This is a tax from California on the rest of the States.
The stores will have to raise their prices in other states to make up for their losses in California.
It is Taxation Without Representation And The Attorneys General of the other States should be filing suit to recover damages.
This was intentionally done by the politicians of California to buy votes for them with our money.
Many stores operate under a model where each store is its own profit center. Stores with alot of shoplifting raise prices on that stores products. If the store with high prices cannot remain profitable, (since paying customers shop elsewhere,) it closes down.