US supermarkets tell shoppers 'do it yourself'

Jean Scheidnes

NEW YORK: Countless shoppers have silently sworn, while standing in line at

the supermarket, that they could work faster than the cashier, and a growing

group of US retailers is offering them the chance. Since the mid-1990s,

retailers have been installing do-it-yourself scanners to entice shoppers with

speedier checkout lines.

"One of the biggest complaints supermarkets face from customers is that

it takes too long to check out. This moves the line faster," said Gary

Rhodes, spokesman for Kroger Co., the No 1 US supermarket operator. Kroger has

what it calls U-Scan stations in over a quarter of its 2,354 stores, and intends

to install hundreds more this year, Rhodes said.

Self-checkout stations allow customers to scan items, process the payment by

cash, debit or credit, and bag the items, all at their own pace. A salesperson

is assigned to oversee the stations and assist with items that require weighing,

approve checks and identification cards, and deter shoplifters.

As the key security feature, the stations have a weight database, so they can

sense if an item has been bagged without authorization. Analysts say that

keeping lines short is key to enhancing customer service, a concept the

retailers are focusing on to gain a competitive edge and increase market share.

"This whole world is about convenience. Anything you can find that's

going to aid the consumer to get out of our stores, is going to be a big

opportunity for us," said Peter Lynch, president and chief operating

officer of food and drug retailer Albertson's Inc.

Life in the fast lane



For most customers, the new technology actually requires a little practice
before it actually speeds up the checkout process, some of the companies said.

During the learning curve, it can have the opposite effect of slowing things

down. "Companies' own research says it isn't necessarily faster. But people

perceive that they have more control, so it feels faster, and perception is

everything," said industry analyst Meredith Adler of Lehman Brothers.

Late last month, discount retailer Kmart Corp. said it was rolling out

self-service stations to about 600 stores, with 300 already in place. At some

Kmart stores, items processed through self-service are already accounting for

almost 40 percent of sales, the company said.

Other retailers including Wal-Mart Stores Inc., Safeway Inc. and Albertson's

are testing the systems in a handful of stores, but holding off on aggressive

roll out plans. Albertson's and Kroger say the systems tend to work best in

large stores in large markets, for customers with not-so-large orders.

Weighing options



Optimal Robotics Corp., the maker of U-Scan stations, claims that stores
recoup their initial investments in cost savings within 9 to 18 months of

installation. But some retailers are still debating whether the cost of the new

technology is justifiable.

NCR Corp., another maker of self-checkout stations, said it charges between

$20,000 and $30,000 per lane. "It's becoming more acceptable in the retail

environment but it's still very expensive," Wal-Mart's Tom Coughlin, chief

executive officer of the company's Wal-Mart stores division, said at the

company's annual meeting. Wal-Mart is testing in about 30 stores.

But Kmart and Kroger are confident that once the system gets humming, it will

alleviate the need for checkout staff, and thus enable stores to deploy sales

help in other ways. This amounts to a labor-cost advantage, and takes some

pressure out of the entry-level labor crunch stores have faced for several

years.

"With self-checkout, since there is only one clerk that oversees four

lanes, we don't have to hire four cashiers. We can reassign that staff to other

areas of the stores," Kroger's Rhodes said. In the United Kingdom,

superstores commonly offer hand-held scanners that enable customers to scan,

bag, and charge orders as they take items from the shelves, according to analyst

Meredith Adler.

"I think that would be a logical extension of our service offering to

the consumers. Don't be surprised to see us and other competitors there

someday," said Albertson's Peter Lynch. Whether American consumers would

prefer more assistance in the front or back of the store, more personal

attention or more personal control, what they have for now is more options.

(C) Reuters Limited 2001.