Retail

Self-checkout on the move in convenience retail

A large and a small convenience retailer share insights on successful self-checkout deployment.

Image provided by iStock.

October 5, 2022 by Elliot Maras — Editor, Kiosk Marketplace & Vending Times

A businessman in a hurry needs to pick up some breath mints before a meeting. He enters a convenience store and sees five people waiting in line. He immediately exits in search of a better option.

This is just one example showing why self-checkout is one of the fastest growing movements in retail today. While the technology has been popping up in many types of venues since Amazon Go launched in 2016, the demand is especially prevalent in convenience retail outlets.

During this week's NACS Show in Las Vegas, attendees got a chance to learn how both a large convenience retailer, Pilot Travel Centers, and a smaller 22-store chain, Meyer Oil Co., have successfully introduced self-checkout technology in recent years.


Kim Stewart moderates an exchange between Josh Birdwell of Pilot Travel Centers and Alan Meyer of Meyer Oil Co.

Josh Birdwell, vice president of retail and guest technology at Knoxville, Tenn. based Pilot Travel Centers and Alan Meyer, CEO, of Vandalia, Ill. based Meyer Oil Co. shared their insights during a session with moderator Kim Stewart, editor in chief of NACS Magazine.

Labor not the issue

Right off the bat, both panelists agreed self-checkout is not about reducing labor.

"It's about redeploying labor," said Birdwell, adding that self-checkout allows the store to move people away from cashier stations to other areas.

"Labor shouldn't be the number one priority…to me it's about the customer experience," Meyer agreed, noting that a customer can complete a self-service transaction in 30 seconds compared to waiting as much as 20 minutes in a cashier line for the same transaction.

Improving customer and employee experience

The most important goal is improving the customer experience.

"Our transaction counts drastically increase," Meyer said regarding self-checkout. He attributes this to people knowing they won't have to spend 20 minutes waiting for a cashier.

Self-checkout also makes the employee's job easier since it "smooths out" the checkout traffic, Meyer said. Prior to self-checkout, there could be 20 people in line, which stresses the employee. "All he sees is how long this is going to take."

With self-checkout, the employee can oversee four checkout stations simultaneously.

The employee is there to "lighten the experience" for the customers. This includes greeting the customer and offering to help if needed.

"The highs and the lows of the day, it evens out with self-checkout," agreed Birdwell. "It takes all of the count-the-change, scanning, trying to rush that through to get to the next person in line [away from] the employee."

Front and center

Store layout is important for a successful deployment.

The self-checkout kiosks should be front and center at the store, said Birdwell, whose company is in the midst of remodeling all of its stores to offer self-checkout.

"It's important to the guest to see that it's available," he said.

Some retailers make the mistake of not changing the layout of a store and placing the self-checkout in the corner, Meyer said.

"We want that customer to almost subconsciously go to the self-checkout," he said.

It is also important that the customer be able see that someone is available for help.

"The clerk is absolutely driving the experience," Meyer said. The associate waves the customer to one of the checkouts they supervise.

For Meyer, a screen behind the customer-facing checkout screen allows the associate to see what the consumer is seeing on their screen.

"If somebody tries to void an item, [or] somebody tries to buy an age restricted item, we can control those self checkouts from a screen on the back side," Meyer said.

Pilot calls its self-checkout program "assisted checkout."

All products available for self-checkout

It is also important for customers to be able to buy all products at the self-checkout.

"You have to be able to do everything on the self-checkout, including food, including fuel, including age restricted items," Birdwell said. This is doable even though someone needs to check the ID for age restricted items.

Cash acceptance a must

The panelists agreed cash acceptance remains important in self-checkout. Both companies tested credit-only self-checkout and found customers did not favor it.

The most a credit-only self-checkout kiosk did for Meyer's company was five transactions per day compared to as much as 300 for those that also accepted cash.

Even the credit card customers chose not to use credit-only kiosks, an observation Meyer said he doesn't fully understand.

"If a guest walks up to a self-checkout and sees an exception of any kind, it's going to scare them a little bit," Birdwell agreed, adding, "What else doesn't work here?"

Meyer added that the self-checkout doesn't change the ratio of cash to non-cash payments.

Pilot, which now has 90 locations with self-checkout, averages 45% of transactions being self-checkout, with some stores as high as 70% self-checkout.

What about product shrinkage?

What about shrinkage? Stewart pointed out that a supermarket removed its self-checkout offering due to shrinkage.

Meyer acknowledged that shrink is still a concern for his company, but not an insurmountable one.

"Self-checkout in and of itself does not drive inventory theft," Meyer said. If an associate is near the self-checkout, they will see someone removing a price tag from a less expensive item and putting it on a more expensive one.

In a big box store with as many as 20 self checkouts, monitoring customers at all the stations would be hard to monitor on an ongoing basis.

For a convenience store, however, there are not as many items for the employee to watch.

The problem, to the extent that it exists, is usually due to employees not paying attention.

"Self-checkout did not create that issue, our associates created that issue," Meyer said. "There are going to be honest people who walk out without paying."

Everyone must be on board

Birdwell and Meyer agreed that a successful self-checkout deployment requires a company-wide effort.

"Buy in by the store-level associate is absolutely crucial in a successful implementation of self-checkout," Meyer said. The front line employees need to know the technology is not just helping the company, but them, the employee, as well.

To bring employees on board, Meyer's company offers employees a monetary incentive to encourage customers to use the self-checkout kiosks. They get an hourly bump for the first four weeks.

Equipment issues?

The panelists agreed equipment reliability has not been an issue.

With regard to equipment service issues, Meyer said there are usually one or two service calls per month for the eight stores offering self-checkout, which usually is caused by a dollar bill jamming.

Meyer said his company purchases all hardware outright, then pays a support fee for guaranteed service Monday through Friday. There has never been a case where all three kiosks in a store have become disabled at the same time.

The panelists also agreed kiosks with cash recyclers reduce the number of times it is necessary to open the cash box.

"Make it as easy as possible on your general managers," Birdwell said.

The panelists survey guests and have found positive satisfaction.

"We are seeing improved guest scores," Birdwell said.

"For us, a metric of success is: what is the overall percentage?" Meyer said. His company sees 45% to 80% of all transactions self-checkout.

"We want to transform the customer experience," Meyer said.

Photo: Networld Media Group.