Once upon a time, self-checkout was the preserve of the supermarkets, but not anymore. As consumers become more accepting of the technology, they increasingly want the choice of a self-checkout lane in their local convenience store, writes Gillian Hamill
15 July 2014 | 0
Self-checkout solution providers are reporting a strong demand for self-checkouts not only within the multiples, but also from convenience retailers. The consumer now expects and wants this technology in their convenience store. In fact, research shows they are more likely to do repeat business with a retailer that provides this option. This is due to a number of factors; it’s ideal for small baskets, reduces queue times by up to 40%, builds customer loyalty and appeals to a broad demographic. Customers use self-checkout lanes for speed and more control of their shopping experience. Furthermore, costs at the front end of the business are slashed as the labour cost is removed. Customer service and business efficiencies are likewise improved as the retailer can redeploy staff to other in-aisle activities.
Ioresource: “When it comes to self-checkouts, it is not a case of ‘if’ but ‘when’”
Retail is all about giving the customer what they want, and now more than ever before customers want to control the checking out and payment of products. Self-checkouts have been around for over a decade but it is in the last five years that we have seen their numbers explode, with almost half a million in use worldwide. This increase has not been confined to the tier one grocery market, the initial breeding ground for the self-checkout, but now includes many tier two grocery stores with the first such example in Ireland being installed in a BWG franchisee’s store in 2013 using NCR, the worldwide market leaders in self-checkout, in 2014.
Increased options available
The self-check options available to retailers have increased also with such things as combined scanning; where the customer and a staff member scan simultaneously, convertible units; where a normal checkout can be converted into a self-service option, and unattended slimline kiosks; enabling a self-checkout to be placed in previously inaccessible spaces, all now becoming available. Configurations allowing any type of retail are also now available allowing those retailers who previously would have thought that self-checkout was not an option, to join the gravy train of monetary savings and profit margin increase that self-service brings.
Ensuring business case stacks up
Retailers of course do not have to solely trust the sales patter when making such a substantial purchase as a self-checkout. Given that there are now so many in place, they will be able to find a peer who has benefitted. There is also the option of using the gurus of self-checkout, NCR’s years of experience and employing its Tour Taster process to ensure that the business case stacks up. NCR is the indisputable leader in self-checkout having achieved over 70% of the market share worldwide in shipments of new units in 2013 (the closest competitor coming in at a mere 11%). The company has spent many years and many millions on research and development, ensuring that self-checkout works wherever it is sold and that the retailer must benefit before any installation will take place.
Professional and experienced analysts will spend time in the retailer’s store taking data from everything including sales figures up to what direction customers are facing when making purchases, to ensure that when the self-service solution is installed it will increase the retailer’s bottom line. Self-checkouts of course offer more than just savings on staffing and increased customer satisfaction on speed through the till. There are time savings on tasks such as banking and cash-handling, with the bank note recycler module on NCR’s SelfServ checkout taking care of many of the functions that were once standard in cash offices up and down the country.
Now is the time to act
The simple fact of the matter is that retailers are now discovering that it is not a case of ‘if’ when it comes to self-checkouts but ‘when’. The devices will increase the retailer’s profits and will improve their customer’s positivity towards their store. Subsequently, any retailer not at least considering going down one of the many roads available to them for self-checkout, really needs to be questioning themselves as to why. Many retailers missed the boat when the online shopping ship set sail; they need to make sure that now the self-service one is well and truly out to sea, they are either on-board or making plans to catch up quickly.
CBE has been at the forefront of self-checkout innovation and was, in fact, the first company to offer self-checkout to independent retailers in Ireland. Self-checkout is not a new innovation to retail, but as a major component of the new omni-channel experience, it is becoming a ‘must-have’ element for stores rather than an optional ‘add-on’ as was the case in the past.
Consider your store’s demographics
As with most technologies, a one-size-fits-all approach is not advised as each store must understand their own requirements when considering self-checkout as store size, demographics of users and payment options preferred by customers are just some of the areas that need to be considered. CBE can offer a number of versatile self-checkout solutions with the most popular options to date being the conventional multi-tender unit and the unique cashless terminal. CBE can install a combination of units and as part of its best practice guidelines would suggest that stores integrate self-checkout technology along with manual checkouts in order to satisfy the needs of all prospective customers. CBE has multiple installations throughout the country and feedback from both retailers and customers has been very positive.
Self-checkout has proven to be extremely effective at reducing frustrating queuing times at busy periods without engaging additional staff. In most cases this has resulted in an increase in sales at peak times. Interestingly, with the introduction of self-checkout, the larger supermarkets have also seen an increase in convenience shoppers – especially at the weekends. Self-checkout enables retailers to redeploy personnel at short notice to maximise labour efficiencies. It also ensures that retail stores keep pace with consumer demand and provides a unique customer service offering to differentiate their store from the discounters. In a recent survey, 100% of retailers that have installed the CBE solution would recommend self-checkout to another store.
Building customer loyalty
Whilst there is compelling business rationale for introducing self-checkout, it is the enhancements to the customer’s shopping experience that have been the biggest success to date of the CBE installations. By reacting to market demands and giving customers a choice, it has allowed retailers to build greater customer loyalty. In some cases there is over 30% of sales going through the self-service lanes and when quizzed about their reasons for using self-checkout, most customers cite: reduced queues, faster service, offers choice, more convenient and a better customer service, as the main reasons.
Working in tandem with ‘contactless’
The average transaction at self-checkouts is €11 which is ideally suited to the new contactless technology that has been rolled out throughout the country. This will further speed up transaction times in busy retail stores where speed and convenience are of paramount importance. CBE’s self-checkout technology has been designed to work in tandem with the ‘mobile scan and go’ solution whereby a customer uses their phone or a handheld terminal to scan their products as they shop. The transaction is then automatically transferred to the self-checkout terminal to finalise the payment thereby eliminating the need to commission extra staff to handle mobile scan and go transactions. CBE’s research has concluded that stores who wish to implement mobile scan and go, will have a greater success rate if self-checkout is also installed. CBE’s research to date has categorically proven that implementing self-checkout enhances the customer’s shopping experience, drives loyalty and secures repeat business. If you wish to find out more about CBE’s self-checkout technologies, contact Dominic Feeney on 1890 373000, email email@example.com or visit www.cbe.ie for more information.
Leaders Enterprises Ltd: “It’s not just about the technology but business transformation”
A new innovation for convenience stores in Ireland was the one of the main reasons for Leaders Enterprises wining the C-Store Awards for “Best in Store Technology” in 2013. Self-checkout is now offered to convenience stores in Ireland after Leaders seamlessly integrated its award-winning system SAMforWIN with NCR SelfServ Checkouts. When Leaders Enterprises (SAM POS and computers) researched the global self-checkout market for a partner, the choice was obvious and easily made. NCR is the world market leader. Why NCR?
- World market leader with best-in-class hardware and software solution:
– 76% European market share – More than 140,000 NCR SelfServ units installed globally – Since 2006 over 1,500 convenience stores have implemented an average of two lanes per store
- Over 100 patents issued or pending specific to NCR SelfServ checkout
- NCR invested $100 million in self-checkout R&D during the last 10 years
Benefits of self-checkout
- The return on investment is proven to be very substantial
- The self-checkout solution is ideal for small basket customers; statistics show that average basket size in a small supermarket/convenience store is between two to five items
- Reduce labour cost
- Improve customer experience as it provides customer privacy, offers less queues and customer waiting periods, puts the customer in control, etc.
- It is a proven fact that self-checkout builds brand loyalty
- Improve cash handling security and cash management
- Reduces shrinkage as 42% of shrinkage is related to staff
- IDC study reported that 100% of retailers saw no shrink or reduced shrink after self-checkout was installed
How Leaders Enterprises can help
Over the past number of years Leaders has acquired hands-on experience in the deployment of self-checkout. The company believes it’s not just about the technology but about business transformation. In light of this, Leaders recommends the use of a ‘digital pilot’ to get the most from your investment and clearly define the business goals of this transformation to your store. The digital pilot is a comprehensive pre-install study of a store’s live data, basket size, basket mix, payment type and other trading patterns – removing the guesswork of deploying technology of this nature. Based on this analysis along with in-store observation the exercise will determine the optimum number of units, most appropriate models, predicted percentage of baskets through self-checkout, expected savings and the overall return on investment. In a recent installation of self-checkout in Ireland, results not only met expectations, but exceeded them. The acceptance of SelfServ checkouts in this family-owned country store by customers and staff has proven to be a great success in terms of services provided and financial returns.
Eurospar supermarkets choose NCR and Leaders Enterprises Ltd for self-checkout
NCR,the global leader in consumer transaction technologies, announced last month that Eurospar supermarkets have chosen NCR and channel partner, Leaders Enterprises Ltd, to provide an innovative self-checkout (SCO) customer experience. Eurospar expects that over time nearly a third of transactions will be completed using SCO. The installation demonstrates the operational efficiency and competitive differentiation that SCO solutions can provide for thousands of other local community supermarkets in the Irish market.
Driven by customer requests
“While we were clear of the experiential and business benefits of deploying self-checkout solutions, we have also been driven by active requests from our consumers,” said Declan Ralph, retail development director at BWG Foods. “The installation in Eurospar Kilkenny is an opportunity for us to better understand the impact of SCO on our operations, providing more options for our shoppers locally. The initial results have been very positive.” NCR has also provided the consulting, training and services to help Eurospar to develop and maintain the SCO solution deployed. This solution includes NCR bank note recycling functionality that reduces costs by decreasing the number of cash deliveries required. The SCO solution is also fully integrated with Leaders Enterprises’ front-end software platform, offering a seamless journey to the shopper, whether they are checking out at the traditional point-of-sale (POS) or self-checkout.
Positive reception in Kilkenny
“Like my customers, I am keen to embrace new technology. It helps me run my business more effectively and makes my customers’ lives easier,” said John McCarthy, owner of Eurospar Kilkenny. “Providing a better service to my customers is directly connected to how I run my business. The easier it is for my team to run the shop, the more we can be out there helping people from our local community when they visit us. Efficient front of store and back office systems can save time and improve my bottom line.” People around the world use self-checkout technology for speed and greater control when they shop. Indeed, research, based on extensive industry experience, illustrates that customers are more likely to do repeat business with a retailer that provides self-checkout technology. The NCR SelfServ Checkout reduces queue waiting times by up to 40%, greatly enhancing the shopping experience. It also allows retail employees to be redeployed from front-end checkout duties to valuable in-aisle functions that ultimately increase retailers’ overall revenue through better customer service
Making shopping experience simpler
“Technology leadership is important to retailers and store owners, such as Eurospar and John, as they seek to drive a more engaging experience for consumers,” said Helen Wilde, retail business director at NCR UK. “NCR is working with customers to differentiate their in-store experience by deploying innovative self-checkout technology. In this instance, this is driven by the consumer, the store owner and Eurospar, a particularly progressive retail organisation.” Leaders Enterprises SAMforWin POS is a feature-rich software solution that is integrated into the NCR SelfServ Checkout. The solution aims to make retailers more effective and profitable. “Consumers are driving the retail experience as they increasingly shop using technology to make their lives simpler,” said Adrian Devine, managing director at Leaders Enterprises Ltd. “Working closely with NCR, we were able to respond to consumer demands by providing a fully integrated self-checkout and POS solution. This fulfils the needs of Eurospar and demonstrates the benefits of self-checkout in a supermarket and convenience environment to other independent retailers throughout Ireland.”