Self-Service

Scaling back on self-checkout? 5 ways retailers can make it work

In a post-COVID world, more retailers are turning to self-checkout. The can reduce checkout lines and waiting times, but may not be suitable for customers with many items. It's a fine line. Here are some benefits and downfalls of self-checkouts.

Photo: Network Merchants Inc.

April 22, 2024 by Peter Alcock — Head of Product Marketing, Network Merchants Limited (NMI)

Of all the innovations in modern retail, self-checkouts are possibly one of the most divisive. Retailers and customers alike seem to either love or loathe them. But why, and how are they best deployed? Here are five of the contested benefits, disadvantages and some pointers to possible solutions.

Efficiency

The upside of self-checkouts is that they can help reduce checkout lines and waiting times, as customers can scan and pay at their own pace. This is particularly beneficial during peak hours when traditional checkout lanes may see long queues. The downside to self-checkouts is that they are not well-suited for customers purchasing many items, where scanning and bagging a large shop can be time-consuming and less efficient than using a traditional cashier.

To help address these pain points, retailers could consider restricting self-checkout to shoppers with 10 items or less, and emphasize the speed of the "Express Self-Checkout" lane.
For retailers of large items such as home hardware or building supplies, providing wide aisles and handheld scanners ensures consumers are able to checkout larger items at self-checkout. Interestingly, furniture retailer IKEA actually employs self-checkouts for very large items by having scanners with longer cables.

Cost reduction

From a retailer's perspective, self-checkouts can help in reducing the need for a large number of cashiers, leading to potential labor cost savings. This can be particularly beneficial for businesses operating on tight profit margins. However, self-checkouts are vulnerable to theft, both intentional and accidental. Customers may make mistakes while scanning items or attempt to bypass the scanning process altogether. Retailers should invest in additional security measures (and ironically more staff!), to deter theft and monitor self-checkout areas effectively.

Convenience

One of the advantages of self-checkout is convenience, as customers can have a more autonomous shopping experience and are able to shop at the pace they desire. They can quickly scan items, make payments, and bag their purchases without the assistance of a cashier. This convenience is especially appealing to those who prefer a faster and more independent process.

But unlike traditional checkout lanes with human cashiers, self-checkouts offer limited assistance for customers who encounter difficulties during the transaction process. This can lead to frustration for less tech-savvy individuals or those unfamiliar with the specific self-checkout system.

Having someone on standby, similar to how Target has a worker in the self-checkout lane, to help support customers who need additional assistance or who need authorization when purchasing age-restricted items can be helpful towards those who need a little extra help.

Accessibility

Accessibility plays a huge role in the checkout experience, especially for shoppers who want little to no interaction, older individuals or those who have disabilities and may need assistance checking out. For instance, shoppers with disabilities, such as autistic spectrum disorders, will sometimes go to great lengths to avoid human interaction in an environment which they already find uncomfortable through noise, alarms and lights. Self-checkout features like the reliance on technology, small touchscreen interfaces and the need to lift and bag items can pose difficulties for certain demographics. Be patient and educate your shoppers on how to use your self-checkout systems, and have an additional worker around to help in case a consumer needs additional support.

More cool features

Self-checkouts usually support various payment methods, including cash, credit cards, and mobile payments as well as loyalty card redemption. This flexibility can cater to a wide range of customer preferences and contribute to a more seamless transaction experience. But with more options, especially the technology aspect, self-checkout kiosks may encounter technical glitches, such as barcode scanning errors, touchscreen malfunctions, or issues with payment processing. These problems can lead to frustration for both customers and staff and may require additional maintenance.

Adding additional tech features can be fun in retrospect, but you don't want them to hinder your business operations or negatively affect the shopping experience for consumers. Any new feature usually means another menu choice or step to be navigated on a touch screen. Only add features that are absolutely certain to provide more benefits than setbacks, to ensure you're minimizing friction around the checkout experience and keeping it as simple as possible.

Finally, on payments

Retailers that want to have self-checkouts that support various payment methods are going to have to think about what systems and technologies will provide the best support. Card terminals are usually deployed as either an all-in-one device incorporating a contact reader, contactless reader and PIN pad, or as is common for self-service devices a two or three-part solution with a PIN pad and separate readers.

Countertop PIN pads designed for retail use are often repurposed for use in kiosks and self-service checkouts however this is not an optimal solution. They are designed to sit on a countertop under the supervision of the merchant, not be bolted to a self-service terminal. Devices can be tampered with, disconnected, or stolen, and owing to the way cables emerge and brackets are attached to the device, they can be difficult to clean or sanitize.

Chip and PIN readers are considered the gold standard of card-present payments, chip and PIN with contactless provides the most secure and widely accessible means of card payment, including credit and debit cards, closed user group cards and mobile wallets.

As retailers start to think about the state of self-checkout in their stores, they'll have to take these pros and cons into consideration and find the best way to deploy self-checkout with their business needs and consumer demands in mind.

About Peter Alcock

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Pete has over 25 years experience in technology marketing, joining Creditcall (acquired by NMI), in 2000 from a Swiss telecoms company. A versatile marketer, he has held several management position within the company and is responsible for product marketing and content creation. He has particularly broad knowledge of unattended payment solutions in parking, vending and kiosks. Pete is passionate about music, is a part-time live sound engineer, and has a home studio.

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