Walmart, Costco and Others Rethink Self-Checkout

The problem is significant shrink, more than double what it would be without self-checkout.

November 14, 2023

Stores are beginning to step back from self-checkout technology following the boom it received due to the pandemic, reported CNN. Walmart, Costco and other supermarket chains are adjusting their self-checkout strategies after reporting that self-checkout leads to higher merchandise losses from customer errors and intentional shoplifting.

Last year, Wegmans ended a mobile app program that allowed customers to scan, bag and pay for groceries while shopping. Costco plans to add more staff to its self-checkout areas because non-members were found to be sneaking in and using membership cards that didn’t belong to them. Costco management said this year that shrink increased “due to the rollout of self-checkout,” according to CNN.

Walmart removed self-checkout in some New Mexico stores, while ShopRite pulled the technology from a Delaware location following complaints.

According to CNN, “One study of retailers in the United States, Britain and other European countries found that companies with self-checkout lanes and apps had a loss rate of about 4%, more than double the industry average.”

Some of the shrink caused by self-checkout lanes is due to customer error. Some items, such as fruit and meat, need to be weighed and entered into the system manually, but customers may enter the wrong code by accident. Other times, shoppers may not hear the beep that confirms an item has been scanned.

Other customers intentionally steal using the checkout lanes. Various common tactics include not scanning an item, swapping a cheaper item (bananas) for a more expensive one (steak), scanning counterfeit barcodes or properly scanning everything and then walking out without paying.

According to national crime statistics released by the FBI, robbery increased 1.3% across the country in 2022. The FBI also reported that convenience stores and gas stations, combined, were the site of 13.8% of robberies in 2022.

To continue developing and sharing important resources for retailers, NACS is currently fielding an industry-wide crime and loss prevention survey. By participating in the survey, retailers can assist NACS in quantifying critical industry-specific challenges to help prioritize and guide strategic actions to address these challenges.

“We’re asking all convenience and fuels retailers to provide us with their input on how crime is impacting their operations,” said Lori Stillman, vice president of research and education at NACS. “As we assemble an industry-wide working group to address the most pressing needs of our members, these data will be invaluable to our efforts.”