Most retail pundits agree that one of the best ways to make food shopping more convenient is to expedite the checkout process.
"Shoppers' No. 1 complaint in focus groups is the time it takes to check out," said Thomas D. Murphy, former Kroger IT executive and president of Peak Tech Consulting, Colorado Springs. "So anything that speeds up the checkout is seen as a huge convenience."
Starting with scanners in the 1970s, technology has helped retailers to reduce wait time at the checkout. In recent years, self-checkout lanes have emerged as a popular option for time-pressed shoppers, and now some stores are testing self-scanners that take the self-checkout concept into the aisles.
Biometrics is another technology whose ability to simplify the payment process is leading more stores to install it at the POS. And cell phones are now starting to serve as both a payment and a loyalty vehicle. Over the next decade, RFID tags and readers may allow shoppers to roll their carts straight through the checkout lane with no waiting whatsoever.
Among the new crop of time-savers, "self-checkout lanes have got to be No. 1 on a retailer's list," Murphy said. "Everybody knows it works and consumers love it. You're kidding yourself if you don't have it. It would be like a bank not having an ATM machine."
In 2004, consumers spent over $82 billion on self-checkout transactions at retailers, up 96% over 2003 due to increased usage in supercenters, warehouse clubs and do-it-yourself stores, according to IHL Consulting Group, Franklin, Tenn.
John Saccomanno, director, retail solutions division for self-checkout vendor NCR, Duluth, Ga., pointed out that self-checkout even helps shoppers who don't use it by making conventional lanes less congested. For shoppers who do use it, self-checkout offers a faster alternative - or at least the perception of one.
"Over 20% of our customers [in self-checkout stores] use self-checkout regularly," said Steve Methvin, director of store systems, Bi-Lo, Mauldin, S.C. "Close to 80% use it at some point. It's part of our business." Most shoppers use self-checkout for small orders, he added. Of the 315 Bi-Lo and Bruno's stores operated by the company, 136 currently have self-checkout.
Bi-Lo is taking a somewhat novel approach to upgrading and expanding its self-checkout installations. Instead of simply installing new systems from one of the major vendors - NCR, Fujitsu Transactions Solutions or IBM - Bi-Lo is buying self-checkout software from ECR Software, Boone, N.C., and installing it on existing hardware, typically the U-Scan system from Fujitsu.
Bi-Lo has so far converted 25 of its 136 self-checkout installations to ECRS software. The software "gives us more flexibility" when upgrading self-checkout systems in other formats such as its Bruno's outlets and stores acquired from Winn-Dixie, Methvin said. It also allows Bi-Lo to install used self-checkout hardware in low-volume rural stores, where a brand-new system would be too costly.
For all of its allure, self-checkout is not unequivocally embraced. For example, because of its emphasis on personal service, Piggly Wiggly Carolina, Charleston, S.C., has not reached a consensus on self-checkout, said Rich Farrell, vice president, information services. "We're re-evaluating our self-checkout strategy."
Food Lion's five Bloom stores, based in the Charlotte, N.C., area, were designed specifically to reduce the hassles and improve the convenience of the supermarket shopping experience. In particular, the stores aim to minimize the time spent in the store, especially at the checkout, as well as help customers find items and simplify meal decisions and preparation. New Bloom stores are opening in Greenville, S.C., and Washington, D.C., this year.
Bloom stores offer both self-checkout lanes and self-scanners. Shoppers use self-scanners to scan items during the shopping trip, taking care of the most time-consuming part of the checkout process, which they complete by paying at a traditional or self-checkout lane. Besides expediting checkout, self-scanners appeal to shoppers in other ways, said Susie McIntosh-Hinson, a member of the initial Bloom concept team, in a presentation last fall at the GEMCON conference in Las Vegas.
For example, by tallying up their order as they shop, budget-conscious shoppers can avoid exceeding their budget for that trip. As a result, they need not "fear the embarrassment" of not having enough to cover their bill at the checkout lane, and can spend right up to their limit rather than staying well short of it, McIntosh-Hinson noted. Self-scanning shoppers can also bag groceries the way they prefer, and avoid having their products handled by others at the checkout lane, she added.
Another store offering both self-scanners and self-checkout is a Giant Super Food Store, Camp Hill, Pa., opened last fall by Carlisle, Pa.-based Giant Food Stores, a division of Ahold USA. The EasyShop self-scanners have generated the most "buzz" from customers, said Giant spokeswoman Deb Stover. "However, we have more customer utilization through EasyScan [self-checkout lanes] with the store having nine self-checkout lanes."
Dispensing With Cards
Meanwhile, finger-scanning biometric payment, promising faster checkout and the ability to dispense with plastic cards, made significant strides in 2005. Piggly Wiggly Carolina completed the rollout of biometric payment technology from Pay By Touch, San Francisco, to all of its 82 company-owned stores. Cub Foods, a division of Minneapolis-based Supervalu, announced it is rolling out the same system in its 24 Chicago East Region stores and in the 65 stores in its West Region.
"The big thing is the convenience," said Piggly Wiggly's Farrell. "You don't need your cards, your wallet. You just use your finger on a scanner and buy whatever you want."
Some retailers are allowing shoppers to dispense with their loyalty cards at the POS by making their cell phones the bearer of loyalty club identification (see story, Page 59).
Biometric payment is also perceived to be more private and secure than card payments, said Peak Tech Consulting's Murphy. "You leave your card home or locked in the car so it can't get stolen in the parking lot," he said, noting that female shoppers especially appreciate that.
Murphy predicted that biometric payment "will catch on and eventually become mainstream, like ATMs, self-pumping gas and self-checkout."
For Piggly Wiggly, biometrics isn't only about making the POS more convenient for shoppers. It also represents an opportunity to steer them to a form of payment - ACH, or automated clearinghouse, overseen by NACHA, Herndon, Va. - that is less costly for the chain to process than other electronic forms of payment. Currently, 70% of the chain's biometric transactions are processed via ACH, the rest by credit card and cash (when shoppers ID themselves to gain loyalty benefits).
Farrell said Piggly Wiggly has been able to get shoppers to link their fingerscans to their checking accounts via ACH partly by making ACH the first option to pop up on the menu at the POS. In addition, biometric users who link to their credit card still have to sign a form.
Thus far, biometrics' appeal has been narrowly focused at Piggly Wiggly. Six months after rolling out biometrics chainwide, Piggly Wiggly has signed up about 5% of its shoppers for the program. "We're looking for 10%," Farrell said. "We'll get there."
Some hurdles include the length of the enrollment process, during which shoppers provide their initial fingerscan. "Some people don't want to use their finger or provide driver's license and checking account information."
Another issue is that 3%-4% of shoppers have fingers that can't be read biometrically and therefore can't enroll; occasionally, those who do enroll can't be read in the lane. Overall, though, Farrell called the program a success. "There's a group of shoppers who like it and it's important to us to retain them as loyal customers," he said. "Nobody else in our area offers it now, though it looks like we won't have that exclusivity forever." Biometric users have also been found to make more store visits (by less than 10%), he noted, adding that he expects a return on investment on the technology.
Tracking Time at the Deli
Apart from the checkout lane, the deli is probably the area of a store that shoppers most associate with waiting for service. Just as technology can shorten the wait at the POS, a new system is helping to make waiting at the deli more tolerable.
That system, called DeliVision, from Cuesol, Quincy, Mass., is being piloted at two stores - a Stop & Shop in Pembroke, Mass., and a Ukrop's outlet in Richmond, Va.
The system does two things: It consolidates orders from the counter and deli kiosk into one queue so that one isn't favored over the other; and it uses an overhead screen to announce the order number, type of order (kiosk or counter), and predicted wait time for the next person who takes a ticket and gets in line. The ticket shows the specific time service is expected. The kiosk prints out the time an order should be ready for pickup, and lets loyalty customers select items and quantities previously ordered.
The Stop & Shop store has the complete system, having added the wait-time feature a few weeks ago, according to Mike Grimes, vice president, sales and business development, Cuesol. (Stop & Shop did not respond to a request for comment.) The Ukrop's store plans to add the wait-time feature this month, said Scott Aronson, vice president of marketing, Ukrop's.
The wait-time capability is accurate enough, Grimes said, that more than 90% of the time a customer would have "at most one person to wait behind" at the time designated for service or pickup. "If someone has to wait 11 minutes, she can go bag some oranges and know what time to come back," he noted.