Removal of self-checkout: 93%

Retail By Numbers is back and this time, it’s inspired by a topic that has incited loads of discussion over the past week. It’s time to get on my soapbox to share thoughts on the future of self-checkouts.

What’s the number

93% of Booths stores will now have no self-checkout option.

This topic has seemingly caused an international incident among our retail industry after Booths announced that they are removing nearly all self-checkout options from their stores. There have been plenty of social media conversations and countless news articles.

The UK supermarket Booths has an estate of 28 stores. Going forward, only 2 stores will still be fitted with self-checkout machines, and these are in areas which experience heavy tourist traffic. The other 93% of stores will operate only with traditional staffed checkouts.

But does this move act as a prophecy of what is to come for the broader industry? Will we see more retailers shedding their self-checkout machines? Or are Booths going to be missing out? Let’s get into it.

Diving deeper

As we read the headlines, it seems we find ourselves becoming involved and emotive on this topic based on our personal preferences as well as each of our own understandings of the broader consumer base. But let’s look at the reasoning behind this approach.

Why Booths are pursuing this strategy

Booths have announced that they are removing the self-checkout machines for customer service reasons.

“We pride ourselves on great customer service and you can’t do that through a robot.” Nigel Murray, Booths Managing Director

They feel that the experience offered through these self-service machines is subpar compared to the human alternative.

Booths have a vision for offering great customer experience and said “We believe colleagues serving customers delivers a better customer experience and therefore we have taken the decision to remove self-checkouts in the majority of our stores,”

But they have also considered and heard from customers and claim “We have based this not only on what we feel is the right thing to do but also having received feedback from our customers.”

However, this move is not universal. They are keeping the machines in two stores in the Lake District where they see seasonal surges of tourists. This holiday-maker traffic is somewhat predictable at a macro level, but offers more variation at a micro level compared to the more formulaic traffic from local residents. Running a checkout operation to cope with these more unpredictable peaks means that either you over-staff and productivity declines, or under-staff and the experience suffers as queues extend.

However, we should also consider that the customer preferences of these tourists may be to opt for self-checkout based on what they’re used to at home. Are we seeing city-dwellers decamp to the Lake District for a change and do they prefer the non-human experience? That’s a whole other topic which we can’t get into right now, but this element of choice is important and we’ll return to this later.

But interestingly, Booths are not the only retailer currently considering the future of self-checkout machines.

• In January, in the Netherlands, Jumbo introduced “Klets kassa” which approximately translates to “chat checkout”. They’ve also introduced a “coffee corner” for customers that are feeling lonely to come in for a general chat.
• Also in January, Sobeys started trialling a “slow social lane” for checkout in one of their US stores where there is a greater expectation of talking with the cashier.
• In September, 沃尔玛 have started removing self-checkout machines in three New Mexico stores, although this seems to be an isolated approach so far.
• And back in 2017, in Scotland, 特易购公司 opened a “relaxed checkout” for customers which was designed with Alzheimer’s patients in mind.

With all of this in mind, let’s consider the case for and against self-checkout machines.

The case against self-checkouts.

I’m sure we all can think of those moments of using a self-checkout when you’re merrily scanning away only to be presented with one of two main frustrations.

“Unexpected item in bagging area” – argh, missed the scan or the weight seems to be causing an issue. Or perhaps you’ve brought along your own bags and they’re not the right type of bag. Maybe you’ll need to call over a store colleague to help overcome the issue.

Or perhaps we suffer the other fate...

“Please place item in bagging area” – erm, it is already in there. And there is the weird act of trying to remove and replace the product, push down on the scales and then having to look around for a colleague to assist.

These two challenges present the primary argument against self-checkout machines. They can be frustrating to use. And whilst some customers act like they’re self-checkout ninjas, others just get more annoyed with every scan.

The argument about being served by a robot offering less service is interesting. Some customers want to engage in conversation out of social need (such as those stereotypical examples of customers where this is the only conversation they’ll have all day) or social preference (essentially enjoying chatting and perhaps even ongoing conversation between the same customer and colleague).

More recently, we’ve seen the issue of shrink and shoplifting rise up the agenda for nearly every retailer and across every category. Self-checkouts are getting some of the blame, either for accidental shrink where a customer has not realised that the item didn’t scan correctly (although weighing scales should catch most instances of this) or where a thief is purposefully deceiving the system, for example, by scanning one item and packing another.

This is a challenge but not solely responsible for stock loss of course. But if more stores remove self-checkouts, will this divert those pre-meditated thieves to those stores that still offer them?

There are other arguments about them, with everything from reliability and maintenance frequency, or to challenges scanning coupons, not being able to process more complex transactions, waiting for ID checks for restricted items, etc. Please feel free to add to these in the comments.

But if that’s the case against these checkouts, why could we think they’re a good thing?

The case for self-checkouts

Let’s start with the two elephants in the room. Self-checkouts can present the chance to reduce the labour budgets in store and run more productive operations. By installing alternative checkout options, main bank checkouts can be removed or closed and there are fewer cashiers. Instead, one or two colleagues can now monitor a large number of self-checkouts simultaneously, running from customer to customer to approve alcohol purchases, overcome pesky scanning issues or helping in another way. However, it’s important to note that not all companies that are installing self-checkout are simply removing the hours from checkouts and overall labour budgets. Whilst the business case for the capex to install the kit is likely to be built from the labour saving, there is also the opportunity to reallocate hours to the shop floor for replenishment or customer service roles. Additionally, there is a good opportunity for multi-tasking between managing self-checkout and carrying nearby replenishment missions, tidying the store or engaging customers in general conversation with customers.

The second elephant is that they can reduce queues for customers. This is certainly true. I’m sure we’ve all been there: wondering which of the traditional checkout queues will move fastest, which customers have a full trolley or a few items, which cashier has the fastest scanning speed.... a complex mental calculation to assess which is the best queue. Instead a bank of self-checkouts means you’re more likely to go straight to checkout. Or in peak periods, we can indulge our inner-Brit and join a giant “master queue” which steadily plods along until you’re at the front and allocated to the next self-checkout that’s available.

But when there is no queue, the self-checkout can present a quick way of getting in and out, especially for those smaller shopping baskets of just a few items. For these convenience shopping missions, overall shopping trip speed is the essence of a great customer experience. As the retail industry, we’ve always known this. We rarely see them now, but we can probably remember those “10 items or less” checkout options for those quick in-and-out trips.

Another consideration point for self-checkouts is improved customer service. This is confusing…. Here we have the same evidence for both the prosecution and the defence. Are self-checkouts developing or destroying customer experience?

Aldi were relative late-comers to the self-checkout game. After starting to use them in 2019, they have steadily deployed more self-checkouts to help customers. In fact, only earlier this year, they further expanded the initiative, claiming “following positive feedback, we are introducing self-checkouts across the county to further improve customer experience”. Now, we could argue about the differences between the Aldi shopper and the Booths customers as two distinct groups, but this would be over-simplifying. We’ll come back to this soon. Ultimately, when considering if self-checkouts develop or destroy the customer experience, we have to consider what we mean by experience and how we measure it. So it can be both but depends on the desired experience for any given customer.

Another factor exists which is often missed: for some customers with invisible disabilities, self-checkouts can present a superior choice. The Guardian reported this quote from a customer: “I have autism and a big part of that is anxiety, particularly of people I don’t know. For neurodivergent people like me a self-checkout is the only way I feel comfortable using a shop. It can be difficult for me knowing I might have to speak to someone face-to-face and the anxiety feels a lot like nausea and manifests in a way that makes me want to avoid the situation. The reality is that I probably wouldn’t use a shop with no self-checkouts.” This is just one example and there are many other considerations about inclusivity.

How should we operate checkouts

Choice is critically important for retail. Customers have their own preferences and offering choice of checkout type is an important part of this puzzle.

Look at ecommerce checkouts for a moment. When different options are added, it increases the likelihood of converting customers. For example, checkout as guest or create an account, or sign in with a Google/Facebook account. Alternatively, customers want to choose the ideal delivery options based on their personal preferences, costs, speed and choice is important. Then at payment, there will be a big performance difference in offering a simple card only checkout vs card + Paypal + Digital Wallets + Buy Now Pay Later + local payment options. Ecommerce checkouts are optimised by having choice. The same is true with offering more choice about in-store checkouts.

We’ve seen other examples of this choice playing out. 亚马逊 have started offering more traditional checkout options in their Fresh stores rather than using their simple walk out tech. Meanwhile, Sainsbury's ran a trial for a cashless store but were quickly met with customers wanting to pay with notes and coins.

And there are more checkout options than we’ve ever had access to. Scan as you shop where you use a handheld scanner, self-scan on your mobile phone (like Jisp ), RFID checkouts (like 迪卡侬 have been spearheading), smart carts, or whole-store vision systems allowing you to grab and go (like technology from Trigo , AiFi Inc. and 亚马逊 Just Walk Out).

With this choice, we also must recognise that customers choose based on their preferences. Different customers will choose differently and this will then mean that the patterns vary across different stores, weeks across the year, days and even times of day. Even the same customer will make different choices based on the mission and mood that they’re in at the precise time of their shopping trip.

But with all of this choice, we need to make a decision still. How many self-checkout machines should be installed, how many cashiers should be scheduled into the rota etc. Here, we need to use the data and really look to understand the patterns and trends. But the data also should offer a fair look at the situation. There is no point having low resourcing on traditional checkouts and then observing customers “choose” or “prefer” self-checkouts. That’s not a fair test. So consider how fair your data is and how you can get a good reading to make the broader decision.

Finally, we need to consider the best course of action for offering great service and supporting customers. With fewer people behind checkouts, I still believe it’s possible to allow colleagues on the shop floor more time to converse with customers in the aisle, where the buying decisions is actually being made, where advice is genuinely wanted, where queries and questions exist and where a meaningful conversation can make the shopping trip truly successful for customers and the retailer.

What’s the bottom line

So, what should you do? Remove all self-checkouts? Or double down on their deployment as the superior option?

Neither is right. It’s about having a blend and allowing customers the chance to choose what’s right for them, in the moment. We want to offer what’s right for them as individuals and collectively, rather than using assumptions, personal preferences or limited observations.

I don’t have the data about the Booths customers' preferences so can’t comment on their exact approach and decision. Although, I hope that this decision has been taken based on fair data and a vision for their own customer proposition, rather than skewed situations or personal preferences.

I hope it goes without saying that different categories and market segments will have different considerations about which is preferential. High-end luxury jewellery vs mass-market groceries is a very different prospect!

All of this leads to one of the factors that I find fascinating about retail:

There is no one right answer.

What works for one company won’t work for another. What drives one customer, doesn’t follow through to the next. Each situation is bespoke. There is no “one-size-fits-all” operating model or customer proposition.

It’s about honestly understanding your customers/organisation/business and your status quo, along with the desired future direction and finding a viable and realistic approach to the transformation.

What are your thoughts on this? Please share reflections and additional considerations in the comments.

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