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A rash of smash and grab thefts puts retailers on the offensive

Published March 15, 2020
The internet age has helped bike thieves organize networks to sell stolen goods from retailers quickly and efficiently.

Editor's note: A version of this story ran in the March issue of BRAIN, part of our series of articles about smash and grab thefts.

VANCOUVER, British Columbia (BRAIN) — Perhaps under different circumstances, this bike thief could've become a top retail shop salesman or maybe even an industry expert.

"We went down this back alley, and there's a kid there who's got a bunch of (stolen) bikes and equipment stowed under a business stairwell," said Vancouver Police Department detective Rob Brunt. "You could ask him about any component or any frame. But right away he said, 'If I don't have it, I can get it. You just let me know what you want.'"

Brunt, also the liaison officer for bike registry service 529 Garage, has patrolled the streets in Vancouver for 24 years, eight on a bicycle. He has seen retail bike theft develop into an organized black market fueled by the internet, allowing the simplification of transactions through buy/sell apps, Facebook Marketplace and websites.

The pawn shop and flea market days are pretty much over.

"If Craigslist was a bike company, it would be like the second biggest bike store in the world," Brunt said.

J Allard, CEO of 529 Garage and former Microsoft executive, was even more blunt.

"Canyon bikes is not driving mom-and-pop IBDs out of business. Direct sales are not putting excoriating pressure on people in the last 20 years. But Craigslist has blossomed, and stolen bike sales are two million units a year."

Retail bike theft on the rise Allard said the internet allows theft networks to flourish to move the bikes out of the jurisdiction from where they were taken, knowing police don't always share information well. In his estimation, this has allowed retail bike theft to double in recent years.

"Back in the old days, you'd steal a bike, and you'd have to fence it locally," Allard said. "It wasn't efficient to fence it elsewhere. So I'd go to pawn shops; I'd go to flea markets. I might hang onto it in a storage unit for a couple months then bring it to a flea market. I'd use classified advertising in local newspapers, maybe one 30 miles away, but a pretty high risk. Now, I create a new Craigslist profile, and fake email account over a VPN (Virtual Private Network), and I can list 20 bikes."

While statistics measuring bike theft from retailers are difficult to pinpoint — police don't specially list the property taken when publishing overall retail theft numbers — sources contacted by BRAIN said smash and grabs are increasing and becoming more brazen.

"We were at dinner with friends last night and retail theft came up," Allard said. "Stories were shared, etc., but as I was reflecting on my experience, I realized that I couldn't think of one bike shop that I have talked to — both in my 529 capacity or as a rider — that didn't have a retail (bike) theft story. Every shop that comes to mind has some story about a theft that they've shared with me."

Google "bike store smash and grab" and you'll get a litany of news reports and security camera B&E videos.

  • Cycle Smithy in Chicago had $20,000 in bikes and merchandise stolen last February when burglars smashed through the front windows.
  • BikeSource in Littleton, Colorado, had three bikes valued at $13,000 taken in July when burglars backed in a stolen van through the front doors.
  • Arkansas Cycling and Fitness in Little Rock experienced a break-in through a backdoor in July with burglars running out with seven bikes valued at $52,000.
  • Boulder Cycle Sport in Colorado was broken into twice within a month, the first when 17 bikes valued at $87,000 were taken in December 2019, and then $50,000 in bikes in January 2020.

And that's just within the past year.

Bryan Hance, co-founder of registration service Bike Index, said retailers face increasing threats from burglars knowing exactly what they want and doing whatever necessary to enter.

"I don't know how you defend against somebody who's going to steal a Ford F-150 and ram it through the front of your shop," Hance said. "I get interested in the big retail hits because they're such a different animal. These guys are doing this for a living. These are professional crews who steal vehicles and know how to disable or evade cameras."

Thieves know what they want Hance and Allard said often times burglars will bypass the most expensive bikes in favor of mid-priced models because they're easier to re-sell.

"One Surly Long Haul Trucker is like the AK-47 of commuter bicycles," Hance said. "There's going to be somebody in the neighborhood who will pay you $250 for that bike, even though it's a $900 to $1,000 item. Whereas the carbon fiber Cervelo is going to stand out like a sore thumb."

Allard agreed, recounting a retail theft story with slight exaggeration.

The burglars "walked right by this rotating turntable with a $12,000 Scott mountain bike on the thing, with laser lights and smoke machines," Allard said. "There was nothing else you could see in the store. And they left it. It was completely unlocked. And they took two Kona Dews ($599 MSRP). Why would they do that? Then we started scratching our chins and looking at Craigslist ads and started looking at stolen bike reports and tied it back together, Son of a gun, that makes perfect sense. The level of sophistication and brazen behavior continues to stun us."

And Daryl Slater, too. As brand and public relations manager for Kryptonite, he has worked with retailers, including Cycle Smithy, to recommend in-store security solutions, like locking bikes together or to an in-ground anchor.

"What we found in Chicago is that they are pretty sophisticated outfits and know what bikes they want and how long it's going to take them," Slater said. "They have in many cases staked out the shops."

Are bikes headed out of the country?

Brad James, co-owner of Sports Garage Cycling in Boulder, Colorado, theorizes the groups that targeted Denver area retailers late last year sold the stolen bikes in Mexico and South America. James' shop experienced one smash and grab and another attempted burglary within five weeks in October 2019.

"The bikes are 50-90% percent more in those countries because of the import taxes than they are in America," said James, who had 14 mountain bikes stolen and is in the process of reinforcing the security outside his store. "And there are very few good bike shops down there. And even though there are a lot of poor people in those countries, there are a lot of people with money down there, too."

Zeb King, director of the Specialized Experience Center in Boulder, heard the same thing. The center was hit in December and had nine mountain bikes taken. "It's definitely an organized group from what I've heard. We haven't been able to track any of the stolen bikes there or anywhere else."

Scott Chapin, a bicycle industry risk specialist for Marsh & McLennan Agency and its bicycle insurance programs manager, said smash and grabs are the most frequent retailer claim he sees since the program started in 2008. Marsh & McLennan Agency has about 1,000 bicycle industry accounts.

"It's costly with the deductible, the cleanup, and it's really unnerving for these shops that keep getting hit," Chapin said. "And often times it's the same people doing it. Just causes a great big disruption. You have to deal with a contractor to fix your door, your window, or your entire wall if it's a vehicle."

Deductibles for retailers are in the $1,000 range, said Chapin, who added retailers get more latitude from their underwriters being such a large broker.

"They will look at claims frequency, claims severity, really what they're looking at is the loss ratio," he said. "If your business owners policy is $8,000 a year and you've had three claims of $4,000 each, now you have a 150% loss ratio, they feel that unless the bike shop is doing something to significantly mitigate future claims, they are realizing they need to price the insurance according to the risk."

Chapin said bike retailers suffer $2,000 of property damage on the average smash and grab. "I would say, in general, if it's a shop that sells high-end bikes, the value of the bike is the higher claim than the damage to the building itself," he said.

Of course, alarms, cameras, cable locking the bikes, and reinforcing doors and glass is recommended, Chapin said, but that doesn't necessarily guarantee a lower rate.

"What we're looking for are ways to lengthen the time that it takes to get their hands on that bike," he said. "In commercial insurance, we ask questions like, 'Do you have an alarm system? What type? We ask a lot of front-end risk management questions. The underwriter looks at all of these risk factors, positive and negative, it's not guaranteed you'll get a reduced rate (with security upgrades). We talk to the underwriter at renewal, and you will be seen as a better risk if you have this."

Allard said there's a belief among cyclists that getting your bike stolen is a rite of passage, "and it's the same thing for retailers."

"Everybody expects their shops to be hit. So we do the cameras; we do the bars; we try to do some smart things around the shops, locking the bikes, doing common sense things. But most of the time, they're trying to protect themselves with insurance. The premium rises and that leads to margin issues and margin issues lead to people (customers) going to Craigslist, and the cycle continues. It's certainly harmful. It's safe to say it's at a rate that's unhealthy for the industry."

 Sports Garage Cycling experienced a smash and grab last year.
Topics associated with this article: Smash and Grab, From the Magazine

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