20 Years On: The Dramatic Metamorphosis of Point-of-Sale Systems

The re-shaping of point-of-sale systems is likely to include significant changes in the coming years.

point-of-sale systems

Emerging point-of-sale systems technology, including self-checkout, was on full display at the annual National Retail Federation (NRF) conference in January. Among the companies showcasing advances was NCR Corporation, which was also celebrating 20 years since the installation of its first self-checkout solution.

At the show, NCR introduced its new vision-based scanners—replacing weight-based security systems—and biometric age verification for age-restricted products. Intelligent image scanners recognize items placed on the scanner. By offering a short list of suggestions instead of requiring customers to move through menus on the interface, shoppers can more quickly and easily scan non-barcoded items, such as fresh fruits and vegetables.

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The same technology is expected to help retailers reduce shrink due to “item swapping” theft, says NCR. For example, if a shopper tries to place an expensive item, like a bottle of wine, on the scanner while entering a code to weigh it as less-expensive item, like a bunch of bananas, the error is detected and the system alerts staff to intervene.

Other innovations include NCR FastLane™ Mobile Shopper, which aims to help retailers digitally engage with shoppers on their mobile devices, with tools to build shopping lists and locate and scan items for fast checkout inside the store. “For many retailers, self-checkout has become the starting point of their transformational journey to thrive today and prepare for the demands of tomorrow,” said Tom Chittenden, vice president and general manager of retail solutions at NCR Corporation.

Kroger is one of the companies aggressively reshaping traditional checkout, announcing that it will roll out the chain’s “Scan, Bag, Go” system at 400 stores in 2018. The system will allow shoppers to scan bar codes of items they want to buy with a hand-held scanner provided by Kroger or via its “Scan, Bag, Go” smartphone app. The technology keeps a running tab of shoppers’ order, including applicable coupons, and shoppers then pay at a self-checkout register as they exit. Soon, the company plans to allow shoppers to pay through its app, eliminating register checkout altogether.

The re-shaping of retail checkout and payment could be even more dramatic in the next ten years than in self-checkout’s first two decades, suggests real estate service company CBRE in a new research report, “Future of Retail 2030,” which examines forty ways in which the world of retail will change. The company predicts that in-store checkout desk will be replaced by faster, cashless ways to pay.

“Many retailers have already taken away the physical checkout desk. This is likely to continue as technology plays an increasingly important role as an enabler of retail sales. Technology will have an impact on the human aspect of retail. The number of retail assistants required in this part of the customer’s in-store experience will decrease as transactions occur at the tap of a screen.”

In addition to potential labor savings from checkout automation, retailers that use new checkout options may realize an increase in customer satisfaction. Although novelty was certainly one driving force, the line that circled the block at the opening of Amazon Go, the company’s cashier-less grocery store in Seattle, suggests that some customers are eager to embrace new retail payment options.

In an NCR-conducted review of retailer and customer experience using self-checkout solutions, 54 percent of retailers reported an increase in throughput and 76 percent reported improved service with shorter, speedier checkouts. At these retailers, 31 percent now have more than half their baskets going through self-checkout.

In a study presented at a 2017 conference on business innovations, mobile self-checkout solutions were found to provide a more time efficient shopping experience, particularly when stores are crowded. “We show that the time performance of app users is independent of store rush and that the time for a transaction is significantly lower for app users compared to regular shoppers during peak periods,” concluded the study, “From Shopping Aids to Fully Autonomous Mobile Self-checkouts—A Field Study in Retail.”

Finally, self-checkout also appears to help retailers build customer loyalty, according to a study published in the March 2017 issue of Service Business, “The effect of self-checkout quality on customer satisfaction and repatronage in a retail context.” Said researchers, “We conclude that successful use of self-checkout may “tie” consumers to a provider, representing a feature that differentiates a retailer from competitors.

Of course, it’s up to loss prevention to evaluate the risks and identify possible preventive strategies associated with point-of-sale systems technology such as self-checkout, mobile coupons, touchless payment, mobile POS, and mobile self-checkout.

In a 2016 study by Martin Gill, “Retail Loss Prevention in Perspective,” practitioners suggested they are struggling with aspects of new technology, particularly with the speed of deployments. “The different mechanisms for selling goods, primarily multi-channel retailing including the mobile point-of-sale systems but also self-checkouts, were seen as having a major impact on retailing and also retail loss,” according to the report. “This generated a number of specific concerns including the range and complexity of technologies being used (which are sometimes rolled out rapidly) and being able to keep abreast of the risks inherent in their use.”

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