Source: Albertsons
Will new laws check self-checkout growth?
Grocery self-checkout has long had its detractors, and the technology could soon face legal hurdles that may affect how stores use it.
Rhode Island state representative Megan Cotter (D) has introduced a bill that would limit self-checkout use in grocery stores, reports The U.S. Sun. The bill, H5161, would only allow grocers to have eight self-checkout kiosks in operation at once. It would also make grocers give customers a 10 percent discount when using self-checkout for more than ten items.
Ms. Cotter said that the legislation was primarily meant to protect jobs. She criticized self-checkout for letting grocers foist the work of scanning items onto customers without compensating them and for alienating older customers who need help with technology and enjoy conversations with cashiers.
Grocery stores have used modern self-checkout stations in some markets since the late 1980s, but they became a more regular sight nationwide in the early 2000s, as a recent CNN Business article reported. Customer ambivalence over the technology led some major chains, like Albertsons, to remove their self-checkout deployments by the end of that decade. The article details some challenges with the technology, including its tendency to increase shrink for retailers. It characterizes it as “unloved” but slated to grow due to a technological “arms race” between retailers and an inaccurate perception that it speeds transactions.
A recent local news report from Maine, however, finds that, at least in that state, self-checkout might not be all that unloved. Maine shoppers discussing self-checkout on Reddit were mainly against the imposition of 10-item limits, WCYY reported. Proponents of unlimited self-checkout say it allows them to shop without being bothered, giving them a sense of comfort and control.
New technological advancements have attempted to improve the self-checkout experience and reduce shrinkage.
Vendors have begun developing machine vision-based solutions that allow self-checkout scanners to automatically recognize fruits and vegetables. This prevents customers from intentionally or accidentally keying in item numbers for cheaper products and undercharging themselves.
Discussion Questions
DISCUSSION QUESTIONS: What do you think of the proposed limit on self-checkout registers and discounts for customers who use self-checkout being considered in Rhode Island? How would such legislation, if enacted, impact grocers’ plans for deploying self-checkout solutions?
Poll
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Bob Phibbs
President/CEO, The Retail Doctor
Mel Kleiman
President, Humetrics
Self-checkout should not be legislated. Like so much legislation that’s well intended, this type often has unintended consequences. Retailers should be able to determine how and when they offer self-checkout to their customers, and their customers decide if they like it or not. I doubt that this type of legislation will go very far.
This is an absurd and ridiculous proposed law. Legislators should not even be considering this type of matter. How a grocery store operates is not of their concern and most don’t even have a clue how such businesses work. If Ms. Cotter feels so strongly she should go set up her own store rather than trying to dictate to retailers – which are pretty good at understanding consumer demand – how to run their businesses.
I can understand if legislation said you must have “X” number of cashier stations opened (like one to three) but this particular bill has no business in business.
Great points Stephen! It seems like the proposed legislation is intended to protect jobs. It seems like a ridiculous objective, especially in an industry where companies are struggling to hire enough staff. It seems like there are much more important issues for legislators to focus on than the quantity of self-checkout units in stores.
Next up: self-checkout to be available only on Tuesdays!
We have been discussing the pros and the cons of, and consumers’ varied opinions about, manned vs. unmanned register lanes for some time — but this is a new one! I don’t agree with legislating this. The customer or the economics will decide the rate of adoption. Retailers have the tools to measure the usage and savings (if any) of self-checkout. Consumers have their preferences and they will speak through their loyalty to one retailer or another. Legislation of this issue is superfluous, unnecessary.
Retailers are already fighting shrink at self-checkout. Why make them fight unnecessary legislation, too? The Rhode Island law makes no sense from a retailer perspective as grocery margins are so low they would be giving away the product at 10 percent off. I believe self-checkout is here to stay and shoppers who don’t like it can vote with their feet and shop elsewhere. They won’t leave. And as the technology improves, it will be similar to Just Walk Out.
On the other hand, the idea of giving shoppers a discount for using self-checkout actually makes sense, but this should be a marketing and merchandising decision that comes from the retailers, not from the lawmakers. Also, customers already ignore item limits at express lanes. Why should self-checkout be any different? There’s no law against egocentric shoppers — yet! Retailers need to continue using psychology to their advantage. Self-checkout is just another new puzzle to solve.
I’m an avid user of self-checkout lines because they are convenient and I’ve never thought of requesting a discount for their use. I value self-checkout’s availability and it’s a way for me not to get stuck behind the “chit chatters.” Government needs to exercise greater restraint and represent all of its citizens. That seems to be a very tall order these days but I hope some aspect of “not waiting for chit chatters” (aka self-checkout) remains.
It’s a heartfelt idea that’s good PR and may excite some voters but c’mon, that proposal has NO chance of passing. You can’t tell businesses how to run their operations unless they’re doing something egregious, which self-checkout is not. I use the “selfies” at Whole Foods and they’re simple to use, manned by an attendant and never break down. Perfect for a small purchase — in and out in a flash. I personally would thank a grocer that does it right. Additionally, if you’re going to compete, you actually MUST have self-checkout. If I were Ms. Cotter, I’d shoot for higher pay for grocery associates rather than screwing with grocers’ business models.
Isn’t it illegal to pump your own gasoline in New Jersey and Oregon? Seems weird to anyone else in this country, but that’s the precedent she’s looking at — never say never!
The rationale for those laws is safety (absurd though the claim may be). I doubt that is the case here.
There’s no doubt that grocers are using technology to reduce labor content, and self-checkout further shifts that labor to the consumer. That said, consumers that choose self-checkout do so to avoid long queues, especially when they only have a few items. Those with full carts that choose self-checkout will clog up the flow because these units are not designed for speed but for catching intentional or accidental non-payments.
The bottom line is that business competition forces companies to find ways to differentiate and lower costs. Technology has been an essential lever in this evolution. Customers can choose where to shop and whether or not to use self-checkout stations. Introducing legislation to limit their use and forcing discounts is a clear overreach and an unnecessary complication.
The proposed limit on self-checkouts would mean longer lineups and frustrated customers. Frontline workers are still in demand, evolving from scanning items to tech troubleshooting.
This legislation could slow store automation plans and bolster demand for e-grocery.
This is ridiculous and if the people of Rhode Island are smart they will kill this proposed legislation before it hits the ballot. Grocers are smart, savvy entrepreneurs who work very hard at delivering good/great experiences every single day to the consumers of America. Let innovation and the normal market forces dictate how many self-checkout lanes a store operates. If these dynamics support one or twenty lanes, then great. But no law should force a grocer to follow absurd proposals such as this.
A 10 percent discount for a business with single digit profitability? Brilliant. A really bad solution for an otherwise solvable problem.
Full disclosure: I avoid self-checkout at every opportunity. And I resent my local grocery store having ten self-checkout lanes open while 24 of 25 “legacy” lanes are closed. I get that retailers have a hard time filling positions and self-checkout is a stopgap, But I also know that this is, in fact, a margin-building scheme where the cost of a checker has been passed to the consumer, under the guise of “service.”
I don’t think legislation is the answer to this. I want to think the market will sort this out. But I’m also a realist and see that the cost and labor benefits to the retailer outweigh any customer service concerns. I do wonder about the massive increase in shrink we’ve seen at some retailers lately and can’t help but wonder, like Wegmans did, if that’s a result of dishonest customers enjoying “not being bothered” while they shop.
I’m fighting a losing battle here. I’ll continue to be “that guy” and ask the team member at Target who looks over the self-checkout “pit” where my employee discount button is since I’m doing their job for them. And my wife will continue to ban me from family shopping trips because no one likes a grouchy old man. OK, gotta go shoo someone off my lawn now.
Gary, I fully support your efforts to avoid self checkout. I, too, avoid them at every opportunity — primarily because I find that they never work well in almost every application. Unless I am carrying 4 or 5 clearly marked items with perfect barcodes, I know that the self checkout will likely fail to recognize at least one item I am carrying. When I hear of shrink issues in self checkout I wonder how much of that is not because the consumer intended to cheat the retailer, but because the item couldn’t be scanned properly.
What did you see about Wegmans, self checkout, and shrink?
All I recall is Wegmans discontinued the scan and go type app which allowed customers to scan and bag items on the sales floor, due to shrink.
Nothing about standard self checkouts which Wegmans has tons of in their stores including new installs in the past couple years.
While I’m not a fan of self-checkout, this is someone trying to make a talking point, not solve a problem. It will go nowhere.
A few years ago I read about proposals to tax robots because companies have to pay taxes for people they employ. In some ways these proposals might be an attempt to achieve the same aim. Ultimately self-checkout is focused on saving cost to preserve margin — so costs for these stores could be higher.
Self-checkout is something individual customers either like or don’t. Those that do will use it for when they have a few items or a full shopping cart based on their preferences. Or when the regular checkout lanes are backed up. Retailers adjust their self-checkout strategy based on consumer preferences and their perception of the cost/benefit ratio.
It interesting that this legislation is seen as a job protection effort. Every supermarket I have gone into has a number of people who monitor the self-checkout process for two reasons: to prevent shrink and to assist customers who are having issues. This legislation looks like a political stunt under the guise of job protection.
I don’t like the proposed limit. I understand the concern for jobs, but this is the way the world works. We advance with new technology other opportunities open up. It may not be the same, but consider what happened to the music business when streaming replaced CDs. Jobs were displaced, not completely eliminated. Innovation can make products obsolete — along with the industries that manufactured them. That’s the way we move forward.
In a free market capitalistic system, under no circumstances should the amount of self-checkout slots be legislated. While the self-checkout operating model is far from perfect and full of friction points, Ms. Cotter and the Rhode Island government should stay out of the self-checkout grocery discussions. Grocers in Rhode Island and other states should be free to decide how to run their operations without the government interfering.
I am not in favor of the proposed limit to self-checkout registers. The retailer must have the liberty to adjust their self-checkout strategy based on consumer preference, while customers have ability to do unlimited self-checkout and shop without being bothered, giving them a sense of comfort and control.
Ms. Cotter said that the legislation was primarily meant to protect jobs. Although self-checkout counters eliminated some of the tasks of traditional cashiers, there will still be a need for IT jobs, tech maintenance jobs and trained staff to monitor the self-checkout stations. During the pandemic, customers opted for self-service to avoid close interactions with cashiers and baggers and now many customers prefer the convenience of self-checkout.
New advancements in self-checkout technology have improved the shopper experience and reduced shrinkage. For example, the use of machine vision-based solutions that allow self-checkout scanners to automatically recognize fruits and vegetables. Self-checkout most likely will become an integral part of retail stores, just like the “self-service supermarket.”
I love the idea because we need laws like this to give the government more control and power over common-sense business decisions. Now the state government will need to hire more people to enforce the law and tax the citizens more to cover their salary and benefits.
Some of the experts on this post say this will never fly, but the citizens of New Jersey haven’t been able to pump their own gas since 1949 for many of the same reasons. That said, if it passes – I doubt it will be widespread.
I hate self-checkout as it currently exists in most stores. I preferred using an app on my phone to scan as I shopped, resulting in a faster checkout and quickly getting me out of the store. ShopRite’s mobile app-based process is a great example.
But this law? Is Rep. Cotter going to legislate similar job preservation in other industries where technology has led to a workforce reduction? Good luck attracting new businesses to Rhode Island if passed into law.
Government meddling at its worst.
So the response is to legislate how customers should grocery shop? Next we’ll see a bill on how big the grocery carts can be or how many heads of lettuce we can buy — because it’s somehow unfair otherwise.
Grocers have many operational moving parts to deal with, and a healthy dose of government involvement as it is. They don’t need more.
Personally, I am not a fan of self-checkout lanes at grocery stores or any other store. I am often quite disappointed from a customer service perspective at home improvement stores that choose to operate exclusively with those self checkout lanes despite the most awkward of items one tends to buy at these stores that are nearly impossible to scan unless you “know the trick” as most store associates will know.
That said, I don’t see this legislation going anywhere. While a discount for using a self checkout lane does sound appealing, discounting 10% on a business that already has a single digit margin is bordering on the absurd. This is not good government. Trying make this about preserving jobs is a distraction — if that as the intent, the legislation wouldn’t be about self checkout, it would be about guaranteeing a minimum number of checkout lanes. That would be equivalent to dictating costs to retail businesses, so I don’t see that going anywhere either. The fact is, retailers will leverage self checkout if they need to both from a cost perspective and also from a labor shortage perspective. Most grocers need their employees completing multiple tasks, not just checkout, and there is a real issue with staffing today that would only get worse with legislation like this.
Why stop at self checkout? We also need to get rid of or limit ATMs, kiosks at airports, those “automated postal machines” at the post office and most certainly if offered in RI those DMV kiosks have to go. After all we need to preserve jobs and ensure the personal touch.
Also those self serve gas pumps, drink machines, car washes, better limit or ban those too to help preserve jobs and keep the personal touch.
Back to being serious, a lot of retailers I know can’t hire cashiers even at $16+ per hour. For example Saturday afternoon I was in two busy Target and Walmart Stores. Each had one register open and self checkouts (Target had 12 self checkouts being overseen by 2 completely unfocused employees and Walmart has about 22 self checkouts that were being loosely overseen by 5 not so focused employees). So without a labor pool this type of legislation can not work.
Self-checkout serves a purpose and there are customer groups that are definitely fans of having self-checkout as an option. Ultimately retailers are dependent upon meeting their customers’ needs and if those needs aren’t being met, their customers will go elsewhere. Legislation is not necessary to protect jobs, as ultimately, other retailers will cater to customer segments who want the human-to-human checkout experience. This is where retailers will differentiate themselves and start to segment towards different customer bases. In the J.D. Power 2022 Home Improvement Retailer Satisfaction Study, almost a quarter (24%) of customers used self-checkout during their last purchase at their primary retailer. In this environment, self-checkout led to lower satisfaction scores where those who used self-checkout gave a score of 823 (on a 1,000-point scale) vs. 858 among those checking out with a store associate. Though some customers prefer self-checkout, overall, there is a negative impact to the customer experience.