Can self-checkout
solve the labor crisis in retail?
Published March 31, 2022
We all know the feeling. We enter a store only to be confronted with a crowded shop floor and long queues at the check-out. Everyone is irritable and stressed and the chances of getting out with our stuff any time soon seem remote. In most cases we’ll turn straight around and head out the door.
That’s an experience more and more of us are having. By the middle of last year, the great reopening was well underway. In June 2021, retail numbers were already higher than before the pandemic. As convenient as ecommerce can be, people still crave the in-store experience.
However, as stores reopened, and customers returned, it soon became clear that one thing was missing – staff.
As the pandemic unfolded, staffing proved problematic
The so-called Great Resignation has seen retail staff quitting in record numbers. Four million left their jobs in August 2021 alone.
As things got back to normal, some workers have returned. Even so, as retailers geared up for the holiday season in November job growth in the retail sector was up by just 2% compared with a national average of 4%. In other words, while demand is rising quickly, staff numbers are failing to keep up.
Stores are feeling the heat. Some have even had to close early due to staff shortages, while others have seen an increase in the number of people walking away. Inevitably those shortages feed through to their bottom line.
A survey from virtual booking software provider Qudini suggests that 25% of customers say they are ‘much more likely’ to avoid entering a store or walk out because of long lines or poor service. A further 28% say they are more likely. According to Qudini’s calculations, retailers could be missing out on a total of $100bn per annum in lost revenue as a result.
Long lines, therefore, are costly. Each customer who walks out is not only a missed sale but will have a possible impact on a store’s reputation. They will be less likely to come back and more likely to share their bad experiences with their friends.
Self-checkout: the small footprint solution that saves the day
The solution, for some retailers, has been to turn to self-checkouts. These have become a common sight over the last few years, especially in larger stores, but the pandemic saw adoption increase. Global shipments increased by 25% in 2020. A study from ResearchAndMarkets.com predicts the global market for self-checkouts will rise at 11% year on year between now and 2026.
These checkouts come with a host of benefits. Firstly, people like them. Research from PYMNTS shows that 80% like the idea of a non-traditional checkout with 66% reporting that self-checkouts were the options they were most keen to try.
According to a report Business Insights, 60% of customers rate long waits at the checkout as their number one pain point of the shopping experience. 83% rate a quick and easy checkout experience as being top of their wish list. The vast majority of customers say that the self-checkout is faster than manned checkouts and 59% say they prefer the experience.
From a retailer’s perspective, self-checkouts have a much smaller footprint than manned alternatives. That means more checkouts within the store, which means the ability to process more customers more quickly. The space saved can also be used for stock and advertising, all of which can further enhance revenue.
Bed Bath and Beyond transforms their checkout experience
Retailers of all kinds are discovering the advantages they can bring. Take the example of Bed Bath and Beyond which recently adopted self-checkouts from NCR across their stores after a successful trial in their flagship New York branch. Benefits included faster checkouts together with advanced capabilities such as computer vision and shrink prevention strategies.
“By incorporating cloud-enabled SCO into its checkout strategy, Bed Bath & Beyond is creating a modern shopping experience that streamlines the trip for customers while simultaneously allowing staff to become more proactive, empowered hosts,” said David Wilkinson, president and general manager, NCR Retail. “Ultimately, it’s clear that shoppers today crave convenience and options, and with this technology Bed Bath & Beyond will be able to deliver both.”
Other customers, meanwhile, for all sorts of reasons will still prefer more traditional alternatives. Self-checkouts, therefore, will not replace human cashiers, but they will provide another option, expanding customer choice and enhancing the overall service offering of the store.
Self-service: the key to solving the labor crisis
For all the reasonable concerns, therefore, the benefits far outweigh any risks. With retailers of all sizes experiencing significant staff shortages, self-checkouts are game changing. They increase customer satisfaction by giving them more options to pay for their goods, reducing wait times and making the whole experience more streamlined and convenient. Crucially, given the current labor shortage, they will enable stores to achieve that magical, but elusive goal, of doing more with less. Self-checkouts may have often been criticised in the past for taking people’s jobs. Now, with more people choosing career options away from retail, they are proving a life saver in taking the pressure off those staff who remain.
The self-service checkout, therefore, is here to stay. Problems will remain and much will depend on the way in which they are managed and the type of technology used to deliver them, which is why it’s so important to work with a professional provider which can help you find the best option for your store.
The retail landscape, therefore, is changing. Staff are harder to find, and customers expect faster and more convenient ways to make their purchases. For both these reasons, therefore, self-checkouts represent an ideal tool to provide customers with the fast and effective, omnichannel experience their customers are looking for.
LISTEN NOW: As published
on The Voice of Retail podcast:
David Wilkinson, President, NCR Commerce on the Future of Self-Checkout, POS & more