Dollar General $DG says it’s yanking a bunch of self-checkout kiosks from its stores because an AI says that people are using them to steal. Target $TGT is rolling out a self-checkout express lane that limits customers to 10 items because self-checkout lines are too long. Maybe the self-checkout nightmare, in which customers fumble frustratingly with weird machines instead of going to cashiers who know how to operate a company’s point-of-sale (POS) system, is coming to an end.
But maybe it isn’t! Just last week, Ross Stores $ROST said on its earnings call that it’s piloting self-checkout in all of its locations. When Kohl’s gave investors a business update on Tuesday, it said it was going to expand its self-checkout system. What gives!
Maybe it comes down to trust. Some retailers think their customers will jump at the first chance to swipe stuff, and some don’t. At a Citi real estate conference the other week, Brixmore Property Group CEO Jim Taylor got a question about whether retailers like the ones who rent space in his company’s shopping centers are dealing with the kinds of self-checkout problems that have dominated headlines.
“I think that’s going to be in very specific markets where you have more crime and more of those issues, generally not the markets that we’re in where we’re not seeing quite that level of shrink experience from our tenants,” he said. Many of Brixmore’s shopping centers are in tony suburbs like Chicago-adjacent Oak Park, Illinois and Sugar Land, Texas, near Houston. Wink-wink, nudge-nudge.
Overall, the self-checkout craze does seem to be waning. POS specialist ScanSource CEO Mike Baur recently said his company’s POS customers have grown cooler towards the technology. “We still believe that, for us, it’s an area that we expect to continue to have point-of-sale, self-checkout opportunities, but they’re going to be smaller,” he said on a recent earnings call. “The larger retailers acted first. And what we’re seeing now is the price points and the customers are smaller than they were in the prior year.”
But given that Axios reports that 43% of U.S. consumers like self-checkout better than the cashier route, so it’s unlikely that America’s retailers will do a full return to tradition, as much as it pains them not to.