How do self-checkout terminals work?
First things first: How do self-checkouts, or in short “SCO”, work?
In their basic idea, most self-checkout systems are quite similar, there are two alternatives.
Stationary self-checkout terminals
Option 1 is where the customer comes to the terminal and the individual items are scanned either manually or automatically. This version is the so-called “stationary self-checkout”.
In option 2, the customer scans his items himself before coming to the terminal. This is done using a smartphone or hand scanner. At the checkout, all the customer has to do is pay.
How do self-checkouts recognize the articles?
The articles can be recognized in three different ways.
By hand scanner
The most common way, especially in supermarkets, is to identify the articles using hand scanners to read the barcodes. In retail, this system has the advantage that the necessary infrastructure is already in place and the effort required to upgrade to a self-checkout is limited to the hardware. However, only items with a barcode can be scanned quickly, all others have to be looked up manually.
With the help of RFID tags
Another method of recognition is a self-checkout with the help of RFID tags. One of these tags is attached to each item and then automatically read by the self-checkout terminal. This process speeds up the payment process enormously, as there is no longer any need to scan an item by hand. However, the use of RFID tags is quite costly to implement, as it must be ensured that all items are fitted with such tags.
The supplier of sporting goods Decathlon, for example, has been able to implement RFID tags because its product range consists almost exclusively of its own brand. For supermarkets or kiosks, however, this is more difficult to achieve.
Using AI-based visual recognition
A third option is visual recognition of items using AI. Customers must place their items under a camera, and an intelligent algorithm then recognizes what is in the image. This system is just as fast as RFID tags, as the items are also recognized autonomously. This type of self-checkout is particularly well suited for kiosks or eateries with freshly prepared meals. This is because a large proportion of the items are served on plates that are not marked with either RFID tags or barcodes.
As you can see, there is no such thing as “one size fits all” when it comes to self-checkouts. But why do companies still take the time to decide on a suitable self-checkout system?
Why do companies use self-checkouts?
The potential of self-checkout terminals is quite obvious.
1. Shorter waiting times for customers, as there is room for several checkouts. Additionally, they can be open at the same time, regardless of how much staff you have available.
2. Flexible staff deployment, because at peak times not all your staff is tied up at the checkout. Staff can be deployed where they are most valuable.
3. The image of the operator should not be ignored either. In a competitive environment, it is important not to be seen as outdated and to offer customers the most pleasant experience possible. Self-checkouts ensure this innovative image.
What advantages do self-checkouts offer?
At the same time, your customers can pay faster because more checkout stations are available.. This naturally has an impact on the satisfaction of your customers.. Additionally busy locations also show increased sales numbers when queues decrease due to the use of self-checkouts.
In addition, the use of self-checkouts can also have a positive effect on your recruiting. After all, an “innovative work environment” shouldn’t just appear as a catchphrase in job postings. By using new technologies, you bring your promises to life and offer your employees interesting and modern fields of activity.
What disadvantages do SCO have?
Where there is light, there is also shadow. It’ s like that with everything. On the one hand, you will most likely have employees who are initially suspicious of new technologies. In this case, good change management is a must to bring these employees on board and to shape the digitalization process together. Many people persist in accusing self-service checkouts of taking away people’s jobs. To counteract this, it does not help to only talk them down.
Another accusation against self-checkouts is that they practically invite people to steal. The EHI Retail Institute has published a study on this that shows the opposite. The study proves that in 85% of all observed stores, no increased inventory discrepancies were found. Self-checkouts are often installed together with additional security measures to prevent theft. You will find out which measures these can be in the next section.
What actions help to prevent theft at self-checkouts?
One of the most efficient measures against theft at the SCO is the use of service staff. In this case, one operator is responsible for supervising 4-6 cash registers and randomly checks the purchased goods. Certainly, it does not make sense to check every single receipt. But the awareness of someone checking keeps many customers from trying to steal (part of) their purchase.
To support this, a “stop” and “go” system with green and red lights can be attached to the self-checkouts themselves to indicate open payment transactions and point out problems. This speeds up the process and makes your employees’ work easier. In addition, gates can be installed at the exits to randomly check customers. However, it is important that the measures are appropriate and do not cancel out the benefits achieved by self-checkouts.
An additional option is to monitor the checkouts centrally so anomalies can be identified more quickly. Operators can then view the individual shopping carts and thus react better. With image-based self-checkouts, there is an additional advantage: with the help of the pictures taken of each item, management can perform visual quality control.
What are the requirements for self-checkouts?
The requirements you have to meet in order to use a self-checkout in your operation depend on the circumstances that apply to your business and the type of self-checkout you decide on. Everything is possible, from expensive conversions to elegant tabletop versions. A decisive factor is what type of business you are.
In supermarkets, upgrading to self-checkouts often involves major conversion work. It is therefore advisable to tackle the changeover in combination with large-scale modernization measures.
Restaurants and company catering
In restaurants, especially company restaurants or kiosks, image-based self-checkouts are usually used. These devices are very easy to retrofit and only require little space along the tray slide.
How much does a self-service checkout cost?
The prices for self-checkouts vary, depending on the type of solutions implemented. To give you some guidance, here are a few examples of such models.
You buy the SCO including the POS system and pay "only" for upcoming updates
The initial costs are most manageable with this system. However, over time, you run the risk of either spending an unexpected amount of money on your self-checkout or working with outdated systems. Especially in such a fast-growing field such as self-checkouts, this can be your downfall. Therefore, this type of pricing is rather outdated and is hardly used anymore.
You convert your existing POS system to a SCO
If you are already satisfied with your existing POS system, there is no reason for a change. Most self-service checkouts can be retrofitted without much effort. In this case, it is important that you ensure compatibility between the SCO and the POS system and that you are in good communication with both partners. The disadvantage of this solution is that you do not necessarily have a central contact person. In addition, the purchase of two different systems can end up being somewhat more expensive than the complete package.
You rent the SCO together with the POS system, updates are included
In this case you combine the advantages of the first two options. You rent both systems “as a service”, all updates and services are included in your subscription. This way you are 100% sure that the POS system and SCO work well together, you have a central contact person for all issues and always stay up to date.
The most important facts
Shorter queuing times, flexible staff deployment and a modern image are the main reasons for using self-checkouts.
In the catering industry, upgrading to a self-checkout is easy. Elegant tabletop models merely need a small space on the countertop and electricity.
To implement a self-checkout, you don’t have to change your POS system. Most self-checkout providers are compatible with many POS systems.
Theft is not an increased problem at self-checkouts, that is statistically proven. Additional security measures can further prevent theft.