Self-Checkout Systems Get More Hands-On

A Jewel-Osco supermarket in Barrington, Ill., is serving as a laboratory for technology that could change the way Americans shop for groceries.

Shoppers swipe their customer-loyalty cards into a kiosk that dispenses a handheld scanner, then scan and bag groceries as they move down the aisles. When done, the shoppers enter an unstaffed checkout lane where they swipe their card and pay for the groceries, often never interacting with store personnel. "It's a very fast pass-through experience," says Bill Bishop, a retail consultant who lives in Barrington and has made that Jewel-Osco his primary grocery store. "Once people experience it, they're going to like it."

Albertsons Inc., Jewel-Osco's parent company, won't comment on the test. Nor will NCR Corp. and Symbol Technologies Inc., developers of the systems, other than to confirm that a large grocery chain is testing them and plans a bigger pilot. Nevertheless, this test is an example of how self-checkout is starting to change the way people shop, not just how they pay.

NCR and Symbol disclosed last week that they're marketing a self-service system that uses Symbol's handheld device and NCR FastLane, a self-checkout system already used by several U.S. chains. The Symbol device displays purchase information to shoppers and the purchases are transmitted to the store's cashier system via a wireless network.

This goes beyond the original self-checkout systems, which have been growing in popularity but essentially let shoppers do only what a cashier would do. The Food Marketing Institute issued a report last week showing that 24% of retailers, mostly grocery chains, are implementing self-checkout, up from 19% last year. In 1999, only 6% were using it.

Fujitsu Ltd. jumped into the fray last week, announcing it's developing a self-checkout system based on Optimal Robotics Corp. technologies. Many stores promote self-checkout in "15 items or less" express lanes, but Optimal demonstrated at the MarkeTechnics trade show a configuration allowing more items per customer. PSC Inc. introduced self-checkout that can handle personal checks and uses voice prompts and illustrated instructions.

Shaw's Supermarkets Inc. plans to expand NCR self-checkout systems from 52 stores to 120 this year. "The more of these we put in, the more customers flock to them and tell us they like them," says Paul Francis, Shaw's senior manager of security and front-end systems. Customer use of the systems ranges from 8% to 23%, depending on the store.

Supermarkets tend to emphasize the speed of self-checkout, but it's more valuable than that. NCR says a typical configuration of four systems costs about $100,000 per store and pays for itself in about 12 to 18 months through lower labor costs for checkers and baggers.

The timing isn't right for handheld scanners at Shaw's. Wireless networks and security standards need to improve before Shaw's would be ready, Francis says. Shaw's is looking to test expanded self-bagging areas that support self-checkout for customers with a larger number of items.