Achi news desk-
In 2020, Walmart began testing cashless big box stores, first in the United States and then in Canada.
But the pilot project didn’t quite catch on. Walmart tells CBC News that, at this time, there is only one such location across Canada and the United States – in Sainte-Agathe-des-monts, a small town in Quebec.
Meanwhile, over the past eight months, the retail giant has removed all of its self-checkout machines at six US locations, joining a number of other big-box chains that have ditched the machines in some stores, including, recently, a Giant Tiger in Stratford, Ont. .
It’s a dramatic change in the predicted trajectory – instead of the self-service store becoming the norm, some retail stores are returning to the traditional, cash-only format.
“Shops anticipated that this technology would allow them to significantly reduce labor costs,” says Christopher Andrews, sociologist and author The Overworking Consumer: Self-Checking, Supermarkets, and the DIY Economy.
Instead of cutting costs, some stores found that self-bite actually hurt their bottom line, mainly because of theft, Andrews said.
“I think they just miss so much [money] that it becomes an economic liability.”
Machines need helpers
Two weeks ago, franchise owner Scott Savage removed the four self-checkout machines at his Giant Tiger discount store in Stratford, about 90 kilometers west of Hamilton.
He says that rather than stealing, he made the change because many of his customers are older people who don’t like using the machines.
“The biggest complaint you get from everybody is, ‘You don’t pay me to work here,'” Savage said. “They would stick to my regular registers, and they would prefer that service.”
At least six Canadian Tire locations in Ontario have also eliminated self-checkout. Two of the stores’ franchise owners, one in North Bay a one in Torontotold CBC News that they made the move because they felt it improved customer service.
But Andrews says that along with theft, staffing requirements are often the main reasons why retailers abandon self-checkout. The machines need attendants to help customers – while also watching out for thieves.
“What they found was that they couldn’t eliminate a lot of the cashiers, because the cashiers were needed there, in part, to prevent shoplifting,” said Andrews, an associate professor at Drew University in Madison, NJ.
Self-checkout theft is a growing problem for many Canadian stores, and some have started checking shoppers’ receipts to try to stop it — despite backlash from customers.
Several studies have suggests that self-verification theft is a problembut there is no hard data as retailers do not make such information public.
The Retail Council of Canada, speaking to its members, says it has assessed that self-checkout theft is on the rise.
“People love the self checkout, but at the same time, if there’s no control, we’ve seen that theft has increased,” said the council’s CEO, Diane Brisebois.
She says she told some of the culprits that there are organized gangs of thieves who neglect to scan expensive items.
“It could really be three very expensive bottles of face cream, it could be specialist baby formula,” says Brisebois. “They target goods that they know have a high street value.”
‘Shrinkage’ costs money
Earlier this month, CBC News asked Walmart if theft was a factor in removing self-checkout from some stores. A spokeswoman said the chain was considering “several factors.”
But in an interview with ABC’s Good Morning America last week, Walmart’s CEO admitted that the retailer had moved the machines from locations with the highest rates of disappearing goods (known as “shrinkage” in the industry).
“There are a few stores where we’ve made the decision that they’re going to come out of them,” Doug McMillon said. “We want to make sure the checkout process is correct. Shrinking retail is a cost. So enabling us to lower that cost, we can keep prices down.”
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Major US dollar store retailers, Dollar Tree and Below Fivealso recently announced that they are eliminating self-checkout in stores with the highest rates of disappearing goods.
“While adoption rates for self-checkout have been high, we believe there is no substitute for employee presence,” Dollar Tree CEO Todd Vasos said during an earnings call in March.
He said the retailer is removing the machines in 300 stores and cutting them back in thousands of others.
“We believe these actions have the potential to have a significant and positive impact on shrinkage,” Vasos said.
Back at Giant Tiger in Stratford, several customers told CBC News they’re happy the store no longer has self-checkout.
“I like the person-to-person contact,” says Leslie Clayton-Winget. “You can’t say to a machine, ‘Have a good day.'”
Another customer said she fears the technology will eliminate jobs. “I would rather see the people stay employed than [me] do a self-check,” says Angela Weber.
So what does the future hold for self-checkout? Andrews predicts that retailers will continue to look for solutions that will help them solve the problems.
But he warns that any new strategy could also have drawbacks.
“I think we will continue to see them experiment,” he said. “But I think we will also continue to see these kinds of unexpected results.”
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