At the EuroCIS 2019 trade fair for retail technology (Feb. 19 – 21, 2019, in Düsseldorf, Germany), self-checkout solutions will be an important topic. According to the annual Global EPOS and Self-Checkout report of London-based market research and consulting firm RBR, retailers worldwide provided their customers with almost 300,000 self-checkout stations by the end of 2017—a 14% rise over 2016. Digital transformation is one reason for this. “When retailers perform tech upgrades on their stores, checkout technology is often an integral part,” states the report.
The U.S. retail trade continues to post the most installations by volume. Major players like Kroger and Walmart both replaced old systems and set up new SCO terminals in 2017. Overall, the number of checkout units delivered (2017 to 2016) rose by 25% in North America and by 20% in the Asia-Pacific region. Especially in countries like Canada and Japan, self-service checkouts are increasingly being used because it is hard to find staff to operate the registers or because high wage costs force retailers to look for alternatives.
Fewer new installations in Europe
The picture for Europe, however, is different. While only 1% more self-service checkouts were installed in Central and Eastern Europe in 2017 than the previous year, the figure in Western Europe was a striking 16% lower. Manufacturers see this as an exception amidst otherwise positive developments.
By the end of August 2017, over 3,000 stationary self-service terminals had been installed in almost 500 stores such as Edeka, the Rewe Group, and Kaufland, according to the EHI Retail Institute. By contrast, German retailers, including Edeka and Selgros, operated a total of just 41 self-scanning systems on the reporting date. However, this number has now increased because the hypermarket firm Globus has entered mobile scanning on a larger scale.
Another still scarcely represented area is self-service technology in the German non-food sector, where only Ikea, Bauhaus, and Decathlon have many self-service checkouts. From discussions and working groups, however, EHI project chief Simone Sauerwein knows that “further DIY store operators as well as retail drugstores are debating the issue in depth.” And so are discount stores. Lidl, for example, is gathering initial experience with self-service technologies through tests. In Great Britain, the retailer has fitted out some of its stores, especially city-center outlets with high customer traffic, with stationary self-service terminals. In Portuguese branches, an app is also being tested that customers can use to scan the goods by smartphone. The Edeka subsidiary Netto is running a pilot project to determine the feasibility of express self-service checkouts at small discount stores.
Usage rates often exceed 20%
The technology is widely accepted by customers. According to EHI, almost all retailers offering self-service stations are satisfied with usage rates. Often, over 20% of transactions are performed using the terminals, though in the cash country of Germany, only where cash payment is possible. On the other hand, the Swiss Migros Group, for example, exceeds the 20% usage rate even though it only accepts card payment. At some busy locations like railway stations, Migros even achieves a transaction share of up to 50%. “Above all, the goal of cutting waiting times using SCOs has been achieved in all companies,” says EHI expert Simone Sauerwein.
Manor AG, Switzerland’s largest department store chain, is taking an unusual approach to integrating self-service stations into the checkout zone. The company has installed hybrid POS systems in over 30 of its food halls. The self-service terminals can be converted into conventional cash registers at any time, allowing Manor to react flexibly to different customer footfall. Furthermore, bagging areas can be arranged variably and adapted to the room situation.
The EHI analyses have shown that the companies surveyed encounter hardly any problems with the functioning of their self-service stations. The technology is mature, providers offer many options, and they accommodate custom requests.
More scope for return on investment
Retailers’ return on investment calculations for SCO systems could prove positive. Firstly, volume effects—i.e., the steadily increasing number of units sold—increase manufacturers’ price flexibility. Secondly, cash payment rates are declining worldwide, so fewer cash modules are needed in self-service systems, saving on upfront costs and maintenance. Manufacturers are working to minimize integration costs.