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When Is Self-Checkout Right for a C-Store?

The Pros and Cons of Self-Checkout

Self checkout kiosk.
M

ore store owners are assessing self-checkout kiosks for C-stores than ever before. Does self-checkout destroy the personal touch? Do self-checkout kiosks encourage theft? Do customers prefer self-checkout options?

While self-checkout technology improves every year, this option straddles a delicate line between convenience and frustration. It's also important to evaluate what self-checkout means for C-stores versus full-blown grocery stores. The frictionless, contact-free experience people prefer at a national grocery chain might not be the experience they want when stopping at the neighborhood "corner store" for essentials, indulgences, and more.

The Benefits

C-store owners who wouldn't have considered self-checkout options a year ago are suddenly viewing this option as protection against labor shortages that may become the norm. Self-checkout kiosks make it possible to keep several registers open without staffing several registers. That means that customers don't necessarily have to wait longer just because a staff member has called out. A store that's losing business due to staffing issues needs to consider self-checkout kiosks. There's also the "positive perception" angle.

Customers perceive self-checkout options to be speedier. When customers are in a rush, they will remember that a specific C-store offers this fast-track option for getting back to the car. This can certainly give one store the edge over other stores in town.

Another benefit of self-checkout options at C-stores is that they offer familiarity.

Many shoppers are simply in the habit of using self-checkout registers at grocery stores. This can make shopping at a C-store that offers the same option feel very natural and intuitive. Following the pandemic, many people are now simply conditioned to avoid in-person interactions.

The Cons

Self-checkout isn't always a perfect fit for C-stores. In many cases, a speedier checkout experience is just an illusion due to the simple reason that many common C-store purchases require age verification via employee involvement. With lottery tickets, tobacco products, and alcohol accounting for much of a store's revenue, self-pay doesn't flow easily unless an employee is standing at attention to dive in to assist with age verifications. An "illusion" of speediness that goes unfilled can actually make the experience seem slower to a frustrated customer with high expectations. According to a 2020 survey, nearly 80% of consumers needed assistance at least once during their self-checkout experience. What's more, almost 30% of consumers using self-checkout were pulled aside by store personnel to check their purchases.

It's also possible that fewer customers will ask for "behind the counter" impulse buys when they're walking up to a kiosk instead of having the traditional checkout experience. C-store owners also need to consider if "speed" actually represents lost opportunities to upsell. That brief one-on-one encounter at the register creates an opportunity for customers to ask questions about products. For example, a customer might ask about an item they couldn't find on the shelf. This provides the employee with an opportunity to direct the customer to the product, suggest an alternative product, or offer to order the product. However, that same customer may simply shrug off the unlocated item when selecting a self-checkout kiosk.

There's also the fact that a self-checkout kiosk isn't everyone's cup of tea. Many people relish the personal interaction they get when visiting a local store. In addition, some customers may simply find the technology too confusing. Finally, C-stores need to face the fact that self-checkout kiosks can increase opportunities for theft.

"In a recent review of shoplifting offenders, 72% said that self-checkout made theft easy to very easy; only 8% answered it made shoplifting more difficult, according to the Loss Prevention Research Council, a trade association," according to Money.com

Self-checkout kiosks present opportunities to fake a purchase, swap product barcodes, weigh the wrong items, or simply slip products into bags without scanning them. According to a report from the University of Leicester, the rate of theft rises from 1.5% of inventory for traditional checkout to 4% of inventory for self-checkout situations. What keeps many stores loyal to self-checkout kiosks is that the "shrinkage" hit they take due to shoplifting is lower than the savings they enjoy. Higher sales with kiosks make this option profitable even if more of a store's inventory is stolen.

Assessing the Benefits of Self-Checkout Kiosks for Convenience Stores

There's a hard truth that C-store owners need to face if they've been resting on their laurels for providing the "quickest stop" in town. All retailers moved into the convenience space during the pandemic. Fueled by a desire to meet the needs of technology-driven customer experiences, grocery and big-box stores increased their usage of self-checkout kiosks. The future of C-stores will be focused on reclaiming the "convenience" market share that was once exclusively theirs. Adopting contactless checkout options is a good start. However, C-store owners need to take the temperature in their specific markets to see if making the capital investment in kiosk technology is necessary.

January 20, 2023

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