Walgreens may have overstated theft concerns, CFO says

a top Walgreens The executive acknowledged Thursday that the company may be overly concerned about theft in its stores after the shrinkage stabilized over the past year.

During an earnings call, James Kehoe, the drugstore’s global chief financial officer, said the shrinkage was about 3.5% of sales last year, but that number is now closer to the “middle two.” He also said that the company would consider moving away from hiring private security guards.

“Maybe we cried too much last year,” Kehoe said. “We are stable,” he said, saying the company “is quite happy with where we are.”

Over the past two years, Walgreens has been warning about increased theft. As a result, it hired private security guards and locked the merchandise so it could not be accessed without a store associate.

Kehoe said the company has spent a “fair amount” to crack down on the thefts, but acknowledged that the private security companies they hired have been “largely ineffective”. These guards can do little but call law enforcement or hold a suspect until the police arrive.

Kehoe said, “We increased security in the stores in the first quarter. In fact, maybe we put in too much. We may back off a little bit from that.” He said the company is using more law enforcement as opposed to private security.

A Walgreens spokesperson declined to comment further on the matter.

other retailers, such as walmart And Targethas said that recent shrinkage remains a growing concern.

Walmart CEO Doug McMillan claimed he may have to close stores and raise prices If the problem is not under control. Target claimed in its last earnings report that it recently lost $400 million in shrinkage,

Earlier Thursday, Walgreens released its first quarter earnings, It beat Wall Street estimates after the cough and cold drug surged in demand during early flu season but suffered losses of $3.7 billion after the pharmacy chain agreed to pay a whopping $5.2 billion related to opioid litigation Also informed.