprehended for shoplifting. "We are attempting to find out what it really costs," he said.
Karen Ramos, spokeswoman for the Jewel-Osco chain in Chicago, said those stores also have a problem with theft of formula.
"It's only in certain places, and not confined to the city," she said. "Some of our stores lock it up. This way, a customer who needs it can find it. We hate to disappoint our customers."