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Industry Innovation

Check-Out Free Retail

Check-Out Free Disrupts Retail

convenience store retail operation in action

magine a shopping experience where you can simply collect your items and walk right out of the store.  This seems impossible (and possibly illegal) but it is actually approaching much faster than you may think!  In fact, check-out free options are something many companies and convenience stores are considering.

This does not mean everything suddenly becomes free or that stores are disappearing.  Ever since Amazon first opened up a prototype cashier-free store in 2018, check-out free shopping experiences have been on the horizon.  This process represents a metamorphosis of the typical c-store, even with the challenges it presents.

What Exactly Does Checkout-Free Mean?

In all seriousness, check-out free is exactly what it sounds like: a shopping experience where you no longer have to wait in line and pay.  The typical process of gathering your items and waiting for a cashier or self check-out machine to become available will no longer occur.

In order for a shopping experience to qualify, certain technological underpinnings must be in-place.  In current models, customers will enter with either a pre-downloaded app or by scanning a credit card.  Every item picked up and placed in their basket will be monitored, and payment will be processed once they leave the store.

Retailers leading check-out free processes still utilize real-life employees to stock, organize, and complete other necessary tasks.  Employees also assist with customer service and general management.  Many people who hear about check-out free technology tend to assume it means automation taking over human jobs.  However, this is not always the case.

In typical retail stores, cashiers are still expected to assist with the tasks required for upkeep.  This can include general cleaning in common spaces, stocking and refilling products, and taking inventory. In theory, taking away the position of cashier gives store employees more time to devote themselves to customer issues and managing the day-to-day essentials.

Of course, check-out free options are still not available in many stores.  This could soon change, as Bloomberg reported Amazon hopes to launch nearly 3,000 of their cashier-less stores in 2021.  While the scope of check-out free stores may currently seem small, it is quickly widening.

With that, it becomes apparent that cashier-less stores are becoming more common than previously imagined.  Most stores may hesitate to implement them due to concerns about the technology and how to properly maintain it.  These same stores will soon realize there are quite a few technological options available.

Technological Options for Check-Out Free

To an outsider, check-out free options seem futuristic and complicated.  In actuality, the technology has been in development for quite some time.  Stores do not necessarily need a great deal of money or months of installation to complete the process, and there are different options available.

For example, Amazon GO (the primary example of check-out free technology) utilizes a combination of vision-based software like cameras at different angles and hardware such as weighted sensors to confirm when an item has been taken. These are only a few of the technological options available to stores. Others are as follows:2.

  1. Apps:  Grabango, one of the retailers leading check-out free, utilize an app for their customers.  Users download the app, go about shopping normally, and eventually scan a code formatted in the app in order to pay.  No cashiers are needed in the process!  Similarly, Amazon GO has experimented with apps that keep track of purchases and pay automatically.
  2. QR Codes:  QR codes are small squares that store information or access to other online spaces.  They can be easily scanned by different machines, with the most common one being the user’s cellphone.   If a store wished to utilize QR codes, customers could scan a code associated with each item in order to pay as they go.  Apps also typically use QR codes, as we have covered in the previous section.
  3. RFID Tags:   These devices are typically used for tracking tags attached virtually to different objects.  By attaching radio-frequency identification (RFID) tags to items, movement such as placing an object in a shopping cart will be automatically traced.  In addition, placing an item back on the shelf will be monitored so no mistakes are made.
  4. Machine Monitoring and Vision:  This method is the most likely option to be adopted by retailers, as it uses systems already in place.  For example, cameras already installed for security can be repurposed to monitor item movement.  This also includes weighted sensors utilized by Amazon GO in order to track when an item has been removed or returned.

These are only a few of the technological options that can be combined in order to create a check-out free experience.  As mentioned, most of these are easier installed than one might imagine.  Technology like apps, cameras, and QR codes are already used everyday!

Leaders of Check-Out Free Tech

Amazon is widely considered to be one of the retailers leading check-out free technology, and for good reason.  While the initial prototypes of Amazon GO were smaller convenience stores, they now have opened a bonafide grocery store of more than 10,000 square feet with over 5,000 products.

Amazon is even open to sharing the technology, with their “Just Walk Out” technology available for purchase by other retailers.  Other companies can purchase an automated 'Just Walk Out' system in order to implement check-out free options in their own store.

In addition to Amazon, Grabango is a company that allows customers to simply scan the code in the app instead of waiting in line.  Grabango was created in 2016 and is a prime example of app-based check-out free technology.

Inokyo is a start-up that has been branded the “indie Amazon GO'' and is hoping to become the future of automated shopping.  TechCrunch published the article, “Autonomous retail start-Up Inokyo’s first store feels like stealing” by Josh Constine in 2018 to describe the experience. C o-founder Tony Francis was interviewed as well.

“Cashierless stores will have the same level of impact on retail as self-driving cars will have on transportation.  This is the future of retail.  It’s inevitable that stores will become increasingly autonomous.”  Tony Francis, Co-founder of Inokyo

Retailers leading check-out endeavors can provide insight to other companies and even their own technology, as we’ve seen with Amazon.  The question remains: if these companies can serve as leaders, why aren’t check-out free options more apparent?  The answer lies in the unique challenges stores face in going check-out free.

Challenges of Going Check-Out Free

While the check-out free industry has the potential to change retail, there are challenges implementing the technology.  There is a reason why more stores have not begun the process of changing their customer payment strategies.

  • Size:  To date, most check-out free stores have remained relatively small.  Airport kiosks and smaller c-stores are the ideal size, as bigger c-stores like Walmart would have trouble successfully automating the entire store.
  • Cost:  Although smaller stores are the ideal size for implementing the tech, many smaller stores do not have the resources to successfully offer check-out free options that will not malfunction.
  • Technological Overload:  In order to make sure items are properly recorded, they will need to be uploaded to the store’s overall system.  This gets harder the more items a store has to sell.  In addition, a power outage or tech mishap could potentially derail the entire system.

These are the primary challenges stores face in going check-out free.  However, there are always options open for existing stores.  Bigger companies could open smaller, intentionally check-out free stores as an offset of their brand.  This is ideal since they have the money to properly implement the technology.  Stores can also look towards leaders in the industry, such as Amazon’s Just Walk Out technology available to other retailers.

The Future of Check-Out Free

At this moment, check-out free options are more likely to be implemented in the future.  As studied in Forbes, the reaction to automated and cashierless stores has been incredibly positive.  By reaction alone, it can be predicted that more check-out free stores will be opening.

Reuters predicts that the check-out free industry popularized by Amazon GO could grow up to $50 billion, making it an incredibly lucrative opportunity for businesses.  As the technology becomes more seasoned, it is likely that businesses will eventually adapt at least a few aspects of the process.

Retailers leading check-out free stores serve as a clear model for the success of these options, and the satisfied customers speak for themselves.  Smaller stores and kiosks can serve as the ideal foundations for bigger stores hoping for check-out free options.  Perhaps the smaller locations can serve as quick options in contrast to cashier-focused and larger stores.

Provided that stores remain aware of the needs that come with cashierless stores, employees and customers can successfully transition to check-out free foundations.  The industry remains lucrative and untapped, so we will be seeing more of check-out free stores in the future!

January 20, 2023