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IXR: Innovation Expanding Retail
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Why self-checkouts are attractive to shoppers and profitable for retailers

The triple benefits of self-checkouts: effects for retail, consumers and society

In 2020, people around the world made purchases worth more than $ 28 billion through self-service. In five years, it will grow almost 2.5 times. Buyers, including Russian ones, like this format. However, previously the widespread introduction of self-service checkouts (CSR) was hampered by the high cost. With the advent of domestic analogues, this barrier has disappeared, and the technology can manifest itself in all its advantages. Consider its effects on three stakeholders - business, customers, and society as a whole.

Despite the explosive growth of online shopping, the vast majority [1] of shoppers prefer to purchase goods, especially groceries, from physical stores. At the same time, 60% note that long queues at the checkout irritate them.

The self-service system largely solves the problem of dissatisfied customers. Surveys show that about 75% of supermarket customers are eager to use automated solutions if it saves them time. This is especially true of millennials, 91% of whom are CSR-like.

Despite the fact that there are already examples of full self-service stores in the world like Pyaterochka on the Fly or Amazon Go, it must be admitted that this format will not soon become widespread. Today, it is more relevant to combine self-service systems in shopping areas, which brings multiple benefits.

Benefits for retail chains

Reduced costs. The effect is achieved, firstly, by saving space: on the area of one classic checkout, from 2 to 4 KSO can be located. This, in turn, means that more square meters are freed up for displaying goods or advertising. Secondly, the introduction of self-service systems can reduce the number of employees.

Increase in store throughput. The experience of implementing IXR cash registers in Russian retail shows that after the installation of CSR traffic increases up to 10%.

Increased sales. The influx of additional traffic to the self-service store, which is driven by the ability for shoppers to make a quick purchase (especially during peak hours), leads to an increase in the retailer's revenue. In other words, CSR gives a competitive advantage and draws the audience away from neighboring stores and shops with queues, as well as partly from public catering.

Suppression of theft. It has been proven that up to 90% of all thefts in stores occur either in collusion with the staff or the employees themselves. According to market experts, the CSR zone is one of the most inconvenient places for theft.

It should be noted that the cost of introducing CSR in Russia, while maintaining all the effects, is getting cheaper due to the emergence of import substitution solutions. Thus, serial production of one IXR cash register is 4 times cheaper than counterparts from third-party manufacturers. And the operating cost is estimated about 5 times lower than when using similar solutions.

Positive aspects for the buyer

Save time: This is especially important on weekdays when shopping is on the go. 85% of customers say that self-service is faster than buying through a cashier.

Reducing the likelihood of body kit or shortcuts. Despite the fact that the time of widespread "market deception" has long passed, there are still tricks of how to add a dozen extra grams to the product, and buyers know about it. That is why it will be more comfortable for many of them to check everything with their own hands.

Reducing emotional stress by reducing contact with the cashier and other customers. Many people feel uncomfortable seeing a long line behind them. For example, in the West, this is why every second customer uses the self-service option at every opportunity. The factor of anonymity also works: no one sees what a person has in the grocery basket.

Social impact

Distancing is a new trend in modern society. Despite the fact that in most countries of the world, restrictions associated with the emergence of coronavirus are gradually being lifted, people still fear close contacts. Self-checkout counters allow for greater security for shoppers. For example, a Shekel survey shows that 87% of respondents prefer to shop at retail stores with contactless or secure self-service options.

The trend of social distancing may persist as part of a social norm beyond the end of the pandemic. Three quarters of McKinsey survey respondents do not plan to change new habits, regardless of the removal of all restrictions. This means that society will develop more acceptance towards contactless systems and encourage those who implement them.