Bearing in mind the fact that Tesco has invested heavily in self-checkout technology for its retail stores, going so far as completely replacing cashiers with self-checkout at its Tesco Express stores in the UK, it is more than apparent that there is a plurality of benefits ascribed to the deployment of the self-checkout system for both Tesco as a retailer and its customers.
Reduced Labor Costs
In the retail industry, one of the largest expenditures is typically the cost of labor.
Utilizing a self-checkout system offer substantial savings in employee costs because it ideally eliminates the need for an operator to handle the checkout terminal as it allows the customer to execute most of the checkout tasks, without help from an attendant. And typically, only one employee can monitor several self-checkout kiosks simultaneously. It can be particularly beneficial during slow times when few to no customers are checking out, and cashiers aren’t completing any tasks and are essentially being paid for nothing. This means lower operation expenses which can correlate to an increase in profits, while still providing customers with the service they need. (Finne and Sivonen, 2009)
Improved Space Utilization
With self-checkout machines being significantly smaller than a traditional checkout manned by a cashier, retailer can add more self-checkout units without sacrificing merchandising space. In fact, multiple self-checkout kiosks can be placed into a relatively small area that could only fit few to none standard checkout units, this is turn yield up to an improvement in space utilization as it helps stores reclaim valuable floor space that could be used for more shelves, display cabinets or additional checkouts. (Collier and Kimes, 2013)
Fresh shopping experience
There is a tectonic shift in consumer buying habits and expectations. Most consumers nowadays have an open mind set; they are also technology savvy and are more than willing to try new things and experiment with different technologies.
The self-checkout system, be it a more or less new technology that is not commonly seen in most countries, helps create a modern and fresh shopping experience for Tesco’s customers. According to Vivek et al (2012), the interaction with the technology also leads to a high sense of fun and entertainment since it can be engaging.
Fernandes et al (2017) claim that the upside of the self-checkout system is the idea of control—namely, control of the pace of the transaction, the level of desired interactivity, the handling and packaging, and ultimately the output of the service— thus perceiving autonomy.
Self-checkout system allows consumers to take charge of their whole shopping experience from selecting their product to final purchasing. Performing the service by themselves makes customers feel more in control. In this context, the self-checkout system seems to be empowering.
Efficiency and Speed of Checkout
The system helps facilitate a faster checkout experience for the consumer. Rather than dealing with long checkout lines that get backed up by customers waiting to pay, people can quickly make purchases by ringing up items themselves. This can be especially helpful during peak sales times when stores experience rushes with a large influx of customers.
The time of queuing and the time of undertaking a transaction at the checkout counter weighs heavily on consumer satisfaction from the overall shopping experience. Long lines could ruin the entire shopping experience. Thus, reducing customer waiting time at self-service counters not only improves the focal customer’s shopping experience but also influences the service quality perceived by other customers. (Nallapureddy et al., 2015)
Finne, S., & Sivonen, H. (2009). The Retail Value Chain: How to Gain Competitive Advantage through Efficient Consumer Response (ECR) Strategies (1st ed.). London: Kogan Page. Retrieved from http://danangtimes.vn/Portals/0/Docs/6782931-56_The Retail Value Chain.pdf
Collier, J. E., & Kimes, S. E. (2013). Only If It Is Convenient: Understanding How Convenience Influences Self-Service Technology Evaluation. Journal of Service Research, 16(1), 39–51. https://doi.org/10.1177/1094670512458454
Vivek, S. D., Beatty, S. E., & Morgan, R. M. (2012). Customer Engagement: Exploring Customer Relationships Beyond Purchase. The Journal of Marketing Theory and Practice, 20(2), 122–146. https://doi.org/10.2753/MTP1069-6679200201
Fernandes, T., & Pedroso, R. (2017). The effect of self-checkout quality on customer satisfaction and repatronage in a retail context. Service Business, 11(1), 69–92. https://doi.org/10.1007/s11628-016-0302-9
Nallapureddy, B., Das, P., Nagaraj, N., Parameswaran, S., & Zaninovich, J. (2015). Future of Self-Checkout: A landscape study.