Monday, September 19, 2011

Albertson Removes Its Self Service Cash desks

Albertson is a large US grocery retailer, located especially in the Southern and Western part of the country. I actually visited quite a while these stores as I used to live nearby one of them when I was living in the US.

Albertson set up some self service checkout lanes in its stores as most of the chains in the US. The goal is simple: one of the largest expenses line of a retailer is its wages, and one of the activity which needs the most of one workforce time is the cash desk one.

Hence a lot of retailers, especially in France where the workforce cost a lot, decided to implement those kind of cashier, where customers deal by themselves with the check out.

Of course, it is difficult to explain the benefit to customers, as there are basically none (except by cutting the expenses, the retailer don’t have to increase its price to keep its profitability fine).

I learnt recently that the company decided to remove those vendors.

Probably Albertson found out that the total cost savings were not as expected + customers were not accepting this system.

It is interesting if we consider the customer relationship management side of it: To customers, the human touch is a key component of their satisfaction.

I also believe that the mistake of Albertson was not to think about customers benefits to use those cashiers:
- Was there a discount to get? (In order to share the cost)
- Was it faster, more convenient, or more fun?
- Was it compensated by something else (better prices, new service, new area in the store thanks to some space saving?)?
What do you think about it?