PRICE CHOPPER FINDS SELF-SCAN ACCEPTANCE

DENISE ZIMMERMAN

CLIFTON PARK, N.Y. -- A single-store test of a stationary self-service checkout scanning system at Price Chopper Supermarkets is generating strong consumer participation.

On average, more than 20% of the customers at the Price Chopper store here use the system weekly, said Tom Nowak, vice president of management information systems at the Schenectady, N.Y., chain. The store is outfitted with four self-service stations.

In addition, the system continues to attract increased customer use. Preliminary results of the test program, which has been in place for about one year, reveal that both sales volume and shopper participation "have yet to level off," Nowak told SN.

The customer acceptance rate was particularly noteworthy, he said, considering that none of the 15 existing traditional checkout lanes had to be removed to accommodate the self-scanning stations.

"We didn't force anybody to use the [self-scanning] lanes. Our whole rationale was to go in and see how many people -- without being forced -- would use this type of operation," Nowak said.

Price Chopper expects to complete testing the system this fall and then to determine whether to expand the service to other stores. "On paper this whole concept looks very strong. We think the payback is going to be there," Nowak said.

Predictably, the primary user of the self-scanning system tends to be purchasing only a limited number of items. Most transactions processed at the self-scanning lanes consist of five to 10 items, which together represent

7% to 10% of total store sales, he said.

As part of its evaluation of the program, Price Chopper also is trying to create a demographic profile, based on exit interviews and data compiled from the self-scanners, of who the "convenience" shopper is that most frequently uses the innovative system.

"We've found that there's a core group that likes to use the self-service. Why? Because we can give them more points at which to check out their groceries without [requiring] a great increase in our labor costs," Nowak said.

The self-scanning stations are almost completely automated. Shoppers initiate an order via a touch-screen computer monitor and scan their purchases before bagging them. After selecting a payment option -- cash, credit or debit -- the system accepts payment, dispenses change and generates a receipt.

By studying store traffic patterns and using self-scanners, Price Chopper may be able to trim labor costs by linking its regular express lane traffic with the automated stations. "Since a convenience type of order seems to predominate through this system, we are going to integrate our express lane checkouts into this configuration," he noted.

For example, a cashier currently assigned to oversee the self-scanning transactions via video monitor is underutilized during certain times of the day. That cashier might be able to operate a traditional express checkout lane during slow periods.

Price Chopper continues to add self-scanning service enhancements targeted to the "convenience" shopper who most frequently uses it. "I wouldn't say the system is finalized at this point in time. We are still refining it," said Nowak.

Banking services, for example, may be added to the system. "One of the future directions for this type of equipment is to include more self-service features. It could handle banking functions or dispense lottery tickets -- any types of service desk transactions we have now are candidates for inclusion. "It's kind of a customer convenience center. That's probably the ultimate way that we are looking at it," he added.

Ongoing development of the stationary self-scanning stations at Price Chopper has been shared by the chain and the system's designer, Optimal Robotics, Plattsburg, N.Y. The Clifton Park store is the only test site of the system.

"We've been co-developing the concept in terms of its configuration and functionality," Nowak said.

"The system is far from static: it does not look the same now as it did 10 months ago."

Recent system modifications include simplifying how the shopper interacts with the computer monitor to select payment and other options, and creating a more sensible physical layout, Nowak said.

"We made the screen much more user-friendly and less intricate. When we first went into it, we tried to make the system duplicate every single function that our existing cash registers perform," he said. "That was overkill."

Unnecessary system functions were eliminated. "Shoppers don't have to make as many decisions on screen anymore. The other part that we changed was the layout of the station, to make it as convenient as possible in terms of moving product from the cart, through the scanner and into a bag," he said.

Other changes also were made. "Initially, when customers filled up a bag, they had to move the bag to another area and then move it to the cart. Now we have a bagging station that can accommodate up to six bags," which is far larger than the typical transaction, he said.

Nowak said the self-scanning test program has provided a wealth of learning opportunities and fits in well with the company's move toward an open systems architecture.

"The other reason we like this system is it's based on an open systems concept and that's the way we're going with our conventional checkout system," he added.

Another Price Chopper store, also in Clifton Park, recently replaced traditional point-of-sale terminals with personal computers at the front end in a move toward open systems.

The PCs have been tested at other Price Chopper stores, but the Clifton Park site will focus somewhat on the use of computer displays that face the shopper and different models of scanners.