Asda ramps up self-checkouts and Tesco opens first self-checkout only store

November 1, 2009

Asda claims investment in self-checkouts across its estate has saved £10m in wages with a reduction in cost to sale of 1%. Tesco, meanwhile, has opened its first self-checkout only store. The Express store in King's Langley, Northampton, has a total of five self-scan tills, overseen by one staff member. There are no manned checkouts.

Asda is moving in favour of self-checkouts too. Its Pontefract store, for example, has five self-checkouts and three main bank tills.

Neil Applebee, head of process improvement at Asda, said the supermarket is also trialing self-checkout in food-to-go, to reduce queues at lunch time, freeing up the kiosks for Lottery and cigarettes.

In addition, Asda is piloting self-checkout conveyors in six stores, capable of serving up to 100 items. Staff will be deployed on self-checkouts at Christmas, however, to quicken sales.

Speaking at the Insight NACS Future of International Convenience Retailing event in London, Applebee said 23% of Asda’s transactions in the UK are self-checkout, equating to 3.8m customers a week.

“It’s been the fastest and most aggressive roll out and it’s now in 99% of stores,” he said.

Applebee told delegates the technology had transformed the business and store operations but the priority had been saving money first and dealing with queues second.

Applebee highlighted the advances in self-service technology.

“New technologies continue to shape the shopping experience of our customers and have opened up a range of skus we would never have been able to put inside the shop,” he said.

Applebee reported one third of Asda customers pay with plastic but it accounts for two thirds of sales. Forty per cent of petrol stations are fully automated, while Asda offers self-service restaurants and kiosks for digital processing, cake ordering plus its catalogue business, Asda Direct.

Applebee highlighted the growth in self-checkout globally:

The number of units is expected to increase from 92,600 today to 430,000 in five years’ time.

There are currently 74,000 units in North America and 15,000 in Europe, of which, 9,500 are in Asda. There are a further 3,000 in Asia.

Applebee reported the results of research into consumer acceptance of the technology conducted in July 2009, five years since Asda launched self-checkout.

It shows 54% of shoppers have used self-checkout in supermarkets. Fifty two per cent of non-users are unlikely to ever use the technology but 92% of users are highly satisfied. Thirty two per cent need help and 80% think the volume of self-checkouts is right. A quarter would be happy with 100% self-service and 52% are happy with self-service in food-to-go. Applebee highlighted further benefits: no internal theft and less cash handling but revealed it had changed the way colleagues work in store.

As a result, Asda is creating self-service checkout hosts in store and is releasing a training video for colleagues. “Customers just want a bit of assistance,” said Applebee. “They just want to be shown how to use it.”

Applebee added there was no evidence to suggest there was incremental shrinkage from self-checkout.

“Ten per cent of shrinkage is internally administered and we are training our hosts to be vigilant plus we have weighted scales on the bagging area, which stops different weights being put through.”

Applebee emphasised the growth in uptake.

“One in four customers uses them – the numbers have increased from 2.2m customers to 3.8m per week.”

Combined with other self-service areas in the store, the technology now represents 30% of sales, he said.

Applebee said the future pointed to further self-service technologies such as kiosks.

“There is a rising trend of self-service,” he said. “There is nothing more frustrating than waiting 10-deep in a queue at 8pm at night when all you want is a pint of milk.”