The Return of Human Interaction: Cashiers to Replace Self-Checkouts?

by Edwin Benson February 17, 2025 tfp.org/the-return-of-human-interaction-cashiers-to-replace-self-checkouts/

If there is a single symbol of how retailing has changed over the years, it is the self-service checkout terminal. Fortunately, this innovation may be fading from the scene.

Great Expectations…

A Kroger grocery store in Deerfield Beach, Florida, is credited with the first use of such a device in July 1986. From the retailers’ point of view, such devices offered two primary advantages. First, they promised to speed up transaction time both for the store and the customer. The stores could funnel more customers in and out, and customers could shave precious minutes from the time it took to pick up a few items.

However, from the store owners’ point of view, the second advantage was far more important. The machines would save labor costs and limit issues with employees. The machines were always ready to wait on customers, never needed breaks, could be counted on to be there on time, and would never upset the entire schedule by getting sick. Perhaps most important, they didn’t collect an hourly wage.

The downside was that many customers had adverse reactions. However, many retailers believed people would grow accustomed to the machines—even if grudgingly.

…Doomed to Disappointment

Almost forty years later, many stores now understand that the machines have not lived up to their early promise.

From the customers’ perspective, the machines are just part of the dehumanization of life. As the number of people living alone increases, the experience of shopping is one of the few times that these people have any human interaction. Even though the interchanges are brief, they are opportunities to be pampered just a little bit. The smiling cashier, ready to assist, is a pleasant prospect. If questions or problems arise, a courteous and knowledgeable employee can make the customer feel that the company appreciates them.

On the other hand, machines just stand there. The only noises they make are inhuman buzzers and beeps. Their flashing screens make demands. If a customer moves too slowly, the machine registers its disapproval. In short, the customer feels like an unappreciated store employee.

Customers’ Reasonable Expectations

Patrons expect the store to serve their needs. Businesses should not be surprised if the clientele resents the inverted relationship. One source estimates that roughly thirty percent of all customers deliberately avoid self-checkout stations, preferring the human cashier, even if it involves waiting in line. If there is no human option, these customers may take their business elsewhere.

Such resentment is also a problem from the retailer’s perspective, which is why such terminals are seldom seen in higher-end retailers. Their customers demand service, and such emporiums are foolish to chase them away.

Dollar General’s Experience

However, the scanners are often found in grocery and discount stores. CNN Business examined the experience of one low-price retailer, Dollar General.

In 2022, the chain experimented with 200 of its then-18,000+ locations. In these outlets, management replaced all cashiers with self-checkout stations. Chief Operating Officer Jeff Owen said store associates could still assist customers checking out, but their main duties would lie in other tasks.

The discount retailer also had the stations as an option in 8,000 stores, which planned to increase to 11,000 by the end of 2022.

Had the number of cashier-less locations been successful, management would have rolled out to many other stores. However, that day never arrived. By the end of 2023, company Chief Executive Officer Todd Vasos told shareholders, “We had started to rely too much this year on self-checkout in our stores. We should be using self-checkout as a secondary checkout vehicle, not a primary.”

Shrinkage

Most likely, part of Dollar General’s problem had to do with shoplifting, often euphemistically referred to in the business press as ‘shrinkage.” Most companies, for good reason, are reluctant to publish detailed figures, at least in part because they don’t want to inspire other would-be shoplifters. However, a 2016 New York Times article referred to a study that looked at the experiences of stores in the U.S., Great Britain and Europe.

“Professor Adrian Beck and Matt Hopkins of the University of Leicester in England said the use of self-service lanes and smartphone apps to make purchases generated a loss rate of nearly 4 percent, more than double the average.” (Emphasis added.) In the low mark-up world of discount and grocery retailing, that extra two percent loss is a huge problem.

However substantial shrinkage may be, it is not the only issue retailers have with self-checkout terminals.

Higher-Than-Expected Expense

The next most important issue is cost. The initial price for each station ranges from $10,000 to $25,000, depending on the individual machine’s features. However, that is only the beginning. Maintenance is always an issue, as with any machine in constant use. Also, the software that runs the machine needs to be updated regularly. Cybersecurity is a constant concern. These tasks must be done by highly trained professionals who charge far more than the usual cashier’s wages.

Another problem is the constant need for human intervention. One grocery store frequented by this author illustrates this. This store has six terminals in a sort of cluster. A store employee is always stationed there. That person’s task is to watch for shoplifters and assist customers who cannot operate the machines. This is a common issue, for many customers can’t read or understand the instructions and numbers on the machine. Often, providing that assistance takes longer than for a cashier to “ring up” that customer’s purchases. Of course, the time the employee has to spend focused on that one customer increases the chances that other customers will slip a few items into their bags without paying for them.

Mistaken Assumptions

Another issue is occasionally referred to as “The Doorman Fallacy.” The name relates to British hotels that discovered the unintended consequences of removing their doormen. The consequences also apply to the absence of cashiers. The fallacy lies in assuming that the employees only do those tasks mentioned in their titles. However, a store cashier does much more than simply ring up purchases and make change. They also greet the customers. They keep their stations clean. They keep the customers moving through the line. They solve minor problems related to the price of the merchandise. They answer customer’s questions—or find a supervisor who can answer them.

These are all essential tasks, ones that customers expect store management to handle. Machines cannot accomplish these functions.

It would be nice to say that the self-checkout terminal is going the way of the dodo, but that would be claiming too much. The technology exists and works well enough that some store operators will find it attractive. At the same time, it is reassuring that the friendly, smiling store cashier or clerk is not doomed to the ash heap of history.