Controlling Self-scan Checkouts in Retailing

Keeping Customers Accurate and Honest

Time to consume: 4 min
10 Dec 2020

Reflections on Retail Loss | Professor Adrian Beck

The use of self-scan and checkout (SCO) technologies has grown considerably in the past 15 years, predominately, but not exclusively in the grocery sector, where customer and product volumes, and space utilisation issues, make them a particularly appealing proposition. For many retailers it has provided a significant opportunity to reduce their core costs at a time of increasing competition, and increasingly, there is now a growing appetite amongst certain groups of consumers who prefer this mode of shopping. However, a fundamental component of the SCO proposition is the transfer of responsibility for the accurate scanning of products and ensuring correct payment is made from staff employed by the retailer to the consumer. For many of those tasked with ensuring that retailers sell more products than they lose, this growing use of SCO systems has been viewed as a concern, not least in the difficulty in imposing strong enough controls over the way in which it may be used and abused.

Recent research published by the ECR Retail Loss Group looked in detail at some of the ways in which losses from SCO systems might best be managed, focused particularly upon the amplification of risk, how to enhance capacity to detect errant behavior, and minimizing product-driven errors. Outlined below are some of the approaches advocated in the report, focused particularly upon people, technologies, design and processes.

Utilizing Technologies

There are now a host of technologies becoming available to help manage SCO-related losses. These include Scan Verification Technologies – weight-based checking and video analysis of customer scanning behaviors. These are currently the most adopted types of technology being used by retailers. The former is the most established although opinions do vary on its applicability and reliability. The analyzing of customer scanning behavior is certainly growing in use – this seeks to identify, via video technologies and computer algorithms, when a user has not scanned an item properly. Another approach is Product Verification Technologies, which are being developed to try and tackle the issue of mis-scanning (customers mis-representing items). At the moment few retailers have adopted this technology at scale. A third type of technology is also increasingly being used – Payment Verification Technologies. These are focused on providing a way to restrict customers leaving the store unless they can prove they have paid (such as by scanning a receipt to open an exit gate).

Developing Good Design Practices:

Creating effective ways to amplify risk and enhance detection in the SCO environment – creating Zones of Control – is an important part of controlling SCO losses. This can be in the form of barrier controls, customer channeling and the location of SCO scan and checkout spaces within the overall store design. In addition, the use of video screens and signage can also be important components of good design to reduce the risk of SCO losses.

The Role of Guardianship

Most SCO scan and pay areas are supervised by one or members of staff. The ECR research found that they had a vital role to play in controlling SCO-related losses, but that it was often difficult to ensure compliance at store level – such as too few staff supervising too many SCO machines. A key factor is ensuring suitable, properly trained and motivated staff are deployed and that they are operating in an environment that facilitates rather than hinders their duties.

Creating Effective Processes:

When it comes to controlling losses associated with Scan and Go SCO technologies in particular, the role of good processes can also be very important. This includes: Robust User Identification (ensuring that retailers have a clear verifiable way of understanding who is registering to use the systems); Establishing User Expectations (only offering this facility to customers who clearly understood how it should be used); Delivering Credible Audits (utilising consumer behaviour-driven algorithms to select customers for an audit check); Utilizing Fixed Payment Points (only allowing payment at agreed locations in a store); Communicating with Users (making them aware of their SCO-related responsibilities as they shop); and Exit Control Strategies (having designated store exit points for SCO users).

Controlling Self-checkout Technologies in Retailing: An Emerging Landscape

While the recent report from the ECR Group has helped the industry to begin to fully understand the extent to which SCO technologies are generating retail losses, there is much work to be done in terms of developing our understanding on how they might most effectively be managed and controlled. Undoubtedly, like most good loss prevention approaches, it will require a multi-faceted approach that relies upon a mix of people, technologies, informed design, and the utilisation of good business processes. Sadly, there is no silver bullet – it will require joined up thinking underpinned by good data and informed analysis.