In the Baltic states self-checkouts are quickly becoming the dominant way of shopping. Fast, frictionless and secure self-checkout gives a competitive advantage for any retailer.
If you are planning to add or improve a self-checkout zone at your store, here are a few things you should know.
How much does a self-checkout cost?
Self-checkout technology has reached maturity. Their prices are falling rapidly. A self-checkout for non-food items can now be purchased for as little as €2,000. A supermarket checkout costs between €5,000-7,000 and €12,000-14,000 (with cash functionality).
Due to the rounding of small denomination cent coins, the number of coin denominations has decreased, which will also reduce the price of self-checkout cash registers.
In Lithuania, Partner Tech Europe, together with Neto Baltic, has started offering a self-checkout rental service (self-checkout as a service). Retailers are provided with advanced self-checkout cash registers (with full maintenance and service) for a fixed monthly fee, without any initial investment. This means that the self-checkout area pays for itself from the first month of use, as operating such an area will cost less than the labor costs for traditional checkouts.
How to protect self-checkout from losses?
Artificial intelligence is becoming an important tool for reducing losses. Traditional weight control in the self-checkout area alone is not enough.
A video camera installed in the self- checkout allows the image of the scanned product to be compared with the database. This protects against scanning more expensive items as cheaper ones and swapping barcodes. Artificial intelligence also protects against fraud scenarios where not all items are scanned, items are left in the basket, or the buyer tries to leave the checkout area without paying. Artificial intelligence is integrated into the store’s video surveillance and security system, so store security staff can respond immediately to cases of fraud.
The use of the Crime Predictor solution, developed by Neto Baltic and its partners since 2019, has shown in practice that losses at the self-checkouts can be lower than in traditional checkouts.
How to reduce self-checkout interventions?
Interventions – when a customer needs assistance from a store employee – are the biggest obstacle for fast and frictionless checkout experience. Not only do they spoil the customer experience, but they also reduce the profitability of SCOs. At some retailers the intervention rate can be as high as 20%, meaning every fifth customer will require employee assistance!
The main reasons for interventions are:
- Discrepancies in product weight (46%). These can be resolved with a centralized, self-learning weight database. For example, if the weight of a product has changed (from 100 g to 90 g) but the barcode has remained the same, this discrepancy can be quickly identified and corrected at the retail chain level, without leaving this “burden” to be solved by each store individually.
- Age verification (39%). First of all, modern software allows this to be done remotely, via a video camera installed at the checkout. Artificial intelligence is increasingly being used to verify age. For example, artificial intelligence automatically confirms the age of shoppers with a safe margin—when the shopper is clearly over 30 years old. This solution is more than 99% accurate.
Calling a shop assistant takes 27 seconds on average. By reducing interventions to 2-3%, the profitability of a single SCO increases by €258 per hour.
How to improve self-checkout speed?
60% of shoppers have at least one unpackaged item in their shopping cart – fruit, vegetables or baked goods. Artificial intelligence helps to automatically identify such items without having to search for them manually in the product menu. The Picklist Assistant tool, developed by Neto Baltic and its partners, reduces the scanning time for unpackaged goods from 10 to 3 seconds. We have compared that when the AI Picklist solution is installed at the checkout, the checkout with AI serves 6-10 more customers per hour, and the revenue is €210/hour higher.
AI cannot recognize baked goods that are visually similar or placed in paper bags. Therefore, it is important to have a user-friendly product menu tool where the most popular products in that store are displayed at the top of the menu. The list of the most popular products for each store or region can be easily compiled manually. All Picklist menus are easily managed through a centralized retail chain self-checkout management system.
How to improve self-checkout management?
Retailers are beginning to view self-service checkouts as a separate sell-through channel. They are managed centrally across the entire retail chain by a dedicated team. We are not just talking about real-time monitoring of the status of the checkouts – whether they are working, whether software updates are needed, or whether they are generating an unexpectedly high number of interventions.
The software provides real-time access to important business intelligence information:
- Get detailed reports on a specific SCO in a store or all SCOs installed in that store (cart size, number of interventions, number of transactions, etc.).
- Monitor the average duration of an intervention (how long it took for a store employee to resolve it) and compare it with other stores in the chain. This allows you to introduce common intervention response standards for the chain, plan the need for additional checkout area staff, and improve service in problem stores.
- Broadcast advertising messages at the checkout. Adapt them to each store.
- Introduce extra languages to the checkout menu in stores in certain regions, change the checkout user interface, and create individual Picklist menus for individual stores depending on their assortment.
- Set performance KPIs for stores and evaluate their progress in achieving them.
SCO hardware performance depends on SCO software
Whereas previously the focus was on SCO hardware, now SCO software gets all the attention.
Many retailers have previously installed self-service checkouts and are seeking to correct the limitations and problems of this legacy hardware through better software.
Otter SCO self-checkout software is developed in Lithuania and implemented worldwide by Partner Tech. In the Baltic states it is distributed by Neto Baltic. It can be installed on existing self-service checkouts from various manufacturers (supported by about 90% of hardware). This protects retailers’ investments, as there is no need to replace checkout hardware in order to achieve more efficient SCO operation.
