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Business
The End of Self-Checkout? Five Below, Target Scale Back on Self‑Service
By
Jake Beardslee
· July 6, 2024
In a significant shift, several major retailers are scaling back or eliminating self-checkout options in their stores. This move comes after years of investment in automated checkout technology.
Dollar General has removed self-checkout from approximately 12,000 locations, Business Insider
reported
. The company began this process in the first quarter of this year. Five Below is also
taking steps to remove self-checkout entirely
from what it terms its "highest-risk" locations. Target has announced plans to limit or eliminate self-checkout options in some stores, while Amazon is removing its "Just Walk Out" cashierless checkout system from its grocery stores.
Jim.henderson / Wikimedia
These decisions mark a reversal from previous strategies that emphasized the benefits of fully self-service stores. As recently as 2022, Dollar General
had praised self-checkout technology
for its potential to "enhance the convenience proposition, while enabling our associates to dedicate even more time to serving customers."
Keith C from Palm Bay, FL, United States / Wikimedia
The primary driver behind this shift appears to be concerns over "shrink," an industry term encompassing inventory loss due to various factors, including theft and errors.
Blake Wisz / Unsplash
Some retailers have explicitly cited theft as a reason for their decision. Five Below CEO Joel Anderson stated in March that replacing self-checkout options with employees was the most significant change in their theft reduction efforts, FOX Business
reported
. Similarly, Dollar General CEO Todd Vasos indicated in May that the company
aims to restrict self-checkout
to low-theft locations.
Phillip Pessar / Wikimedia
However, the issue is not straightforward. Claire Tassin, a retail and e-commerce analyst at Morning Consult,
told
NBC News that shrink at self-checkouts can be both intentional and accidental. "I know I'm not the only one who has struggled with a self-checkout machine," she said, adding that some customers may be "pretending to scan something and just bagging it anyway."
Mike Mozart from Funny YouTube, USA / Wikimedia
Consumer sentiment towards self-checkout is mixed. A LendingTree survey last year
found
that while 41% of consumers frequently use self-checkout when available, 21% feel it's like performing "free labor," and 14% view it as taking jobs from potential cashiers.
Christiann Koepke / Unsplash
Tassin suggests that improving customer experience may also be a factor in the retailers' decisions. "People are always complaining about the machines' being difficult to use, or loud, or just challenging in some way," she observed.
Phillip Pessar / Wikimedia
The move away from self-checkout may have positive implications for employment. Both Five Below and Dollar General have indicated plans to reinvest in their workforce as part of these changes. Tassin interprets this as a sign that "it is more profitable for the retailer to pay employees to manage checkout" than to support potentially inaccurate self-checkout systems.
Tyler A. McNeil / Wikimedia
Despite these shifts, self-checkout is not likely to disappear entirely. The Food Industry Association
reports
that 44% of transactions at grocery stores occurred via self-checkout lanes last year, up from 29% in 2022.
Mds08011 / Wikimedia