Self-checkouts annoy some customers and help shoplifters. Stores add it anyway | CNN Business

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CNN Business
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Self-service payment arrived in the late 1980s in supermarkets. A decade later, it began to spread to large chains and pharmacies. Today, self-checkouts, loved by some and hated by others, have made their way into discount clothing stores and department stores.

Kohl’s (KSS) is testing self-service payment terminals in a handful of stores. H&M has added them to three stores and plans to roll out the program to more than 30 stores by the end of next year. Bed Bath & Beyond (BBBY) first tried self-checkouts at its flagship New York store last year and has since added them to multiple locations. Zara has it in 20 of its biggest US stores.

Additionally, Uniqlo, Primark and other chains have started rolling out self-checkouts in some of their stores.

These retailers are beginning to adopt self-checkout for a variety of reasons, including labor savings, customer demand, and improvements in technology.

Labor is one of the biggest expenses for stores, and they’re trying to save money as costs rise and more shoppers shop online. Self-checkout shifts work from paid employees to unpaid customers.

Self-checkouts eliminate some of the need for human cashiers, which is why retail unions typically oppose the technology. According to the Bureau of Labor Statistics, the number of cashiers in retail is expected to decline by 10% over the next decade, in part due to the rise of self-checkouts.

These stores also cater to customers who prefer self-checkout and perceive it to be faster and more convenient than paying through a traditional cashier. Millions of customers first used self-checkout during the Covid-19 pandemic to minimize close interactions with workers and other shoppers, and got used to the technology.

But these companies’ attempts to introduce self-checkout in stores carry risks, including irritated customers and more shoplifting.

According to a survey of 1,000 customers last year, 67% of them said they had experienced a breakdown at an automatic checkout. Mistakes at kiosks are so common that they’ve even led to dozens of memes and TikTok videos of customers complaining about “unexpected item in bagging area” alerts.

Customers make honest mistakes scanning barcodes and intentionally steal items from unmanned self checkouts.

“It presents real challenges,” said Adrian Beck, an emeritus professor at the University of Leicester and a retail industry consultant who studies self-checkouts. Retail losses are higher at self-checkout stations than at staffed checkouts, Beck found.

Traditionally, clothing stores and department stores have used rigid security tags on merchandise to prevent shoplifting. This is a problem for self-checkouts: customers are not used to removing security tags themselves and most self-checkouts are not equipped to do so.

To circumvent this problem, some clothing stores use wireless “radio frequency identification” security tags, known as RFID, on merchandise instead of hard tags.

Stores like Uniqlo have invested in new self-checkouts that automatically recognize these tags, eliminating the need for customers to scan products themselves or remove security tags. Customers simply drop their merchandise into a designated box at the self-checkout station and the machine automatically identifies the item and displays the price on a screen.

The spread of self-checkouts to clothing stores and budget department stores also has other impacts.

This creates a divide in retail where one segment of customers gets better service than others, said Christopher Andrews, a sociologist at Drew University and author of “The Overworked Consumer: Self-Checkouts, Supermarkets and the Do- It-Yourself Economy”.

Although shoppers of all incomes visit these stores, luxury brands are unlikely to have customers who perform “quasi-forced unpaid labor under surveillance,” Andrews said.

“Is this a first glimpse of a future where the wealthy get in-person service and the working classes are required to perform free labor to get their food and clothes?”